MIDLAND, Texas, Nov. 03, 2025 (GLOBE NEWSWIRE) -- Diamondback Energy, Inc. (NASDAQ: FANG) ("Diamondback," "we," "our" or the "Company") today announced financial and operating results for the third quarter ended September 30, 2025.
THIRD QUARTER 2025 HIGHLIGHTS
- Average oil production of 503.8 MBO/d (942.9 MBOE/d)
- Net cash provided by operating activities of $2.4 billion; Operating Cash Flow Before Working Capital Changes1 of $2.5 billion
- Cash capital expenditures of $774 million
- Free Cash Flow1 of $1.8 billion; Adjusted Free Cash Flow1 of $1.8 billion
- Declared Q3 2025 base cash dividend of $1.00 per share payable on November 20, 2025; implies a 2.8% annualized yield based on October 31, 2025 closing share price of $143.19
- Repurchased 4,286,080 shares of common stock for approximately $603 million (at a weighted average price of $140.70 per share excluding excise tax)
- Total return of capital of $892 million; represents 50% of Adjusted Free Cash Flow from stock repurchases and the declared Q3 2025 base dividend
- As previously announced, Viper Energy, Inc. ("Viper"), a subsidiary of Diamondback, closed the acquisition of Sitio Royalties Corp. ("Sitio") on August 19th
___________________
1 NON-GAAP DISCLOSURES
For a definition of Operating Cash Flow Before Working Capital Changes, Free Cash Flow, Adjusted Free Cash Flow, Adjusted Net Income, Adjusted EBITDA, Adjusted Net Income per Diluted Share, Net Debt and reconciliations of such non-GAAP financial metrics to their respective most directly comparable GAAP metrics, please see "Non-GAAP Financial Measures" below.
RECENT HIGHLIGHTS
- On October 1st, closed the previously announced divestiture of Environmental Disposal Systems, LLC to Deep Blue Midland Basin LLC ("Deep Blue"); Diamondback retained its 30% equity ownership in Deep Blue and received $694 million upfront cash proceeds; additionally, Diamondback has the potential to earn up to $200 million in contingent consideration based on the achievement of certain completion thresholds for the years 2026 through 2028
- On October 31st, closed the previously announced divestiture of the Company's 27.5% equity interest in EPIC Crude Holdings, LP ("EPIC Crude") and received $504 million upfront cash proceeds; additionally, Diamondback has the potential to earn $96 million in contingent consideration should a capacity expansion of EPIC Crude be formally sanctioned before year-end 2027
- Repurchased 610,996 shares of common stock in Q4 2025 (to date) for $87 million (at a weighted average price of $143.21 per share excluding excise tax)
- Repurchased $203 million in senior notes due 2051 & 2052 at 82.3% of par (~$167 million) in Q4 2025 (to date)
UPDATED 2025 GUIDANCE HIGHLIGHTS
- Increasing full year oil production guidance to 495 - 498 MBO/d and increasing annual BOE guidance to 910 - 920 MBOE/d
- Narrowing full year cash capital expenditures to $3.45 - $3.55 billion; unchanged at the midpoint from August update
- The Company expects to drill 445 - 465 gross (412 - 430 net) wells and complete between 510 - 520 gross (471 - 481 net) wells with an average lateral length of approximately 11,500 feet in 2025
- Q4 2025 oil production guidance of 505 - 515 MBO/d (927 - 963 MBOE/d)
- Q4 2025 cash capital expenditures guidance of $875 - $975 million
OPERATIONS UPDATE
The following tables provide a summary of Diamondback's key operational updates for the quarter:
Wells Drilled and Completed:
| Three Months Ended September 30, 2025 | Nine Months Ended September 30, 2025 | ||||||||||||||
| Drilled | Completed | Drilled | Completed | ||||||||||||
| Area: | Gross | Net | Gross | Net | Gross | Net | Gross | Net | |||||||
| Midland Basin | 107 | 97 | 137 | 127 | 352 | 326 | 361 | 342 | |||||||
| Delaware Basin | 1 | 1 | - | - | 4 | 4 | 15 | 13 | |||||||
| Total | 108 | 98 | 137 | 127 | 356 | 330 | 376 | 355 | |||||||
Gross Wells Drilled and Completed By Zone:
| Three Months Ended September 30, 2025 | Nine Months Ended September 30, 2025 | ||||||
| Number of Wells Drilled | Number of Wells Completed | Number of Wells Drilled | Number of Wells Completed | ||||
| Midland Basin: | |||||||
| Upper Spraberry | 1 | 3 | 6 | 13 | |||
| Middle Spraberry | 7 | 11 | 24 | 32 | |||
| Jo Mill | 19 | 26 | 63 | 54 | |||
| Lower Spraberry | 19 | 28 | 73 | 77 | |||
| Dean | 1 | 10 | 13 | 22 | |||
| Wolfcamp A | 28 | 27 | 73 | 66 | |||
| Wolfcamp B | 25 | 27 | 83 | 80 | |||
| Wolfcamp D | 4 | 1 | 9 | 7 | |||
| Barnett | 3 | 4 | 8 | 10 | |||
| Midland Basin Total | 107 | 137 | 352 | 361 | |||
| Delaware Basin: | |||||||
