8-K
Devon Energy Corp/De (DVN)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): August 5, 2025
Devon Energy Corporation
(Exact name of registrant as specified in its charter)
| DELAWARE | 001-32318 | 73-1567067 |
|---|---|---|
| (State or other jurisdiction<br> <br>of incorporation) | (Commission<br> <br>File Number) | (IRS Employer<br> <br>Identification No.) |
| 333 W. SHERIDAN AVE.,<br> <br>OKLAHOMA CITY, OKLAHOMA | 73102-5015 | |
| --- | --- | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (405) 235-3611
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading<br>Symbol(s) | Name of each exchange<br>on which registered |
|---|---|---|
| Common Stock, par value $0.10 per share | DVN | The New York Stock Exchange |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition. |
|---|
On August 5, 2025, Devon Energy Corporation (the “Company”) announced its financial and operational results for the quarterly period ended June 30, 2025. In connection with this announcement, the Company provided an earnings release and certain supplemental financial information (including guidance and hedging information). Copies of these documents are furnished as Exhibits 99.1 and 99.2, respectively, to this report and, along with certain other materials, will be available on the Company’s website at www.devonenergy.com.
The information contained in this report and the exhibits hereto shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and shall not be incorporated by reference into any filings made by the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as may be expressly set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits. |
|---|
(d) Exhibits
| Exhibit<br>No. | Description of Exhibits |
|---|---|
| 99.1 | Earnings release, dated August 5, 2025. |
| 99.2 | Supplemental financial information (including guidance and hedging information). |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| DEVON ENERGY CORPORATION | |
|---|---|
| By: | /s/ Jeffrey L. Ritenour |
| Jeffrey L. Ritenour | |
| Executive Vice President and Chief Financial Officer |
Date: August 5, 2025
EX-99.1
Exhibit 99.1
| Devon Energy Corporation<br><br><br>333 West Sheridan Avenue |
|---|
| Oklahoma City, OK 73102-5015 |
Devon Energy Reports Second-Quarter Results
and Declares Quarterly Fixed Dividend
KEY HIGHLIGHTS
| • | Delivered $899 million of net earnings, or $1.41 per share; $536 million of core earnings, or $0.84 per<br>share |
|---|---|
| • | Achieved production of 841,000 oil equivalent production (Boe) per day, exceeding the top-end of guidance |
| --- | --- |
| • | Averaged 387,000 barrels per day of oil production, exceeding midpoint guidance |
| --- | --- |
| • | Invested $932 million of capital, 7 percent lower than midpoint guidance |
| --- | --- |
| • | Generated $1.5 billion of operating cash flow and $589 million of free cash flow |
| --- | --- |
| • | Returned $405 million to shareholders through the fixed dividend and share repurchases<br> |
| --- | --- |
| • | Strengthened the balance sheet with cash balances increasing $525 million to a total of $1.8 billion<br> |
| --- | --- |
| • | Closed divestiture of equity interest in the Matterhorn Pipeline for $372 million |
| --- | --- |
| • | On August 1, 2025, acquired outstanding noncontrolling interests in Cotton Draw Midstream for<br>$260 million |
| --- | --- |
| • | Announced two marketing agreements: an LNG export contract with international pricing exposure and a Permian gas<br>sale tied to power pricing, enhancing portfolio diversification |
| --- | --- |
OKLAHOMA CITY – Aug. 5, 2025 – Devon Energy Corp. (NYSE: DVN) today reports second-quarter results and declares quarterly fixed dividend. Supplemental financial tables and forward-looking guidance are available on the company’s website at www.devonenergy.com.
“In the second quarter, we delivered exceptional results exceeding our production guidance with 841,000 Boe per day,” said Clay Gaspar, president and CEO. “We generated $1.5 billion in operating cash flow and $589 million in free cash flow, with capital investments 7 percent below guidance. 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.”
“Amid market fluctuations, we remained focused on operational excellence, leveraging our premier resource base and strong financial position to deliver outstanding results. Our business optimization plan is progressing rapidly, positioning us to achieve $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 added.
“In addition, we completed the $372 million sale of the Matterhorn Pipeline and, on August 1, acquired the remaining noncontrolling interest in Cotton Draw Midstream for $260 million. These transactions support our E&P operations by optimizing our midstream portfolio, enhancing long-term value,” concluded Gaspar.
FINANCIAL RESULTS
Devon reported net earnings of $899 million, or $1.41 per diluted share, in the second quarter of 2025. Adjusting for items analysts typically exclude from estimates, the company’s core earnings were $536 million, or $0.84 per diluted share.
Operating cash flow totaled $1.5 billion in the second quarter, which funded all the company’s capital requirements and resulted in $589 million of free cash flow for the quarter. In addition to this free cash flow, Devon received $372 million in proceeds from the divestiture of its equity ownership in the Matterhorn Pipeline.
During the quarter, Devon’s investment-grade financial position strengthened with cash balances increasing by $525 million to a total of $1.8 billion. The company ended the quarter with outstanding debt of $8.9 billion and a net debt-to-EBITDAX ratio of 0.9 times.
1
RETURN OF CAPITAL
Devon declared its fixed quarterly cash dividend of $0.24 per share, payable on Sep. 30, 2025, to shareholders of record at the close of business on Sep. 15, 2025.
The company also returned capital to shareholders through the ongoing execution of its $5.0 billion share-repurchase program. During the second quarter, Devon repurchased 7.9 million of its shares for $249 million. Since the inception of the share repurchase program, the company has repurchased 85.4 million shares, at a total cost of $3.9 billion.
OPERATING RESULTS
Devon’s capital activity in the second quarter averaged 21 operated drilling rigs and 6 completion crews across its asset portfolio. 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 percent below guidance. This positive variance was primarily attributable to lower completion cost primarily in the Delaware, as wells 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 quarter, exceeding the top-end of guidance. This result represents a 3 percent 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 percent of total volume and at the top-end of the company’s guidance range.
For the second quarter, Devon’s oil, gas and NGL sales totaled $2.7 billion. The company’s realized price during the period, including commodity hedges, was $36.30 per Boe, compared with the prior quarter of $42.45 per Boe. The lower price realization was primarily driven by reduced crude, natural gas, and natural gas liquids benchmark pricing. Also contributing to the lower pricing was the expanded regional gas price differential in the Delaware Basin driven by infrastructure constraints.
Production costs, including taxes, averaged $11.75 per Boe in the second quarter, a 5 percent reduction from the prior quarter. The largest component of production costs is lease operating expense and gathering, processing and transportation costs, which totaled $9.17 per Boe in the quarter.
During the second quarter, Devon divested its equity interest in the Matterhorn Pipeline for $372 million, resulting in a $307 million gain and approximately $68 million of associated taxes.
