Diamondback Energy (FANG) Q1 2026 earnings summary

Executive summary

• Achieved average oil production of 521.0 MBO/d (979.4 MBOE/d) in Q1 2026, reflecting strong operational performance and exceeding expectations due to well optimization and reduced downtime.

• Net cash from operating activities was $1.8 billion, with free cash flow of $1.7 billion and adjusted EBITDA of $3.0 billion.

• Net income for Q1 2026 was $25 million, impacted by a $1.4 billion non-cash impairment on proved oil and gas properties.

• Capital allocation prioritized rapid debt reduction, steady dividends, opportunistic buybacks, and flexible returns, with M&A activity expected to be quiet.

• Guidance for oil production set at 520+ MBO/d as a new baseline, with potential for further growth depending on macro conditions.

Financial highlights

• Q1 2026 net income attributable to shareholders was $25 million ($0.08 per diluted share); adjusted net income was $1.2 billion ($4.23 per diluted share).

• Dividend increased to $1.10/share in Q2 2026, up 10% year-over-year, and $859 million was returned to shareholders (~50% of adjusted free cash flow).

• 3.3 million shares repurchased for $548 million in Q1 2026, with $2.1 billion remaining under the $8.0 billion buyback program.

• Lease operating expenses averaged $6.21/BOE, and total cash operating expenses were $11.26/BOE.

• Q1 2026 total revenues were $4.24 billion, up from $4.05 billion in Q1 2025, driven by 15% higher production volumes.

Outlook and guidance

• 2026 oil production guidance raised to 520+ MBO/d (from 500–510), with total BOE guidance at 972+ MBOE/d and CAPEX budget increased to ~$3.90 billion.

• Q2 2026 oil production guidance is 515–525 MBO/d (950–990 MBOE/d); Q2 cash capital expenditures guidance is $925–$1,025 million.

• No appetite for double-digit production growth; focus remains on capital efficiency and steady, sustainable growth.

• Activity and capital allocation decisions will be made quarter-by-quarter, responding to market volatility and investor sentiment.