| 2nd Bone Spring | - | - | - | 2 | |||
| 3rd Bone Spring | 1 | - | 3 | 8 | |||
| Wolfcamp A | - | - | 1 | 5 | |||
| Delaware Basin Total | 1 | - | 4 | 15 | |||
| Total Company Operated | 108 | 137 | 356 | 376 | |||
| Average Completed Lateral Length (in feet) | 11,020 | 12,060 | |||||
Realized Average Prices:
| Three Months Ended | |||||||||
| September 30, 2025 | June 30, 2025 | September 30, 2024 | |||||||
| Average Prices: | |||||||||
| Oil ($ per Bbl) | $ | 64.60 | $ | 63.23 | $ | 73.13 | |||
| Natural gas ($ per Mcf) | $ | 0.75 | $ | 0.88 | $ | (0.26 | ) | ||
| Natural gas liquids ($ per Bbl) | $ | 17.28 | $ | 18.13 | $ | 17.70 | |||
| Combined ($ per BOE) | $ | 39.73 | $ | 39.61 | $ | 44.80 | |||
| Oil, hedged ($ per Bbl)(1) | $ | 63.70 | $ | 62.34 | $ | 72.32 | |||
| Natural gas, hedged ($ per Mcf)(1) | $ | 1.75 | $ | 1.45 | $ | 0.60 | |||
| Natural gas liquids, hedged ($ per Bbl)(1) | $ | 17.28 | $ | 18.13 | $ | 17.70 | |||
| Average price, hedged ($ per BOE)(1) | $ | 40.58 | $ | 39.89 | $ | 45.43 | |||
(1) Hedged prices reflect the effect of our commodity derivative transactions on our average sales prices and include gains and losses on cash settlements for matured commodity derivatives, which we do not designate for hedge accounting. Hedged prices exclude gains or losses resulting from the early settlement of commodity derivative contracts.
Average Costs per BOE:
| Three Months Ended | ||||||||
| September 30, 2025 | June 30, 2025 | September 30, 2024 | ||||||
| Lease operating expenses | $ | 5.65 | $ | 5.26 | $ | 6.01 | ||
| Production and ad valorem taxes | 2.44 | 2.56 | 2.91 | |||||
| Gathering, processing and transportation expense | 1.41 | 1.73 | 1.94 | |||||
| General and administrative - cash component | 0.55 | 0.55 | 0.63 | |||||
| Total operating expense - cash | $ | 10.05 | $ | 10.10 | $ | 11.49 | ||
FINANCIAL UPDATE
Earnings Attributable to Diamondback Energy, Inc.:
| Three Months Ended September 30, 2025 | ||
| (in millions, except per share amounts) | ||
| Net income (loss) attributable to Diamondback Energy, Inc. | $ | 1,018 |
| Earnings (loss) per common share attributable to Diamondback Energy, Inc. - Diluted(1) | $ | 3.51 |
| Adjusted net income(1) | $ | 895 |
| Adjusted net income per common share - Diluted(1) | $ | 3.08 |
(1) The Company's earnings (loss) per diluted share amount has been computed using the two-class method in accordance with GAAP. The two-class method is an earnings allocation which reflects the respective ownership among holders of common stock and participating securities. Diluted earnings per share using the two-class method is calculated as (i) net income attributable to Diamondback Energy, Inc, (ii) less the reallocation of $4 million in earnings attributable to participating securities, (iii) divided by diluted weighted average common shares outstanding for the respective periods.
Capital Expenditures:
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||
| (in millions) | |||||||||||
| Operated drilling and completion additions to oil and natural gas properties | $ | 632 | $ | 631 | $ | 2,203 | $ | 1,785 | |||
| Capital workovers, non-operated additions to oil and natural gas properties and science | 94 | 2 | 205 | 13 | |||||||
| Infrastructure, environmental and midstream additions | 48 | 55 | 172 | 136 | |||||||
| Total | $ | 774 | $ | 688 | $ | 2,580 | $ | 1,934 | |||
Adjusted EBITDA and Free Cash Flow - Non-GAAP:
| Three Months Ended September 30, 2025 | Nine Months Ended September 30, 2025 | ||||
| (in millions) | |||||
| Net income (loss) attributable to Diamondback Energy, Inc. | $ | 1,018 | $ | 3,122 | |
| Consolidated Adjusted EBITDA | $ | 2,638 | $ | 8,027 | |
| Adjusted EBITDA attributable to Diamondback Energy, Inc. | $ | 2,408 | $ | 7,520 | |
| Net cash provided by operating activities | $ | 2,383 | $ | 6,415 | |
| Free Cash Flow | $ | 1,760 | $ | 4,547 | |
| Adjusted Free Cash Flow | $ | 1,792 | $ | 4,709 | |
Debt & Liquidity:
| September 30, 2025 | ||
| (in millions) | ||
| Standalone cash | $ | 106 |
| Borrowings outstanding under the credit facility | $ | 175 |
| Remaining availability under the credit facility | $ | 2,325 |
| Total liquidity | $ | 2,431 |
| Consolidated total debt | $ | 16,432 |
| Consolidated total net debt | $ | 15,893 |
RETURN OF CAPITAL UPDATE
Diamondback announced today that the Company's Board of Directors (the "Board") declared a base cash dividend of $1.00 per common share for the third quarter of 2025 payable on November 20, 2025, to stockholders of record at the close of business on November 13, 2025.