On August 1, 2025, Devon acquired all outstanding noncontrolling interests in Cotton Draw Midstream (CDM) for $260 million, resulting in 100% ownership of CDM’s equity. Following this transaction, Devon will no longer distribute a portion of CDM’s cash flows to noncontrolling interest holders, resulting in approximately $50 million in annual distribution savings.
MARKETING AGREEMENTS
Devon is announcing 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.
2025 OUTLOOK
Based on the strength of results to date, Devon is increasing its full-year 2025 oil production forecast to a range of 384,000 to 390,000 barrels per day. The company is also increasing its total production outlook and now expects volumes to be in the range of 825,000 to 842,000 Boe per day. Devon has also revised its full-year capital guidance to a range of $3.6 billion to $3.8 billion, down from the previous estimate of approximately $3.8 billion. This $100 million reduction largely reflects the success of the company’s business optimization plan that has resulted in capital reductions for two consecutive quarters.
Additionally, the company is lowering its 2025 current tax expense outlook to 10 percent of pre-tax earnings compared to previous expectations of 15 percent. The reduction is related to change in federal legislation.
In the third quarter of 2025, Devon expects oil production to average 384,000 to 390,000 barrels per day. Capital spending in the third quarter is expected to be approximately $900 million.
Additional details of Devon’s forward-looking guidance are available on the company’s website at www.devonenergy.com.
2
CONFERENCE CALL WEBCAST AND SUPPLEMENTAL EARNINGS MATERIALS
Also provided with today’s release is the company’s earnings presentation that is available on the company’s website at www.devonenergy.com. The company’s second-quarter conference call will be held at 10:00 a.m. Central (11:00 a.m. Eastern) on Wednesday, August 6, 2025, and will serve primarily as a forum for analyst and investor questions and answers.
ABOUT DEVON ENERGY
Devon Energy is a leading oil and gas producer in the U.S. with a diversified multi-basin portfolio headlined by a world-class acreage position in the Delaware Basin. Devon’s disciplined cash-return business model is designed to achieve strong returns, generate free cash flow and return capital to shareholders, while focusing on safe and sustainable operations. For more information, please visit www.devonenergy.com**.**
| Investor Contact | Media Contact |
|---|---|
| investor.relations@dvn.com | Michelle Hindmarch |
| 405-228-4450 | 405-552-7460 |
NON-GAAP DISCLOSURES
This press release includes non-GAAP (generally accepted accounting principles) financial measures. Such non-GAAP measures are not alternatives to GAAP measures, and you should not consider these non-GAAP measures in isolation or as a substitute for analysis of results asreported under GAAP. Reconciliations of these non-GAAP measures and other disclosures are provided within the supplemental financial tables that are available on the company’s website and in the relatedForm 10-Q filed with the Securities and Exchange Commission (the “SEC”).
FORWARD LOOKINGSTATEMENTS
This press release includes “forward-looking statements” within the meaning of the federal securities laws. Such statementsinclude those concerning strategic plans, our expectations and objectives for future operations, as well as other future events or conditions, and are often identified by use of the words and phrases “expects,” “believes,”“will,” “would,” “could,” “continue,” “may,” “aims,” “likely to be,” “intends,” “forecasts,” “projections,” “estimates,” “plans,”“expectations,” “targets,” “opportunities,” “potential,” “anticipates,” “outlook” and other similar terminology. All statements, other than statements of historical facts, included in thispress release that address activities, events or developments that Devon expects, believes or anticipates will or may occur in the future are forward-looking statements. Such statements are subject to a number of assumptions, risks anduncertainties, many of which are beyond our control. Consequently, actual future results could differ materially and adversely from our expectations due to a number of factors, including, but not limited to: the volatility of oil, gas and NGLprices, including from changes in trade relations and policies, such as the imposition of tariffs by the U.S., China or other countries; uncertainties inherent in estimating oil, gas and NGL reserves; the extent to which we are successful inacquiring and discovering additional reserves; the uncertainties, costs and risks involved in our operations; risks related to our hedging activities; our limited control over third parties who operate some of our oil and gas properties; midstreamcapacity constraints and potential interruptions in production, including from limits to the build out of midstream infrastructure; competition for assets, materials, people and capital, which can be exacerbated by supply chain disruptions,including as a result of tariffs or other changes in trade policy; regulatory restrictions, compliance costs and other risks relating to governmental regulation, including with respect to federal lands, environmental matters and water disposal;climate change and risks related to regulatory, social and market efforts to address climate change; risks relating to our ESG initiatives; claims, audits and other proceedings impacting our business, including with respect to historic and legacyoperations; governmental interventions in energy markets; counterparty credit risks; risks relating to our indebtedness; cybersecurity risks; the extent to which insurance covers any losses we may experience; risks related to shareholder activism;our ability to successfully complete mergers, acquisitions and divestitures; our ability to pay dividends and make share repurchases; and any of the other risks and uncertainties discussed in Devon’s 2024 Annual Report on Form 10-K (the “2024 Form 10-K”) or other filings with the SEC.
Theforward-looking statements included in this press release speak only as of the date of this press release, represent management’s current reasonable expectations as of the date of this press release and are subject to the risks anduncertainties identified above as well as those described elsewhere in the 2024 Form 10-K and in other documents we file from time to time with the SEC. We cannot guarantee the accuracy of our forward-lookingstatements, and readers are urged to carefully review and consider the various disclosures made in the 2024 Form 10-K and in other documents we file from time to time with the SEC. All subsequent written andoral forward-looking statements attributable to Devon, or persons acting on its behalf, are expressly qualified in their entirety by the cautionary statements above. We do not undertake, and expressly disclaim, any duty to update or revise ourforward-looking statements based on new information, future events or otherwise.
