SM Energy Company reported its financial results for the third quarter of 2025, revealing a total operating revenue of $811.6 million, a 26% increase from $643.6 million in the same quarter of 2024. The company's net income for the quarter was $155.1 million, or $1.35 per diluted share, down from $240.5 million, or $2.10 per diluted share, in the prior year. For the nine months ended September 30, 2025, total operating revenue reached $2.45 billion, compared to $1.84 billion in the same period of 2024, while net income was $539 million, down from $582 million year-over-year.
The company experienced significant changes in its financial performance compared to the previous fiscal period, particularly in production revenue, which increased by 33% year-to-date, primarily driven by the addition of production from the Uinta Basin assets acquired in October 2024. However, net income decreased due to higher operating expenses, including a 61% increase in oil, gas, and NGL production expenses, which rose to $678.1 million for the nine months ended September 30, 2025, compared to $422.4 million in the same period of 2024.
Strategically, SM Energy announced a merger agreement with Civitas Resources, Inc. on November 2, 2025, which is expected to enhance operational scale and unlock synergies. The merger, which has been approved by both companies' boards, is subject to shareholder and regulatory approvals and is anticipated to close in the first quarter of 2026. This acquisition aligns with SM Energy's strategy to expand its portfolio and enhance its operational capabilities in key regions.
Operationally, the company reported an average net daily equivalent production of 213.8 MBOE for the third quarter, a slight increase from 209.1 MBOE in the previous quarter. The production mix included 10.5 million barrels of oil, 38.5 billion cubic feet of gas, and 2.8 million barrels of NGLs. The Uinta Basin assets contributed significantly to this increase, with production from this area accounting for 44.0 MBOE per day. The company also continued its stock repurchase program, retiring approximately 0.4 million shares at a cost of $12.1 million during the quarter.
Looking ahead, SM Energy remains focused on optimizing operations and development to sustain value from its core assets. The company plans to fund its capital expenditures, projected at approximately $1.375 billion for 2025, primarily through cash flows from operations and available borrowing capacity under its revolving credit facility. The company is also monitoring market conditions, including commodity price volatility and potential impacts from geopolitical events, as it navigates its operational and financial strategies.
About SM Energy Co
SM Energy is an independent energy company engaged in the acquisition, exploration, development, and production of oil, gas, and NGLs primarily in Texas and Utah. It operates high-quality assets in the Midland, South Texas, and Uinta Basins, focusing on sustainable growth, operational efficiency, and stakeholder value. The company emphasizes safety, ESG initiatives, and strategic acquisitions to optimize reserves and generate cash flows.
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