On July 31, 2025, Diamondback's Board approved a $2.0 billion increase to the share repurchase authorization, bringing total capacity to $8.0 billion (excluding excise tax), with $3.0 billion remaining as of October 31, 2025. The Company expects to continue repurchases opportunistically using cash on hand, free cash flow and potential asset sale proceeds. The program has no time limit and may be suspended, modified or discontinued at the Board's discretion. Repurchases may be executed in privately negotiated or open-market transactions, consistent with Rule 10b-18 under the Securities Exchange Act of 1934, as amended, and will be subject to market conditions, applicable regulatory and legal requirements and other factors. All shares repurchased will be retired.
The table below summarizes Diamondback's return of capital program, including dividends and share repurchases, with future actions subject to Board approval.
| Q32025 | Q42025to date | Cumulative | |||||||
| (in millions, except per share amounts, shares in thousands) | |||||||||
| Base dividend | $ | 1.00 | |||||||
| Shares repurchased | 4,286 | 611 | 36,129 | ||||||
| Weighted average repurchase price | $ | 140.70 | $ | 143.21 | $ | 138.08 | |||
| Total repurchase cost | $ | 603 | $ | 87 | $ | 4,989 | |||
| Total return of capital | $ | 892 | |||||||
| Return of capital % free cash flow | 51 | % | |||||||
| Return of capital % adjusted free cash flow | 50 | % | |||||||
FULL YEAR 2025 GUIDANCE
Below is Diamondback's updated guidance for the full year 2025, which includes fourth quarter production, cash tax and capital guidance.
| 2025 Guidance | 2025 Guidance | ||||||
| Diamondback Energy, Inc. | Viper Energy, Inc. | ||||||
| 2025 Net production - MBOE/d | 910 - 920 (from 890 - 910) | 92.8 - 93.5 | |||||
| 2025 Oil production - MBO/d | 495 - 498 (from 485 - 492) | 48.8 - 49.0 | |||||
| Q4 2025 Oil production - MBO/d (total - MBOE/d) | 505 - 515 (927 - 963) | 65.0 - 67.0 (124.0 - 128.0) | |||||
| Unit costs ($/BOE) | |||||||
| Lease operating expenses, including workovers | $5.40 - $5.70 (from $5.30 - $5.70) | ||||||
| G&A | |||||||
| Cash G&A | $0.60 - $0.75 | $0.80 - $1.00 | |||||
| Non-cash equity-based compensation | $0.25 - $0.35 | $0.10 - $0.20 | |||||
| DD&A | $14.50 - $15.50 | $16.75 - $17.25 | |||||
| Interest expense (net of interest income) | $0.60 - $0.80 | $2.50 - $3.00 | |||||
| Gathering, processing and transportation | $1.45 - $1.60 (from $1.60 - $1.75) | ||||||
| Production and ad valorem taxes (% of revenue) | ~7% | ~7% | |||||
| Corporate tax rate (% of pre-tax income) | 23% | ||||||
| Cash tax rate (% of pre-tax income)(1) | 15% - 18% | 21% - 23% | |||||
| Q4 2025 Cash taxes | (19,208 | ) | |||||
| Property and equipment, net | 72,533 | 64,472 | |||||
| Funds held in escrow | 17 | 1 | |||||
| Equity method investments | 362 | 375 | |||||
| Assets held for sale | 505 | - | |||||
| Derivative instruments | 1 | 2 | |||||
| Deferred income taxes, net ($- million and $185 million related to Viper) | - | 173 | |||||
| Other assets | 214 | 159 | |||||
| Total assets | $ | 76,213 | $ | 67,292 | |||
| Liabilities and Stockholders' Equity | |||||||
| Current liabilities: | |||||||
| Accounts payable - trade | $ | 426 | $ | 253 | |||
| Accrued capital expenditures | 846 | 690 | |||||
| Current maturities of debt ($380 million and $- million related to Viper) | 394 | 900 | |||||
| Other accrued liabilities | 1,000 | 1,020 | |||||
| Revenues and royalties payable | 1,433 | 1,491 | |||||
| Derivative instruments | 10 | 43 | |||||
| Income taxes payable | 33 | 414 | |||||
| Total current liabilities | 4,142 | 4,811 | |||||
| Long-term debt ($2,241 million and $1,083 million related to Viper) | 15,848 | 12,075 | |||||
| Derivative instruments | 106 | 106 | |||||
| Asset retirement obligations | 584 | 573 | |||||
| Deferred income taxes | 9,877 | 9,826 | |||||
| Other long-term liabilities | 22 | 39 | |||||
| Total liabilities | 30,579 | 27,430 | |||||
| Stockholders' equity: | |||||||
| Common stock, $0.01 par value; 800,000,000 shares authorized; 286,876,206 and 290,984,373 shares issued and outstanding at September 30, 2025, and December 31, 2024, respectively | 3 | 3 | |||||
| Additional paid-in capital | 32,606 | 33,501 | |||||
| Retained earnings (accumulated deficit) | 6,486 | 4,238 | |||||