3
EX-99.2
Exhibit 99.2
Devon Energy Second-Quarter 2025
Supplemental Tables
| TABLE OF CONTENTS: | PAGE: | |
|---|---|---|
| Consolidated Statements of Earnings | 2 | |
| Supplemental Information for Consolidated Statements of Earnings | 3 | |
| Consolidated Balance Sheets | 4 | |
| Consolidated Statements of Cash Flows | 5 | |
| Production | 6 | |
| Capital Expenditures and Supplemental Information for Capital Expenditures | 7 | |
| Realized Pricing | 8 | |
| Asset Margins | 9 | |
| Core Earnings | 10 | |
| EBITDAX, Net Debt and Net<br>Debt-to-EBITDAX | 11 | |
| Free Cash Flow, Adjusted Free Cash Flow and Reinvestment Rate | 12 |
1
CONSOLIDATED STATEMENTS OF EARNINGS
| (in millions, except per share amounts) | 2025 | 2024 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||
| Oil, gas and NGL sales | $ | 2,710 | $ | 3,126 | $ | 3,086 | $ | 2,665 | $ | 2,796 | |||
| Oil, gas and NGL derivatives ^(1)^ | 236 | (98 | ) | (84 | ) | 227 | 23 | ||||||
| Marketing and midstream revenues | 1,338 | 1,424 | 1,401 | 1,132 | 1,098 | ||||||||
| Total revenues | 4,284 | 4,452 | 4,403 | 4,024 | 3,917 | ||||||||
| Production expenses ^(2)^ | 899 | 912 | 881 | 763 | 788 | ||||||||
| Exploration expenses | 20 | 10 | 12 | 4 | 3 | ||||||||
| Marketing and midstream expenses | 1,357 | 1,436 | 1,402 | 1,149 | 1,108 | ||||||||
| Depreciation, depletion and amortization | 914 | 912 | 971 | 794 | 768 | ||||||||
| Asset impairments | — | 254 | — | — | — | ||||||||
| Asset dispositions | (307 | ) | 2 | (5 | ) | — | 15 | ||||||
| General and administrative expenses | 113 | 130 | 155 | 117 | 114 | ||||||||
| Financing costs, net ^(3)^ | 116 | 123 | 123 | 88 | 76 | ||||||||
| Other, net | 11 | 27 | 24 | 45 | 5 | ||||||||
| Total expenses | 3,123 | 3,806 | 3,563 | 2,960 | 2,877 | ||||||||
| Earnings before income taxes | 1,161 | 646 | 840 | 1,064 | 1,040 | ||||||||
| Income tax expense ^(4)^ | 244 | 137 | 187 | 239 | 185 | ||||||||
| Net earnings | 917 | 509 | 653 | 825 | 855 | ||||||||
| Net earnings attributable to noncontrolling interests | 18 | 15 | 14 | 13 | 11 | ||||||||
| Net earnings attributable to Devon | $ | 899 | $ | 494 | $ | 639 | $ | 812 | $ | 844 | |||
| Net earnings per share: | |||||||||||||
| Basic net earnings per share | $ | 1.42 | $ | 0.77 | $ | 0.98 | $ | 1.31 | $ | 1.35 | |||
| Diluted net earnings per share | $ | 1.41 | $ | 0.77 | $ | 0.98 | $ | 1.30 | $ | 1.34 | |||
| Weighted average common shares outstanding: | |||||||||||||
| Basic | 635 | 643 | 650 | 622 | 626 | ||||||||
| Diluted | 636 | 645 | 651 | 623 | 628 |
2
SUPPLEMENTAL INFORMATION FOR CONSOLIDATED STATEMENTS OF EARNINGS
(1) OIL, GAS AND NGL DERIVATIVES
| (in millions) | 2025 | 2024 | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||||
| Derivative cash settlements | $ | 67 | $ | (10 | ) | $ | 58 | $ | 61 | $ | 54 | ||||
| Derivative valuation changes | 169 | (88 | ) | (142 | ) | 166 | (31 | ) | |||||||
| Oil, gas and NGL derivatives | $ | 236 | $ | (98 | ) | $ | (84 | ) | $ | 227 | $ | 23 | |||
| (2) PRODUCTION EXPENSES | |||||||||||||||
| (in millions) | 2025 | 2024 | |||||||||||||
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||||
| Lease operating expense | $ | 483 | $ | 479 | $ | 445 | $ | 366 | $ | 383 | |||||
| Gathering, processing & transportation | 219 | 204 | 213 | 200 | 197 | ||||||||||
| Production taxes | 180 | 212 | 206 | 179 | 188 | ||||||||||
| Property taxes | 17 | 17 | 17 | 18 | 20 | ||||||||||
| Production expenses | $ | 899 | $ | 912 | $ | 881 | $ | 763 | $ | 788 | |||||
| (3) FINANCING COSTS, NET | |||||||||||||||
| (in millions) | 2025 | 2024 | |||||||||||||
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||||
| Interest based on debt outstanding | $ | 126 | $ | 127 | $ | 128 | $ | 98 | $ | 88 | |||||
| Interest income | (14 | ) | (10 | ) | (16 | ) | (19 | ) | (14 | ) | |||||
| Other | 4 | 6 | 11 | 9 | 2 | ||||||||||
| Financing costs, net | $ | 116 | $ | 123 | $ | 123 | $ | 88 | $ | 76 | |||||
| (4) INCOME TAX EXPENSE | |||||||||||||||
| (in millions) | 2025 | 2024 | |||||||||||||
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||||
| Current expense | $ | 226 | $ | 96 | $ | 119 | $ | 75 | $ | 146 | |||||
| Deferred expense | 18 | 41 | 68 | 164 | 39 | ||||||||||
| Income tax expense | $ | 244 | $ | 137 | $ | 187 | $ | 239 | $ | 185 |
3
CONSOLIDATED BALANCE SHEETS
| (in millions) | 2025 | 2024 | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||||
| Current assets: | |||||||||||||||
| Cash, cash equivalents and restricted cash | $ | 1,759 | $ | 1,234 | $ | 846 | $ | 676 | $ | 1,169 | |||||
| Accounts receivable | 1,853 | 2,036 | 1,972 | 1,779 | 1,589 | ||||||||||
| Inventory | 327 | 332 | 294 | 293 | 258 | ||||||||||
| Other current assets | 384 | 303 | 315 | 484 | 343 | ||||||||||
| Total current assets | 4,323 | 3,905 | 3,427 | 3,232 | 3,359 | ||||||||||
| Oil and gas property and equipment, based on successful efforts accounting, net | 23,428 | 23,429 | 23,198 | 23,155 | 18,216 | ||||||||||
| Other property and equipment, net | 1,687 | 1,653 | 1,813 | 1,795 | 1,569 | ||||||||||
| Total property and equipment, net | 25,115 | 25,082 | 25,011 | 24,950 | 19,785 | ||||||||||
| Goodwill | 753 | 753 | 753 | 753 | 753 | ||||||||||
| Right-of-use<br>assets | 185 | 127 | 303 | 317 | 297 | ||||||||||
| Investments | 640 | 713 | 727 | 718 | 704 | ||||||||||
| Other long-term assets | 374 | 348 | 268 | 293 | 264 | ||||||||||
| Total assets | $ | 31,390 | $ | 30,928 | $ | 30,489 | $ | 30,263 | $ | 25,162 | |||||
| Current liabilities: | |||||||||||||||
| Accounts payable | $ | 885 | $ | 923 | $ | 806 | $ | 995 | $ | 754 | |||||
