Record Production
Equinor delivered record full-year oil and gas production of 2,137,000 barrels per day, up 3.4% year-over-year; fourth-quarter production rose ~6% quarter-over-quarter.
Equinor ASA
· EQNR
February 4th, 2026
Summary
- Earnings Call Date:
- 2026-02-04
- Change Since:
- +19.95%
- Next Earnings Date:
- 2026-07-22
Earnings Call Sentiment
PositiveThe call emphasized strong operational execution, record production, robust cash generation ($18bn CFFO) and attractive returns (ROACE 14.5%), together with decisive cost and capital allocation actions (CapEx reduced ~$4bn, target unit cost $6/boe) and continued shareholder distributions (dividend +>5%, $1.5bn buyback). Key challenges include a fatal safety incident, legal/tariff uncertainty and political risk on Empire Wind, short‑term cash flow pressure from the Norwegian tax lag, impairments/losses, and a deliberate scaling back of near‑term renewables/low‑carbon investments. Overall, the positives around cash generation, production growth, portfolio high‑grading and clear capital discipline outweigh the listed challenges, though execution and legal risks (notably Empire Wind) and safety remain important near‑term focuses.
Company Guidance
Equinor guided to a focused, more resilient program for 2026–27: production is expected to grow ~3% in 2026 (after record 2025 production of 2,137,000 bbl/d), unit production cost targeted down ~10% to $6/boe in 2026, CO2 upstream intensity ~6.3 kg/boe, and a 3‑year average reserve replacement ratio of 100%; organic CapEx is guided at ~$13 billion for 2026 and ~$9 billion for 2027 (a ~$4 billion reduction versus prior outlook), with ~60% of investment prioritized to the Norwegian continental shelf, ~30% to international oil & gas and ~10% to power, while maintaining ~ $10 billion p.a. oil & gas investment run‑rate; cash flow from operations after tax is expected at ~ $16 billion in 2026 and ~ $18 billion in 2027 (reflecting tax‑lag effects and flat price assumptions), net debt/ capital employed ~17.8%, ROACE was 14.5% in 2025 and is targeted ~13% over the next two years, a $1.5 billion share buyback program for 2026 (first tranche $375 million) complements a quarterly cash dividend raised to $0.39/share (ambition to grow the quarterly dividend by $0.02 p.a.), and project‑level detail includes Empire Wind total CapEx now ~ $7.5 billion with ~$3 billion remaining, ~$2.7 billion drawn from project financing, expected ITC cash effect ~$2.5 billion (c. $2.0 billion recognized in 2027) and combined Empire Wind CFFO of ~ $600 million in 2027–28.
Strong Cash Flow and Returns
Cash flow from operations after tax was $18 billion for 2025; return on average capital employed was 14.5%; earnings per share was $0.81.
Shareholder Distributions and Buybacks
Delivered $9 billion in capital distributions last year; quarterly cash dividend increased >5% to $0.39 per share with an ambition to grow $0.02 p.a.; announced a $1.5 billion share buyback program for 2026 (first tranche $375 million).
Portfolio Progress and Project Starts
Brought Johan Castberg and Bacalhau on stream and opened a new Barents Sea region; 14 commercial discoveries on the Norwegian continental shelf in 2025 (adding ~125 million barrels in new resources); three-year average reserve replacement ratio of 100%.
Empire Wind Execution Progress
Empire Wind now >60% complete with all monopiles, the offshore substation and almost 300 km of subsea cables installed; total project CapEx expected ~ $7.5 billion with ~$3 billion remaining; project financing drawn $2.7 billion to date with ~$400 million remaining; project qualifies for investment tax credits (ITC) with expected cash effect ~ $2.5 billion (~$2.0 billion monetized in 2027 guidance).
Operational and Cost Discipline Targets
Reduced 2026–2027 CapEx outlook by ~$4 billion (mainly power & low carbon), guiding 2026 organic CapEx at ~$13 billion and 2027 at ~$9 billion; target to reduce unit production cost by ~10% to $6 per barrel and aim for 10% OpEx & SG&A reduction in 2026.
Renewables and Power Generation Growth
Renewables power generation was 5.65 TWh in the period, up 25% year-over-year; focus on delivering sanctioned offshore wind projects and building an integrated power business.
U.S. Gas Performance and Market Position
U.S. onshore gas production rose ~45%, contributing ~ $1 billion in cash flow from those assets in 2025; low unit production cost for U.S. gas at around $1/boe and strong marketing/trading access to premium Northeast markets.
Bård Pedersen
Good morning to all, both here in the room in Oslo and to all our participants online. Welcome to the presentation of Equinor's Fourth Quarter and Full Year Results for 2025. My name is B�rd Glad Pedersen. I'm Head of Investor Relations in Equinor. To those of you who are in the room, I want to inform you that there are no emergency drills planned for today. So if there is an alarm, we will evacuate and follow instructions. Today, we will have a presentation first from our CEO, Anders Opedal, followed by a presentation from our CFO, Torgrim Reitan, before we start the Q&A. [Operator Instructions] So with that, I hand it to Anders for your presentation.
Anders Opedal
And thank you all for joining here in the room, and thank you for participating on digital. So for Equinor, 2025 was a year of strong deliveries, but it was also a year of increased geopolitical tension and market uncertainty. Our job is to ensure we allocate our resources in a way that maintain a competitive business, creating value at all times. Today, Torgrim and I will show how we take the necessary measures to further strengthen our competitiveness, cash flow and robustness. This makes sure that we can navigate through and leverage market volatility and the current macro environment. So we have 3 key messages for you today. First, we are well positioned for maximizing long-term shareholder value. Today, we will share how clear strategic priorities guide capital allocation for 2026 and '27, and we will revert at our Capital Market Day in June to present our strategy towards 2030.
Second, we take firm actions to strengthen...
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