| Accumulated other comprehensive income (loss) | (7 | ) | (6 | ) | |||
| Total Diamondback Energy, Inc. stockholders' equity | 39,088 | 37,736 | |||||
| Non-controlling interest | 6,546 | 2,126 | |||||
| Total equity | 45,634 | 39,862 | |||||
| Total liabilities and stockholders' equity | $ | 76,213 | $ | 67,292 | |||
| Diamondback Energy, Inc. | |||||||||||||||
| Condensed Consolidated Statements of Operations | |||||||||||||||
| (unaudited, $ in millions except per share data, shares in thousands) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||
| Revenues: | |||||||||||||||
| Oil, natural gas and natural gas liquid sales | $ | 3,447 | $ | 2,354 | $ | 10,420 | $ | 6,629 | |||||||
| Sales of purchased oil | 459 | 282 | 1,168 | 698 | |||||||||||
| Other operating income | 18 | 9 | 62 | 28 | |||||||||||
| Total revenues | 3,924 | 2,645 | 11,650 | 7,355 | |||||||||||
| Costs and expenses: | |||||||||||||||
| Lease operating expenses | 490 | 316 | 1,338 | 825 | |||||||||||
| Production and ad valorem taxes | 212 | 153 | 654 | 413 | |||||||||||
| Gathering, processing and transportation | 122 | 102 | 378 | 261 | |||||||||||
| Purchased oil expense | 455 | 280 | 1,168 | 696 | |||||||||||
| Depreciation, depletion, amortization and accretion | 1,286 | 742 | 3,649 | 1,694 | |||||||||||
| General and administrative expenses | 70 | 49 | 210 | 141 | |||||||||||
| Merger and transaction expenses | 17 | 258 | 94 | 273 | |||||||||||
| Other operating expenses | 36 | 35 | 111 | 68 | |||||||||||
| Total costs and expenses | 2,688 | 1,935 | 7,602 | 4,371 | |||||||||||
| Income (loss) from operations | 1,236 | 710 | 4,048 | 2,984 | |||||||||||
| Other income (expense): | |||||||||||||||
| Interest expense, net | (70 | ) | (18 | ) | (166 | ) | (101 | ) | |||||||
| Other income (expense), net | 108 | 89 | 133 | 87 | |||||||||||
| Gain (loss) on derivative instruments, net | 120 | 131 | 149 | 101 | |||||||||||
| Gain (loss) on extinguishment of debt | (32 | ) | - | 23 | 2 | ||||||||||
| Income (loss) from equity investments, net | 8 | 6 | 20 | 23 | |||||||||||
| Total other income (expense), net | 134 | 208 | 159 | 112 | |||||||||||
| Income (loss) before income taxes | 1,370 | 918 | 4,207 | 3,096 | |||||||||||
| Provision for (benefit from) income taxes | 287 | 210 | 894 | 685 | |||||||||||
| Net income (loss) | 1,083 | 708 | 3,313 | 2,411 | |||||||||||
| Net income (loss) attributable to non-controlling interest | 65 | 49 | 191 | 147 | |||||||||||
| Net income (loss) attributable to Diamondback Energy, Inc. | $ | 1,018 | $ | 659 | $ | 3,122 | $ | 2,264 | |||||||
| Earnings (loss) per common share: | |||||||||||||||
| Basic | $ | 3.51 | $ | 3.19 | $ | 10.71 | $ | 12.00 | |||||||
| Diluted | $ | 3.51 | $ | 3.19 | $ | 10.71 | $ | 12.00 | |||||||
| Weighted average common shares outstanding: | |||||||||||||||
| Basic | 288,826 | 204,730 | 290,188 | 187,253 | |||||||||||
| Diluted | 288,826 | 204,730 | 290,188 | 187,253 | |||||||||||
| Diamondback Energy, Inc. | |||||||||||||||
| Condensed Consolidated Statements of Cash Flows | |||||||||||||||
| (unaudited, in millions) | |||||||||||||||
| Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
| 2025 | 2024 | 2025 | 2024 | ||||||||||||
| Cash flows from operating activities: | |||||||||||||||
| Net income (loss) | $ | 1,083 | $ | 708 | $ | 3,313 | $ | 2,411 | |||||||
| Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | |||||||||||||||
| Provision for (benefit from) deferred income taxes | 253 | 51 | 235 | 180 | |||||||||||
| Depreciation, depletion, amortization and accretion | 1,286 | 742 | 3,649 | 1,694 | |||||||||||
| (Gain) loss on extinguishment of debt | 32 | - | (23 | ) | (2 | ) | |||||||||
| (Gain) loss on derivative instruments, net | (120 | ) | (131 | ) | (149 | ) | (101 | ) | |||||||
| Cash received (paid) on settlement of derivative instruments | 60 | (4 | ) | 108 | (36 | ) | |||||||||
| (Income) loss from equity investment, net | (8 | ) | (6 | ) | (20 | ) | (23 | ) | |||||||
| Equity-based compensation expense | 22 | 16 | 61 | 49 | |||||||||||
| Other | (74 | ) | 20 | (47 | ) | 77 | |||||||||
| Changes in operating assets and liabilities: | |||||||||||||||
| Accounts receivable | (22 | ) | 106 | 138 | 61 | ||||||||||
| Income tax receivable | - | - | 3 | 12 | |||||||||||