| Revenues and royalties payable | 1,440 | 1,588 | 1,432 | 1,423 | 1,363 | ||||||||||
| Short-term debt | 485 | 485 | 485 | — | 475 | ||||||||||
| Income taxes payable | 190 | 117 | 23 | 4 | 2 | ||||||||||
| Other current liabilities | 537 | 505 | 563 | 484 | 422 | ||||||||||
| Total current liabilities | 3,537 | 3,618 | 3,309 | 2,906 | 3,016 | ||||||||||
| Long-term debt | 8,393 | 8,395 | 8,398 | 8,884 | 5,665 | ||||||||||
| Lease liabilities | 113 | 77 | 320 | 328 | 315 | ||||||||||
| Asset retirement obligations | 839 | 835 | 770 | 765 | 691 | ||||||||||
| Other long-term liabilities | 1,008 | 1,041 | 840 | 820 | 829 | ||||||||||
| Deferred income taxes | 2,208 | 2,189 | 2,148 | 2,082 | 1,917 | ||||||||||
| Stockholders’ equity: | |||||||||||||||
| Common stock | 64 | 64 | 65 | 66 | 63 | ||||||||||
| Additional paid-in capital | 5,864 | 6,096 | 6,387 | 6,662 | 5,478 | ||||||||||
| Retained earnings | 9,252 | 8,506 | 8,166 | 7,670 | 7,132 | ||||||||||
| Accumulated other comprehensive loss | (120 | ) | (121 | ) | (122 | ) | (121 | ) | (122 | ) | |||||
| Total stockholders’ equity attributable to Devon | 15,060 | 14,545 | 14,496 | 14,277 | 12,551 | ||||||||||
| Noncontrolling interests | 232 | 228 | 208 | 201 | 178 | ||||||||||
| Total equity | 15,292 | 14,773 | 14,704 | 14,478 | 12,729 | ||||||||||
| Total liabilities and equity | $ | 31,390 | $ | 30,928 | $ | 30,489 | $ | 30,263 | $ | 25,162 |
4
CONSOLIDATED STATEMENTS OF CASH FLOWS
| (in millions) | 2025 | 2024 | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||||
| Cash flows from operating activities: | |||||||||||||||
| Net earnings | $ | 917 | $ | 509 | $ | 653 | $ | 825 | $ | 855 | |||||
| Adjustments to reconcile net earnings to net cash from operating activities: | |||||||||||||||
| Depreciation, depletion and amortization | 914 | 912 | 971 | 794 | 768 | ||||||||||
| Asset impairments | — | 254 | — | — | — | ||||||||||
| Leasehold impairments | 7 | 5 | 3 | 1 | 1 | ||||||||||
| Accretion of liabilities | 3 | 6 | 6 | 2 | — | ||||||||||
| Total (gains) losses on commodity derivatives | (236 | ) | 98 | 84 | (227 | ) | (23 | ) | |||||||
| Cash settlements on commodity derivatives | 67 | (10 | ) | 58 | 61 | 54 | |||||||||
| (Gains) losses on asset dispositions | (307 | ) | 2 | (5 | ) | — | 15 | ||||||||
| Deferred income tax expense | 18 | 41 | 68 | 164 | 39 | ||||||||||
| Share-based compensation | 23 | 30 | 24 | 24 | 27 | ||||||||||
| Other | 5 | (22 | ) | 4 | 3 | — | |||||||||
| Changes in assets and liabilities, net | 134 | 117 | (202 | ) | 16 | (201 | ) | ||||||||
| Net cash from operating activities | 1,545 | 1,942 | 1,664 | 1,663 | 1,535 | ||||||||||
| Cash flows from investing activities: | |||||||||||||||
| Capital expenditures | (956 | ) | (934 | ) | (926 | ) | (877 | ) | (948 | ) | |||||
| Acquisitions of property and equipment | (16 | ) | (8 | ) | (116 | ) | (3,602 | ) | (82 | ) | |||||
| Divestitures of property, equipment and investments | 372 | 133 | 6 | — | 1 | ||||||||||
| Grayson Mill acquired cash | — | — | — | 147 | — | ||||||||||
| Distributions from investments | 11 | 9 | 33 | 13 | 11 | ||||||||||
| Contributions to investments and other | (8 | ) | (2 | ) | (40 | ) | (30 | ) | (1 | ) | |||||
| Net cash from investing activities | (597 | ) | (802 | ) | (1,043 | ) | (4,349 | ) | (1,019 | ) | |||||
| Cash flows from financing activities: | |||||||||||||||
| Borrowings of long-term debt, net of issuance costs | — | — | — | 3,219 | — | ||||||||||
| Repayments of long-term debt | — | — | — | (472 | ) | — | |||||||||
| Repurchases of common stock | (249 | ) | (301 | ) | (301 | ) | (295 | ) | (256 | ) | |||||
| Dividends paid on common stock | (156 | ) | (163 | ) | (143 | ) | (272 | ) | (223 | ) | |||||
| Contributions from noncontrolling interests | — | 14 | 8 | 20 | 12 | ||||||||||
| Distributions to noncontrolling interests | (14 | ) | (9 | ) | (15 | ) | (10 | ) | (19 | ) | |||||
| Repayment of finance lease | — | (274 | ) | — | — | — | |||||||||
| Shares exchanged for tax withholdings and other | (5 | ) | (19 | ) | 1 | 2 | (9 | ) | |||||||
| Net cash from financing activities | (424 | ) | (752 | ) | (450 | ) | 2,192 | (495 | ) | ||||||
| Effect of exchange rate changes on cash | 1 | — | (1 | ) | 1 | (1 | ) | ||||||||
| Net change in cash, cash equivalents and restricted cash | 525 | 388 | 170 | (493 | ) | 20 | |||||||||
| Cash, cash equivalents and restricted cash at beginning of period | 1,234 | 846 | 676 | 1,169 | 1,149 | ||||||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 1,759 | $ | 1,234 | $ | 846 | $ | 676 | $ | 1,169 | |||||
| Reconciliation of cash, cash equivalents and restricted cash: | |||||||||||||||
| Cash and cash equivalents | $ | 1,713 | $ | 1,198 | $ | 811 | $ | 645 | $ | 1,140 | |||||
| Restricted cash | 46 | 36 | 35 | 31 | 29 | ||||||||||
| Total cash, cash equivalents and restricted cash | $ | 1,759 | $ | 1,234 | $ | 846 | $ | 676 | $ | 1,169 |
5
PRODUCTION
| 2025 | 2024 | ||||
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |
| Oil (MBbls/d) | |||||
| Delaware Basin | |||||
| Rockies | |||||
| Eagle Ford | |||||
| Anadarko Basin | |||||
| Other | |||||
| Total | |||||
| Natural gas liquids (MBbls/d) | |||||
| Delaware Basin | |||||
| Rockies | |||||
| Eagle Ford | |||||
| Anadarko Basin | |||||
| Other | |||||
| Total | |||||
| Gas (MMcf/d) | |||||
| Delaware Basin | |||||
| Rockies | |||||
| Eagle Ford | |||||
| Anadarko Basin | |||||
| Other | |||||
| Total | |||||
| Total oil equivalent (MBoe/d) | |||||
| Delaware Basin | |||||
| Rockies | |||||
| Eagle Ford | |||||
| Anadarko Basin | |||||
| Other | |||||
| Total |
All values are in US Dollars.
