Magnolia Oil & Gas (MGY) Q2 2025 earnings summary

Executive summary

• Achieved record Q2 2025 production of 98.2 Mboe/d, up 9% year-over-year, with oil production at 40.0 Mbbls/d, up 5%.

• Adjusted net income was $81 million and adjusted EBITDAX reached $223 million, both down year-over-year due to lower oil prices.

• Completed bolt-on acquisitions totaling $40 million, adding 18,000 net acres and ~500 BOE/d in Giddings, expanding development area by 20%.

• Raised full-year 2025 production growth guidance to ~10% from prior 7%-9% range, driven by strong well performance.

• Maintained disciplined capital allocation, prioritizing reinvestment for moderate growth and returning capital via dividends and share repurchases.

Financial highlights

• Q2 2025 revenues were $319 million, down 5% year-over-year, mainly due to a 22% drop in oil prices.

• Free cash flow totaled $107 million, up 11% year-over-year, with 72% ($78 million) returned to shareholders.

• D&C capital spending was $95 million, a 23% decrease year-over-year and 43% reinvestment rate.

• Ended Q2 with $252 million in cash and $700 million in total liquidity.

• Operating income margin was 34%; annualized ROCE was 18%.

Outlook and guidance

• Full-year 2025 production growth guidance raised to ~10%; D&C capital spending reiterated at $430–$470 million.

• Q3 2025 production expected at ~99 Mboe/d; D&C capital spending estimated at $115 million.

• Effective tax rate expected at 21%, with minimal cash taxes for 2025 and likely 2026 due to new legislation.

• Management expects to continue spending within cash flow, maintaining low leverage, and focusing on moderate, predictable annual volume growth.

• LOE expected to normalize to ~$5.25/boe in H2 2025, about 5% below 2024 levels.