| Prepaid expenses and other current assets | (49 | ) | (11 | ) | (65 | ) | 78 | ||||||||
| Accounts payable and accrued liabilities | 28 | (395 | ) | (355 | ) | (490 | ) | ||||||||
| Income taxes payable | (206 | ) | (36 | ) | (515 | ) | (51 | ) | |||||||
| Revenues and royalties payable | 58 | 95 | 28 | 109 | |||||||||||
| Other | 40 | 54 | 54 | 104 | |||||||||||
| Net cash provided by (used in) operating activities | 2,383 | 1,209 | 6,415 | 4,072 | |||||||||||
| Cash flows from investing activities: | |||||||||||||||
| Additions to oil and natural gas properties | (774 | ) | (688 | ) | (2,580 | ) | (1,934 | ) | |||||||
| Property acquisitions | (1,536 | ) | (7,791 | ) | (5,411 | ) | (7,994 | ) | |||||||
| Proceeds from sale of assets | 257 | 207 | 314 | 459 | |||||||||||
| Other | (6 | ) | 106 | (14 | ) | 103 | |||||||||
| Net cash provided by (used in) investing activities | (2,059 | ) | (8,166 | ) | (7,691 | ) | (9,366 | ) | |||||||
| Cash flows from financing activities: | |||||||||||||||
| Proceeds under term loan agreements | 500 | 1,000 | 2,000 | 1,000 | |||||||||||
| Repayments under term loan agreements | - | - | (900 | ) | - | ||||||||||
| Proceeds from borrowings under credit facilities | 2,300 | 1,011 | 8,222 | 1,185 | |||||||||||
| Repayments under credit facilities | (2,885 | ) | (1,073 | ) | (8,148 | ) | (1,333 | ) | |||||||
| Proceeds from senior notes | 1,600 | - | 2,800 | 5,500 | |||||||||||
| Repayment of senior notes | (428 | ) | - | (672 | ) | (25 | ) | ||||||||
| Repurchased shares under buyback program | (603 | ) | (515 | ) | (1,576 | ) | (557 | ) | |||||||
| Proceeds from partial sale of investment in Viper Energy, Inc. | - | - | - | 451 | |||||||||||
| Net proceeds from Viper's issuance of common stock | - | 476 | 1,232 | 476 | |||||||||||
| Dividends paid to stockholders | (289 | ) | (416 | ) | (870 | ) | (1,316 | ) | |||||||
| Dividends to non-controlling interest | (78 | ) | (59 | ) | (255 | ) | (157 | ) | |||||||
| Other | (110 | ) | (5 | ) | (169 | ) | (142 | ) | |||||||
| Net cash provided by (used in) financing activities | 7 | 419 | 1,664 | 5,082 | |||||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | 331 | (6,538 | ) | 388 | (212 | ) | |||||||||
| Cash, cash equivalents and restricted cash at beginning of period | 221 | 6,911 | 164 | 585 | |||||||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 552 | $ | 373 | $ | 552 | $ | 373 | |||||||
| Diamondback Energy, Inc. | |||||||||
| Selected Operating Data | |||||||||
| (unaudited) | |||||||||
| Three Months Ended | |||||||||
| September 30, 2025 | June 30, 2025 | September 30, 2024 | |||||||
| Production Data: | |||||||||
| Oil (MBbls) | 46,345 | 45,108 | 29,537 | ||||||
| Natural gas (MMcf) | 115,353 | 110,119 | 66,519 | ||||||
| Natural gas liquids (MBbls) | 21,180 | 20,248 | 11,918 | ||||||
| Combined volumes (MBOE)(1) | 86,751 | 83,709 | 52,541 | ||||||
| Daily oil volumes (BO/d) | 503,750 | 495,692 | 321,054 | ||||||
| Daily combined volumes (BOE/d) | 942,946 | 919,879 | 571,098 | ||||||
| Average Prices: | |||||||||
| Oil ($ per Bbl) | $ | 64.60 | $ | 63.23 | $ | 73.13 | |||
| Natural gas ($ per Mcf) | $ | 0.75 | $ | 0.88 | $ | (0.26 | ) | ||
| Natural gas liquids ($ per Bbl) | $ | 17.28 | $ | 18.13 | $ | 17.70 | |||
| Combined ($ per BOE) | $ | 39.73 | $ | 39.61 | $ | 44.80 | |||
| Oil, hedged ($ per Bbl)(2) | $ | 63.70 | $ | 62.34 | $ | 72.32 | |||
| Natural gas, hedged ($ per Mcf)(2) | $ | 1.75 | $ | 1.45 | $ | 0.60 | |||
| Natural gas liquids, hedged ($ per Bbl)(2) | $ | 17.28 | $ | 18.13 | $ | 17.70 | |||
| Average price, hedged ($ per BOE)(2) | $ | 40.58 | $ | 39.89 | $ | 45.43 | |||
| Average Costs per BOE: | |||||||||
| Lease operating expenses | $ | 5.65 | $ | 5.26 | $ | 6.01 | |||
| Production and ad valorem taxes | 2.44 | 2.56 | 2.91 | ||||||
| Gathering, processing and transportation expense | 1.41 | 1.73 | 1.94 | ||||||
| General and administrative - cash component | 0.55 | 0.55 | 0.63 | ||||||
| Total operating expense - cash | $ | 10.05 | $ | 10.10 | $ | 11.49 | |||
| General and administrative - non-cash component | $ | 0.25 | $ | 0.25 | $ | 0.30 | |||
| Depreciation, depletion, amortization and accretion | $ | 14.82 | $ | 15.12 | $ | 14.12 | |||
| Interest expense, net | $ | 0.81 | $ | 0.67 | $ | 0.34 | |||
(1) Bbl equivalents are calculated using a conversion rate of six Mcf per one Bbl.