6
CAPITAL EXPENDITURES
| 2025 | 2024 | ||||
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |
| (in millions) | |||||
| Delaware Basin | |||||
| Rockies | |||||
| Eagle Ford | |||||
| Anadarko Basin | |||||
| Other | |||||
| Total upstream capital | |||||
| Carbon capital | |||||
| Midstream and Corporate | |||||
| Capital expenditures | |||||
| Acquisitions ^(1)^ | |||||
| Total capital |
All values are in US Dollars.
| (1) | Q3 2024 excludes $5,045 million related to the Grayson Mill acquisition. |
|---|
SUPPLEMENTAL INFORMATION FOR CAPITAL EXPENDITURES
| GROSS OPERATED SPUDS | |||||
| 2025 | 2024 | ||||
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |
| Delaware Basin | |||||
| Rockies | |||||
| Eagle Ford | |||||
| Anadarko Basin | |||||
| Total | |||||
| GROSS OPERATED WELLS TIED-IN | |||||
| 2025 | 2024 | ||||
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |
| Delaware Basin | |||||
| Rockies | |||||
| Eagle Ford | |||||
| Anadarko Basin | |||||
| Total | |||||
| NET OPERATED WELLS TIED-IN | |||||
| 2025 | 2024 | ||||
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |
| Delaware Basin | |||||
| Rockies | |||||
| Eagle Ford | |||||
| Anadarko Basin | |||||
| Total | |||||
| AVERAGE LATERAL LENGTH | |||||
| (based on wells tied-in) | 2025 | 2024 | |||
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |
| Delaware Basin | |||||
| Rockies | |||||
| Eagle Ford | |||||
| Anadarko Basin | |||||
| Total |
All values are in US Dollars.
7
REALIZED PRICING
BENCHMARK PRICES
| (average prices) | 2025 | 2024 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | ||||||
| Oil ($/Bbl) - West Texas Intermediate (Cushing) | $ | 63.95 | $ | 71.50 | $ | 70.32 | $ | 75.20 | $ | 80.62 |
| Natural Gas ($/Mcf) - Henry Hub | $ | 3.44 | $ | 3.65 | $ | 2.79 | $ | 2.15 | $ | 1.89 |
| NGL ($/Bbl) - Mont Belvieu Blended | $ | 25.58 | $ | 29.65 | $ | 27.80 | $ | 25.20 | $ | 26.33 |
REALIZED PRICES
| 2025 | 2024 | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||||
| Oil (Per Bbl) | |||||||||||||||
| Delaware Basin | $ | 62.60 | $ | 70.28 | $ | 69.06 | $ | 74.24 | $ | 79.62 | |||||
| Rockies | 59.05 | 66.40 | 65.67 | 70.39 | 75.73 | ||||||||||
| Eagle Ford | 63.14 | 69.85 | 69.25 | 74.92 | 80.45 | ||||||||||
| Anadarko Basin | 62.09 | 71.15 | 67.46 | 73.13 | 78.36 | ||||||||||
| Realized price without hedges | 61.70 | 69.13 | 68.11 | 73.74 | 79.10 | ||||||||||
| Cash settlements | 1.27 | 0.02 | 1.08 | 0.52 | (0.15 | ) | |||||||||
| Realized price, including cash settlements | $ | 62.97 | $ | 69.15 | $ | 69.19 | $ | 74.26 | $ | 78.95 | |||||
| Natural gas liquids (Per Bbl) | |||||||||||||||
| Delaware Basin | $ | 19.10 | $ | 22.76 | $ | 21.79 | $ | 19.21 | $ | 19.59 | |||||
| Rockies | 9.27 | 14.72 | 12.88 | 8.09 | 9.44 | ||||||||||
| Eagle Ford | 23.03 | 28.65 | 26.40 | 24.18 | 23.07 | ||||||||||
| Anadarko Basin | 22.41 | 26.91 | 25.45 | 22.35 | 22.16 | ||||||||||
| Realized price without hedges | 17.71 | 22.03 | 21.07 | 19.25 | 19.60 | ||||||||||
| Cash settlements | 0.11 | (0.10 | ) | (0.06 | ) | 0.11 | 0.11 | ||||||||
| Realized price, including cash settlements | $ | 17.82 | $ | 21.93 | $ | 21.01 | $ | 19.36 | $ | 19.71 | |||||
| Gas (Per Mcf) | |||||||||||||||
| Delaware Basin | $ | 1.34 | $ | 2.47 | $ | 1.01 | $ | 0.04 | $ | 0.17 | |||||
| Rockies | (0.50 | ) | 1.48 | 0.59 | (0.85 | ) | (0.46 | ) | |||||||
| Eagle Ford | 3.01 | 3.36 | 2.31 | 1.80 | 1.48 | ||||||||||
| Anadarko Basin | 2.86 | 3.42 | 2.27 | 1.74 | 1.70 | ||||||||||
| Realized price without hedges | 1.41 | 2.55 | 1.30 | 0.45 | 0.55 | ||||||||||
| Cash settlements | 0.15 | (0.07 | ) | 0.16 | 0.39 | 0.55 | |||||||||
| Realized price, including cash settlements | $ | 1.56 | $ | 2.48 | $ | 1.46 | $ | 0.84 | $ | 1.10 | |||||
| Total oil equivalent (Per Boe) | |||||||||||||||
| Delaware Basin | $ | 35.92 | $ | 43.00 | $ | 39.66 | $ | 39.85 | $ | 43.63 | |||||
| Rockies | 34.29 | 43.29 | 41.37 | 43.11 | 49.22 | ||||||||||
| Eagle Ford | 48.32 | 49.75 | 46.46 | 50.89 | 54.03 | ||||||||||
| Anadarko Basin | 25.28 | 29.96 | 26.54 | 24.69 | 25.53 | ||||||||||
| Realized price without hedges | 35.43 | 42.58 | 39.57 | 39.80 | 43.44 | ||||||||||
| Cash settlements | 0.87 | (0.13 | ) | 0.75 | 0.91 | 0.85 | |||||||||
| Realized price, including cash settlements | $ | 36.30 | $ | 42.45 | $ | 40.32 | $ | 40.71 | $ | 44.29 |
8
ASSET MARGINS
BENCHMARK PRICES
| (average prices) | 2025 | 2024 | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | ||||||
| Oil ($/Bbl) - West Texas Intermediate (Cushing) | $ | 63.95 | $ | 71.50 | $ | 70.32 | $ | 75.20 | $ | 80.62 |