(2) Hedged prices reflect the effect of our commodity derivative transactions on our average sales prices and include gains and losses on cash settlements for matured commodity derivatives, which we do not designate for hedge accounting. Hedged prices exclude gains or losses resulting from the early settlement of commodity derivative contracts.
NON-GAAP FINANCIAL MEASURES
ADJUSTED EBITDA
Adjusted EBITDA is a supplemental non-GAAP financial measure that is used by management and external users of our financial statements, such as industry analysts, investors, lenders and rating agencies. The Company defines Adjusted EBITDA as net income (loss) attributable to Diamondback Energy, Inc., plus net income (loss) attributable to non-controlling interest ("net income (loss)") before non-cash (gain) loss on derivative instruments, net, interest expense, net, depreciation, depletion, amortization and accretion, depreciation and interest expense related to equity method investments, (gain) loss on extinguishment of debt, non-cash equity-based compensation expense, capitalized equity-based compensation expense, merger and transaction expenses, other non-cash transactions and provision for (benefit from) income taxes. Adjusted EBITDA is not a measure of net income as determined by United States generally accepted accounting principles ("GAAP"). Management believes Adjusted EBITDA is useful because the measure allows it to evaluate the Company's operating performance and compare the results of its operations from period to period without regard to its financing methods or capital structure. The Company excludes the items listed above from net income (loss) to determine Adjusted EBITDA because these amounts can vary substantially from company to company within its industry depending upon accounting methods and book values of assets, capital structures and the method by which the assets were acquired. Further, the Company excludes the effects of significant transactions that may affect earnings but are unpredictable in nature, timing and amount, although they may recur in different reporting periods. Adjusted EBITDA should not be considered as an alternative to, or more meaningful than, net income as determined in accordance with GAAP or as an indicator of the Company's operating performance. Certain items excluded from Adjusted EBITDA are significant components in understanding and assessing a company's financial performance, such as a company's cost of capital and tax structure, as well as the historic costs of depreciable assets. The Company's computation of Adjusted EBITDA may not be comparable to other similarly titled measures of other companies or to such measure in our credit facility or any of our other contracts.
The following tables present a reconciliation of the GAAP financial measure of net income (loss) attributable to Diamondback Energy, Inc. to the non-GAAP financial measure of Adjusted EBITDA:
Diamondback Energy, Inc. | |||||||
| Reconciliation of Net Income (Loss) to Adjusted EBITDA | |||||||
| (unaudited, in millions) | |||||||
| Three Months Ended September 30, 2025 | Nine Months Ended September 30, 2025 | ||||||
| Net income (loss) attributable to Diamondback Energy, Inc. | $ | 1,018 | $ | 3,122 | |||
| Net income (loss) attributable to non-controlling interest | 65 | 191 | |||||
| Net income (loss) | 1,083 | 3,313 | |||||
| Non-cash (gain) loss on derivative instruments, net | (60 | ) | (41 | ) | |||
| Interest expense, net | 70 | 166 | |||||
| Depreciation, depletion, amortization and accretion | 1,286 | 3,649 | |||||
| Depreciation and interest expense related to equity method investments | 22 | 67 | |||||
| (Gain) loss on extinguishment of debt | 32 | (23 | ) | ||||
| Non-cash equity-based compensation expense | 31 | 85 | |||||
| Capitalized equity-based compensation expense | (9 | ) | (24 | ) | |||
| Merger and transaction expenses | 17 | 94 | |||||
| Other non-cash transactions | (121 | ) | (153 | ) | |||
| Provision for (benefit from) income taxes | 287 | 894 | |||||
| Consolidated Adjusted EBITDA | 2,638 | 8,027 | |||||
| Less: Adjustment for non-controlling interest | 230 | 507 | |||||
| Adjusted EBITDA attributable to Diamondback Energy, Inc. | $ | 2,408 | $ | 7,520 | |||
ADJUSTED NET INCOME
Adjusted net income is a non-GAAP financial measure equal to net income (loss) attributable to Diamondback Energy, Inc. plus net income (loss) attributable to non-controlling interest ("net income (loss)") adjusted for non-cash (gain) loss on derivative instruments, net, (gain) loss on extinguishment of debt, merger and transaction expenses, other non-cash transactions and related income tax adjustments. The Company's computation of adjusted net income may not be comparable to other similarly titled measures of other companies or to such measure in our credit facility or any of our other contracts. Management believes adjusted net income helps investors in the oil and natural gas industry to measure and compare the Company's performance to other oil and natural gas companies by excluding from the calculation items that can vary significantly from company to company depending upon accounting methods, the book value of assets and other non-operational factors. Further, in order to allow investors to compare the Company's performance across periods, the Company excludes the effects of significant transactions that may affect earnings but are unpredictable in nature, timing and amount, although they may recur in different reporting periods.
The following table presents a reconciliation of the GAAP financial measure of net income (loss) attributable to Diamondback Energy, Inc. to the non-GAAP measure of adjusted net income:
Diamondback Energy, Inc. | |||||||
| Adjusted Net Income | |||||||
| (unaudited, $ in millions except per share data, shares in thousands) | |||||||
| Three Months Ended September 30, 2025 | |||||||
| Amounts | Amounts Per Diluted Share | ||||||
| Net income (loss) attributable to Diamondback Energy, Inc.(1) | $ | 1,018 | $ | 3.51 | |||
| Net income (loss) attributable to non-controlling interest | 65 | 0.23 | |||||
| Net income (loss)(1) | 1,083 | 3.74 | |||||
| Non-cash (gain) loss on derivative instruments, net | (60 | ) | (0.21 | ) | |||
| (Gain) loss on extinguishment of debt | 32 | 0.11 | |||||
| Merger and transaction expenses | 17 | 0.06 | |||||
| Other non-cash transactions | (121 | ) | (0.42 | ) | |||
| Adjusted net income excluding above items(1) | 951 | 3.28 | |||||
| Income tax adjustment for above items | 28 | 0.10 | |||||
| Adjusted net income(1) | 979 | 3.38 | |||||
| Less: Adjusted net income attributable to non-controlling interest | 84 | 0.30 | |||||
| Adjusted net income attributable to Diamondback Energy, Inc.(1) | $ | 895 | $ | 3.08 | |||
| Weighted average common shares outstanding: | |||||||
| Basic | 288,826 | ||||||
| Diluted | 288,826 | ||||||
(1) The Company's earnings (loss) per diluted share amount has been computed using the two-class method in accordance with GAAP. The two-class method is an earnings allocation which reflects the respective ownership among holders of common stock and participating securities. Diluted earnings per share using the two-class method is calculated as (i) net income attributable to Diamondback Energy, Inc, (ii) less the reallocation of $4 million in earnings attributable to participating securities, (iii) divided by diluted weighted average common shares outstanding for the respective periods.
OPERATING CASH FLOW BEFORE WORKING CAPITAL CHANGES, FREE CASH FLOW AND ADJUSTED FREE CASH FLOW
Operating cash flow before working capital changes, which is a non-GAAP financial measure, represents net cash provided by operating activities as determined under GAAP without regard to changes in working capital. The Company believes operating cash flow before working capital changes is a useful measure of an oil and natural gas company's ability to generate cash used to fund exploration, development and acquisition activities and service debt or pay dividends. The Company also uses this measure because changes in working capital relate to the timing of cash receipts and disbursements that the Company may not control and may not relate to the period in which the operating activities occurred. This allows the Company to compare its operating performance with that of other companies without regard to financing methods and capital structure.
The Company defines Free Cash Flow, which is a non-GAAP financial measure, as cash flow from operating activities before changes in working capital in excess of cash capital expenditures. The Company defines Adjusted Free Cash Flow, which is a non-GAAP financial measure, as Free Cash Flow before merger and transaction expenses, costs of early termination of derivatives and settlements of any treasury locks. The Company believes that Free Cash Flow and Adjusted Free Cash Flow are useful to investors as they provide a measure to compare both cash flow from operating activities and additions to oil and natural gas properties across periods on a consistent basis, adjusted, as applicable, for non-recurring impacts from divestitures, merger and transaction expenses, the early termination of derivative contracts and settlements of treasury locks. These measures should not be considered as an alternative to, or more meaningful than, net cash provided by operating activities as an indicator of liquidity. The Company's computation of Free Cash Flow may not be comparable to other similarly titled measures of other companies. Currently, the Board has approved a return of capital commitment of at least 50% of Adjusted Free Cash Flow to the Company's stockholders through repurchases under the share repurchase program, base dividends and variable dividends.
The following tables present a reconciliation of the GAAP financial measure of net cash provided by operating activities to the non-GAAP measure of operating cash flow before working capital changes and to the non-GAAP measures of Free Cash Flow and Adjusted Free Cash Flow:
Diamondback Energy, Inc. | |||||||
| Operating Cash Flow Before Working Capital Changes, Free Cash Flow and Adjusted Free Cash Flow | |||||||
| (unaudited, in millions) | |||||||
| Three Months Ended September 30, 2025 | Nine Months Ended September 30, 2025 | ||||||
| Net cash provided by operating activities | $ | 2,383 | $ | 6,415 | |||
| Less: Changes in cash due to changes in operating assets and liabilities: | |||||||
| Accounts receivable | (22 | ) | 138 | ||||
| Income tax receivable | - | 3 | |||||
| Prepaid expenses and other current assets | (49 | ) | (65 | ) | |||
| Accounts payable and accrued liabilities | 28 | (355 | ) | ||||
| Income taxes payable | (206 | ) | (515 | ) | |||
| Revenues and royalties payable | 58 | 28 | |||||
| Other | 40 | 54 | |||||
| Total working capital changes | (151 | ) | (712 | ) | |||
| Operating cash flow before working capital changes | 2,534 | 7,127 | |||||
| Additions to oil and natural gas properties | (774 | ) | (2,580 | ) | |||
| Total Cash CAPEX | (774 | ) | (2,580 | ) | |||
| Free Cash Flow | 1,760 | 4,547 | |||||
| Merger and transaction expenses(1) | 17 | 94 | |||||
| Early termination of derivatives | 15 | 67 | |||||
| Treasury locks | - | 1 | |||||
| Adjusted Free Cash Flow | $ | 1,792 | $ | 4,709 | |||
(1) Includes $15 million and $25 million of Viper's transaction expenses related to the Sitio Acquisition and the Drop Down for the three and nine months ended September 30, 2025, respectively.