| Natural Gas ($/Mcf) - Henry Hub | $ | 3.44 | $ | 3.65 | $ | 2.79 | $ | 2.15 | $ | 1.89 |
| NGL ($/Bbl) - Mont Belvieu Blended | $ | 25.58 | $ | 29.65 | $ | 27.80 | $ | 25.20 | $ | 26.33 |
PER-UNIT CASH MARGIN BY ASSET (per Boe)
| 2025 | 2024 | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||||
| Delaware Basin | |||||||||||||||
| Realized price | $ | 35.92 | $ | 43.00 | $ | 39.66 | $ | 39.85 | $ | 43.63 | |||||
| Lease operating expenses | (5.54 | ) | (5.74 | ) | (4.93 | ) | (4.69 | ) | (5.31 | ) | |||||
| Gathering, processing & transportation | (3.17 | ) | (3.00 | ) | (2.92 | ) | (2.79 | ) | (2.89 | ) | |||||
| Production & property taxes | (2.63 | ) | (3.13 | ) | (2.91 | ) | (2.99 | ) | (3.31 | ) | |||||
| Field-level cash margin | $ | 24.58 | $ | 31.13 | $ | 28.90 | $ | 29.38 | $ | 32.12 | |||||
| Rockies | |||||||||||||||
| Realized price | $ | 34.29 | $ | 43.29 | $ | 41.37 | $ | 43.11 | $ | 49.22 | |||||
| Lease operating expenses | (9.13 | ) | (9.31 | ) | (8.63 | ) | (10.83 | ) | (10.43 | ) | |||||
| Gathering, processing & transportation | (0.86 | ) | (1.14 | ) | (1.22 | ) | (2.33 | ) | (2.47 | ) | |||||
| Production & property taxes | (2.85 | ) | (3.83 | ) | (3.66 | ) | (4.56 | ) | (5.22 | ) | |||||
| Field-level cash margin | $ | 21.45 | $ | 29.01 | $ | 27.86 | $ | 25.39 | $ | 31.10 | |||||
| Eagle Ford | |||||||||||||||
| Realized price | $ | 48.32 | $ | 49.75 | $ | 46.46 | $ | 50.89 | $ | 54.03 | |||||
| Lease operating expenses | (7.52 | ) | (6.65 | ) | (5.59 | ) | (6.57 | ) | (7.03 | ) | |||||
| Gathering, processing & transportation | (1.94 | ) | (2.47 | ) | (2.21 | ) | (2.02 | ) | (2.03 | ) | |||||
| Production & property taxes | (3.02 | ) | (2.65 | ) | (2.41 | ) | (2.79 | ) | (2.82 | ) | |||||
| Field-level cash margin | $ | 35.84 | $ | 37.98 | $ | 36.25 | $ | 39.51 | $ | 42.15 | |||||
| Anadarko Basin | |||||||||||||||
| Realized price | $ | 25.28 | $ | 29.96 | $ | 26.54 | $ | 24.69 | $ | 25.53 | |||||
| Lease operating expenses | (2.98 | ) | (3.20 | ) | (2.72 | ) | (2.92 | ) | (3.16 | ) | |||||
| Gathering, processing & transportation | (6.13 | ) | (6.01 | ) | (5.74 | ) | (5.78 | ) | (5.70 | ) | |||||
| Production & property taxes | (1.32 | ) | (1.62 | ) | (1.20 | ) | (1.17 | ) | (1.19 | ) | |||||
| Field-level cash margin | $ | 14.85 | $ | 19.13 | $ | 16.88 | $ | 14.82 | $ | 15.48 | |||||
| Devon - Total | |||||||||||||||
| Realized price | $ | 35.43 | $ | 42.58 | $ | 39.57 | $ | 39.80 | $ | 43.44 | |||||
| Lease operating expenses | (6.31 | ) | (6.53 | ) | (5.70 | ) | (5.46 | ) | (5.95 | ) | |||||
| Gathering, processing & transportation | (2.86 | ) | (2.78 | ) | (2.74 | ) | (2.98 | ) | (3.07 | ) | |||||
| Production & property taxes | (2.58 | ) | (3.11 | ) | (2.86 | ) | (2.95 | ) | (3.23 | ) | |||||
| Field-level cash margin | $ | 23.68 | $ | 30.16 | $ | 28.27 | $ | 28.41 | $ | 31.19 |
9
NON-GAAP MEASURES
(all monetary values in millions, except per share amounts)
Devon’s earnings materials include non-GAAP financial measures. These non-GAAP measures are not alternatives to GAAP measures, and you should not consider these non-GAAP measures in isolation or as a substitute for analysis of our results as reported under GAAP. Below is additional disclosure regarding each of the non-GAAP measures used in the earnings materials, including reconciliations to their most directly comparable GAAP measure.
The earnings materials may include forward-looking non-GAAP measures. The company is unable to provide reconciliations of these forward-looking non-GAAP measures, because components of the calculations are inherently unpredictable, such as changes to current assets and liabilities, the timing of changes in capital accruals, unknown future events and estimating certain future GAAP measures. The inability to reliably quantify certain components of the calculation would significantly affect the usefulness and accuracy of a reconciliation.
CORE EARNINGS
Devon’s reported net earnings include items of income and expense that are typically excluded by securities analysts in their published estimates of the company’s financial results. Accordingly, the company also uses the measures of core earnings and core earnings per share attributable to Devon. Devon believes these non-GAAP measures facilitate comparisons of its performance to earnings estimates published by securities analysts. Devon also believes these non-GAAP measures can facilitate comparisons of its performance between periods and to the performance of its peers. The following table summarizes the effects of these items on second-quarter 2025 and first-quarter 2025 earnings.
| Quarter Ended June 30, 2025 | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Before-tax | After-tax | After NCI | Per DilutedShare | |||||||||
| Total | ||||||||||||
| Earnings (GAAP) | $ | 1,161 | $ | 917 | $ | 899 | $ | 1.41 | ||||
| Adjustments: | ||||||||||||
| Asset dispositions ^(1)^ | (307 | ) | (239 | ) | (239 | ) | (0.38 | ) | ||||
| Asset and exploration impairments | 4 | 2 | 2 | 0.01 | ||||||||
| Fair value changes in financial instruments | (172 | ) | (133 | ) | (133 | ) | (0.21 | ) | ||||
| Restructuring and transaction costs | 9 | 7 | 7 | 0.01 | ||||||||
| Core earnings (Non-GAAP) | $ | 695 | $ | 554 | $ | 536 | $ | 0.84 | ||||
| (1) | The divestiture of our equity interest in Matterhorn drove our Q2 current tax higher, with approximately<br>$100 million of current tax. | |||||||||||
| --- | --- | |||||||||||
| Quarter Ended March 31, 2025 | ||||||||||||
| --- | --- | --- | --- | --- | --- | --- | --- | --- | ||||
| Before-tax | After-tax | After NCI | Per DilutedShare | |||||||||
| Total | ||||||||||||
| Earnings (GAAP) | $ | 646 | $ | 509 | $ | 494 | $ | 0.77 | ||||
| Adjustments: | ||||||||||||
| Asset dispositions | 2 | 1 | 1 | — | ||||||||
| Asset and exploration impairments | 259 | 202 | 202 | 0.31 | ||||||||
| Fair value changes in financial instruments | 88 | 68 | 68 | 0.11 | ||||||||
| Restructuring and transaction costs | 18 | 14 | 14 | 0.02 | ||||||||
| Core earnings (Non-GAAP) | $ | 1,013 | $ | 794 | $ | 779 | $ | 1.21 |
10
EBITDAX
Devon believes EBITDAX provides information useful in assessing operating and financial performance across periods. Devon computes EBITDAX as net earnings before financing costs, net; income tax expense; exploration expenses; depreciation, depletion and amortization; asset impairments; asset disposition gains and losses; non-cash share-based compensation; non-cash valuation changes for derivatives and financial instruments; restructuring and transaction costs; accretion on discounted liabilities; and other items not related to normal operations. EBITDAX as defined by Devon may not be comparable to similarly titled measures used by other companies.
| Q2 ‘25 | Q1 ‘25 | Q4 ‘24 | Q3 ‘24 | TTM | Q2 ‘24 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Net earnings (GAAP) | $ | 917 | $ | 509 | $ | 653 | $ | 825 | $ | 2,904 | $ | 855 | ||||
| Financing costs, net | 116 | 123 | 123 | 88 | 450 | 76 | ||||||||||
| Income tax expense | 244 | 137 | 187 | 239 | 807 | 185 | ||||||||||
| Exploration expenses | 20 | 10 | 12 | 4 | 46 | 3 | ||||||||||
| Depreciation, depletion and amortization | 914 | 912 | 971 | 794 | 3,591 | 768 | ||||||||||
| Asset impairments | — | 254 | — | — | 254 | — | ||||||||||
| Asset dispositions | (307 | ) | 2 | (5 | ) | — | (310 | ) | 15 | |||||||
| Share-based compensation | 22 | 24 | 24 | 24 | 94 | 26 | ||||||||||
| Derivative & financial instrument non-cash val.<br>changes | (169 | ) | 88 | 142 | (166 | ) | (105 | ) | 31 | |||||||
| Accretion on discounted liabilities and other | 11 | 27 | 24 | 45 | 107 | 5 | ||||||||||
| EBITDAX (Non-GAAP) | $ | 1,768 | $ | 2,086 | $ | 2,131 | $ | 1,853 | $ | 7,838 | $ | 1,964 |
NET DEBT
Devon defines net debt as debt (includes short-term and long-term debt) less cash, cash equivalents and restricted cash. Devon believes that netting these sources of cash against debt provides a clearer picture of the future demands on cash from Devon to repay debt.
| 2025 | 2024 | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||||
| Total debt (GAAP) | $ | 8,878 | $ | 8,880 | $ | 8,883 | $ | 8,884 | $ | 6,140 | |||||
| Less: | |||||||||||||||
| Cash, cash equivalents and restricted cash | (1,759 | ) | (1,234 | ) | (846 | ) | (676 | ) | (1,169 | ) | |||||
| Net debt (Non-GAAP) | $ | 7,119 | $ | 7,646 | $ | 8,037 | $ | 8,208 | $ | 4,971 |
NET DEBT-TO-EBITDAX
Devon defines net debt-to-EBITDAX as net debt divided by an annualized EBITDAX measure. Devon believes this ratio provides information useful to investors in assessing the company’s credit position and debt leverage.
| 2025 | 2024 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | ||||||
| Net debt (Non-GAAP) | $ | 7,119 | $ | 7,646 | $ | 8,037 | $ | 8,208 | $ | 4,971 |
| EBITDAX (Non-GAAP) ^(1)^ | $ | 7,838 | $ | 8,034 | $ | 7,739 | $ | 7,496 | $ | 7,668 |
| Net<br>debt-to-EBITDAX (Non-GAAP) | 0.9 | 1.0 | 1.0 | 1.1 | 0.6 | |||||
| (1) | EBITDAX is an annualized measure using a trailing twelve-month calculation. | |||||||||
| --- | --- |
11
FREE CASH FLOW
Devon defines free cash flow as total operating cash flow less capital expenditures. Devon believes free cash flow provides a useful measure of available cash generated by operating activities for other investing and financing activities.
| 2025 | 2024 | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||||
| Total operating cash flow (GAAP) | $ | 1,545 | $ | 1,942 | $ | 1,664 | $ | 1,663 | $ | 1,535 | |||||
| Less capital expenditures: | (956 | ) | (934 | ) | (926 | ) | (877 | ) | (948 | ) | |||||
| Free cash flow (Non-GAAP) | $ | 589 | $ | 1,008 | $ | 738 | $ | 786 | $ | 587 |
ADJUSTED FREE CASH FLOW
Devon is committed to returning cash flow to shareholders through dividends and share repurchases. Adjusted free cash flow is calculated as total operating cash flow before balance sheet changes less accrued capital expenditures.
| 2025 | 2024 | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||||
| Total operating cash flow (GAAP) | $ | 1,545 | $ | 1,942 | $ | 1,664 | $ | 1,663 | $ | 1,535 | |||||
| Changes in assets and liabilities | (134 | ) | (117 | ) | 202 | (16 | ) | 201 | |||||||
| Cash flow before balance sheet changes (Non-GAAP) | 1,411 | 1,825 | 1,866 | 1,647 | 1,736 | ||||||||||
| Capital expenditures (Accrued) ^(1)^ | (948 | ) | (972 | ) | (1,042 | ) | (916 | ) | (971 | ) | |||||
| Adjusted free cash flow (Non-GAAP) | $ | 463 | $ | 853 | $ | 824 | $ | 731 | $ | 765 | |||||
| (1) | Q3 2024 excludes $5,045 million related to the Grayson Mill acquisition. | ||||||||||||||
| --- | --- |
REINVESTMENT RATE
Devon defines reinvestment rate as accrued capital expenditures divided by operating cash flow. Devon believes this measure provides useful information to our investors as an indicator of the capital demands of our business relative to the cash flow generated from normal business operations.