NET DEBT
The Company defines the non-GAAP measure of net debt as total debt (excluding debt issuance costs, discounts, premiums and unamortized basis adjustments) less cash and cash equivalents and restricted cash that has been irrevocably deposited for the redemption of principal amounts of outstanding senior notes. Net debt should not be considered an alternative to, or more meaningful than, total debt, the most directly comparable GAAP measure. Management uses net debt to determine the Company's outstanding debt obligations that would not be readily satisfied by its cash and cash equivalents on hand. The Company believes this metric is useful to analysts and investors in determining the Company's leverage position because the Company has the ability to, and may decide to, use a portion of its cash and cash equivalents to reduce debt.
Diamondback Energy, Inc. | |||||||||||||||||||||||
| Net Debt | |||||||||||||||||||||||
| (unaudited, in millions) | |||||||||||||||||||||||
| September 30, 2025 | NetQ3Principal Borrowings/ (Repayments) | June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | ||||||||||||||||||
| (in millions) | |||||||||||||||||||||||
| Diamondback Energy, Inc.(1) | $ | 13,792 | $ | (420 | ) | $ | 14,212 | $ | 13,269 | $ | 12,069 | $ | 12,284 | ||||||||||
| Viper Energy, Inc.(1) | 2,640 | 1,535 | 1,105 | 830 | 1,091 | 830 | |||||||||||||||||
| Total debt | 16,432 | $ | 1,115 | 15,317 | 14,099 | 13,160 | 13,114 | ||||||||||||||||
| Cash and cash equivalents(2) | (539 | ) | (219 | ) | (1,816 | ) | (161 | ) | (370 | ) | |||||||||||||
| Net debt | $ | 15,893 | $ | 15,098 | $ | 12,283 | $ | 12,999 | $ | 12,744 | |||||||||||||
(1) Excludes debt issuance costs, discounts, premiums and unamortized basis adjustments.
(2) Cash and cash equivalents at September 30, 2025 includes $380 million of restricted cash which Viper irrevocably deposited with Computershare Trust Company, National Association in July 2025 for the redemption of the principal amount of Viper's 5.375% Senior Notes due 2027 on November 1, 2025.
DERIVATIVES
As of October 31, 2025, the Company had the following outstanding consolidated derivative contracts, including derivative contracts at Viper. The Company's derivative contracts are based upon reported settlement prices on commodity exchanges, with crude oil derivative settlements based on New York Mercantile Exchange West Texas Intermediate pricing and Crude Oil Brent pricing and with natural gas derivative settlements based on the New York Mercantile Exchange Henry Hub pricing. When aggregating multiple contracts, the weighted average contract price is disclosed.
| Crude Oil (Bbls/day, $/Bbl) | ||||||||||||||
| Q4 2025 | Q1 2026 | Q2 2026 | Q3 2026 | Q4 2026 | ||||||||||
| Long Puts - Crude Brent Oil | 46,000 | 36,000 | 22,000 | 5,000 | - | |||||||||
| Long Put Price ($/Bbl) | $53.91 | $53.13 | $52.50 | $52.50 | - | |||||||||
| Deferred Premium ($/Bbl) | $-1.64 | $-1.73 | $-1.73 | $-1.63 | - | |||||||||
| Long Puts - WTI (Magellan East Houston) | 100,000 | 95,000 | 60,000 | 15,000 | - | |||||||||
| Long Put Price ($/Bbl) | $53.00 | $51.13 | $50.00 | $50.00 | - | |||||||||
| Deferred Premium ($/Bbl) | $-1.68 | $-1.66 | $-1.66 | $-1.74 | - | |||||||||
| Long Puts - WTI (Cushing) | 176,000 | 175,000 | 80,000 | 10,000 | - | |||||||||
| Long Put Price ($/Bbl) | $53.79 | $51.83 | $49.53 | $50.00 | - | |||||||||
| Deferred Premium ($/Bbl) | $-1.64 | $-1.63 | $-1.66 | $-1.83 | - | |||||||||
| Basis Swaps - WTI (Midland) | 76,000 | 30,000 | 30,000 | 25,000 | 25,000 | |||||||||
| $1.05 | $0.96 | $0.96 | $0.95 | $0.95 | ||||||||||
| Roll Swaps - WTI | 65,000 | - | - | - | - | |||||||||
| $1.07 | - | - | - | - | ||||||||||
| Natural Gas (Mmbtu/day, $/Mmbtu) | ||||||||
| Q4 2025 | FY 2026 | FY 2027 | ||||||
| Costless Collars - Henry Hub | 690,000 | 840,000 | 580,000 | |||||
| Floor Price ($/Mmbtu) | $2.49 | $2.87 | $2.91 | |||||
| Ceiling Price ($/Mmbtu) | $5.28 | $6.35 | $6.37 | |||||
| Natural Gas Basis Swaps - Waha Hub | 610,000 | 650,000 | 300,000 | |||||
| $-0.98 | $-1.69 | $-1.35 | ||||||
| Natural Gas Basis Swaps - Houston Ship Channel | 20,000 | 100,000 | 120,000 | |||||
| $-0.49 | $-0.35 | $-0.25 | ||||||
Investor Contact:
Adam Lawlis
+1 432.221.7467
alawlis@diamondbackenergy.com