| 2025 | 2024 | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Quarter 2 | Quarter 1 | Quarter 4 | Quarter 3 | Quarter 2 | |||||||||||
| Capital expenditures (Accrued) ^(1)^ | $ | 948 | $ | 972 | $ | 1,042 | $ | 916 | $ | 971 | |||||
| Operating cash flow | $ | 1,545 | $ | 1,942 | $ | 1,664 | $ | 1,663 | $ | 1,535 | |||||
| Reinvestment rate (Non-GAAP) | 61 | % | 50 | % | 63 | % | 55 | % | 63 | % | |||||
| (1) | Q3 2024 excludes $5,045 million related to the Grayson Mill acquisition. | ||||||||||||||
| --- | --- |
12
| THIRD-QUARTER AND FULL-YEAR 2025 GUIDANCE |
|---|
PRODUCTION GUIDANCE
| Quarter 3 | Full Year | |||||||
|---|---|---|---|---|---|---|---|---|
| Low | High | Low | High | |||||
| Oil (MBbls/d) | 384 | 390 | 384 | 390 | ||||
| Natural gas liquids (MBbls/d) | 218 | 224 | 214 | 220 | ||||
| Gas (MMcf/d) | 1,360 | 1,400 | 1,360 | 1,390 | ||||
| Total oil equivalent (MBoe/d) | 829 | 847 | 825 | 842 |
CAPITAL EXPENDITURES GUIDANCE
| Quarter 3 | Full Year | |||||||
|---|---|---|---|---|---|---|---|---|
| (in millions) | Low | High | Low | High | ||||
| Upstream capital | $ | 820 | $ | 860 | $ | 3,400 | $ | 3,525 |
| Carbon capital | 35 | 45 | 100 | 125 | ||||
| Midstream and other capital | 15 | 25 | 100 | 150 | ||||
| Total capital | $ | 870 | $ | 930 | $ | 3,600 | $ | 3,800 |
PRICE REALIZATIONS GUIDANCE
| Quarter 3 | Full Year | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Low | High | Low | High | |||||||||
| Oil - % of WTI | 95 | % | 99 | % | 95 | % | 99 | % | ||||
| NGL - % of WTI | 28 | % | 32 | % | 28 | % | 32 | % | ||||
| Natural gas - % of Henry Hub | 45 | % | 55 | % | 50 | % | 55 | % |
OTHER GUIDANCE ITEMS
| Quarter 3 | Full Year | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| ($ millions, except Boe and %) | Low | High | Low | High | ||||||||
| Marketing and midstream operating profit | $ | (25 | ) | $ | (15 | ) | $ | (80 | ) | $ | (60 | ) |
| LOE and GP&T per BOE | $ | 8.90 | $ | 9.30 | $ | 8.80 | $ | 9.20 | ||||
| Production and property taxes as % of upstream sales | 7.0 | % | 7.8 | % | 7.0 | % | 7.8 | % | ||||
| Exploration expenses | $ | 5 | $ | 15 | $ | 35 | $ | 55 | ||||
| Depreciation, depletion and amortization | $ | 875 | $ | 925 | $ | 3,575 | $ | 3,675 | ||||
| General and administrative expenses | $ | 110 | $ | 120 | $ | 450 | $ | 490 | ||||
| Financing costs, net | $ | 105 | $ | 115 | $ | 440 | $ | 460 | ||||
| Other expenses | $ | — | $ | 10 | $ | 15 | $ | 30 |
INCOME TAX GUIDANCE
| Quarter 3 | Full Year | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (% of pre-tax earnings) | Low | High | Low | High | ||||||||
| Current income tax rate | (1 | )% | 1 | % | 9 | % | 11 | % | ||||
| Deferred income tax rate | 22 | % | 24 | % | 11 | % | 13 | % | ||||
| Total income tax rate | ~23% | ~22% |
1
| 2025 & 2026 HEDGING POSITIONS |
|---|
Oil Commodity Hedges
| Price Swaps | Price Collars | ||||||
|---|---|---|---|---|---|---|---|
| Period | Volume (Bbls/d) | WeightedAverage Price(/Bbl) | Volume<br>(Bbls/d) | WeightedAverage FloorPrice (/Bbl) | WeightedAverage CeilingPrice (/Bbl) | ||
| Q3-Q4 2025 | 9,000 | 105,000 |
All values are in US Dollars.
| Three Way Collars | |||||
|---|---|---|---|---|---|
| Period | Volume (Bbls/d) | Weighted Average FloorSold Price (/Bbl) | Weighted Average FloorPurchased Price (/Bbl) | Weighted AverageCeiling Price (/Bbl) | |
| Q3-Q4 2025 | 13,000 | ||||
| Q1-Q4 2026 | 76,984 |
All values are in US Dollars.
Oil Basis Swaps
| Period | Index | Volume (Bbls/d) | Weighted AverageDifferential to WTI(/Bbl) | |
|---|---|---|---|---|
| Q3-Q4 2025 | Midland Sweet | 63,000 | ||
| Q3 2025 | NYMEX Roll | 9,967 | ||
| Q4 2025 | NYMEX Roll | 13,000 | ||
| Q1-Q4 2026 | Midland Sweet | 46,000 |
All values are in US Dollars.
Natural Gas Commodity Hedges - Henry Hub
| Price Swaps | Price Collars | ||||||
|---|---|---|---|---|---|---|---|
| Period | Volume (MMBtu/d) | WeightedAverage Price(/MMBtu) | Volume<br>(MMBtu/d) | WeightedAverage FloorPrice (/MMBtu) | WeightedAverage CeilingPrice(/MMBtu) | ||
| Q3 2025 | 302,000 | 170,000 | |||||
| Q4 2025 | 245,000 | 170,000 | |||||
| Q1-Q4 2026 | 247,500 | 160,000 |
All values are in US Dollars.
Natural Gas Basis Swaps
| Period | Index | Volume (MMBtu/d) | Weighted AverageDifferential to HenryHub (/MMBtu) | ||
|---|---|---|---|---|---|
| Q3–Q4 2025 | Houston Ship Channel | 230,000 | ) | ||
| Q3–Q4 2025 | WAHA | 200,000 | ) | ||
| Q1–Q4 2026 | Houston Ship Channel | 50,000 | ) | ||
| Q1–Q4 2026 | WAHA | 70,000 | ) |
All values are in US Dollars.
2
| 2025 & 2026 HEDGING POSITIONS (continued) |
|---|
NGL Commodity Hedges
| Price Swaps | ||||
|---|---|---|---|---|
| Period | Product | Volume (Bbls/d) | Weighted AveragePrice (/Bbl) | |
| Q3-Q4 2025 | Natural Gasoline | 3,000 | ||
| Q3-Q4 2025 | Normal Butane | 323 | ||
| Q3-Q4 2025 | Propane | 3,000 |
All values are in US Dollars.
Devon’s oil derivatives settle against the average of the prompt month NYMEX West Texas Intermediate futures price. Devon’s natural gas derivatives settle against the Inside FERC first of the month Henry Hub index. Devon’s NGL derivatives settle against the average of the prompt month OPIS Mont Belvieu, Texas index. Commodity hedge positions are shown as of June 30, 2025.
3