Matador Resources Company (MTDR) Q4 2025 earnings summary

Executive summary

• Achieved record daily production of 211,290 BOE/d in Q4 2025, with a 23% CAGR since 2020 and a 1% sequential and 5% year-over-year increase.

• Proved reserves increased 9% year-over-year to 667 MMBOE as of December 31, 2025, marking a record year for reserves and profitability.

• Maintained a strong balance sheet, reduced debt by $200 million, and achieved robust cash flow despite commodity price volatility.

• Focused on value creation through capital and operational efficiency, prioritizing profitability, reserve growth, and midstream value.

• Maintained high-quality inventory with 10–15 years of drilling locations across 212,500 net acres in the Delaware Basin.

Financial highlights

• Full-year 2025 oil and natural gas revenues reached $3.24 billion, with adjusted free cash flow of $437 million and adjusted EBITDA of $2.29 billion.

• Reduced CapEx by 11% year-over-year while maintaining similar production levels and increasing reserves.

• Drilling and completion costs per lateral foot decreased to $795 in 2025, down from $1,075 in 2023, with $130 million in D&C capital savings for 2026.

• Dividend yield at 2.9–3%, with dividends raised seven times in four years and share buybacks initiated and used opportunistically.

• Net debt/LTM Adjusted EBITDA at year-end 2025 was ~1.1x, with over $1.8 billion in liquidity.

Outlook and guidance

• 2026 plan targets 3% oil production growth with 11% lower CapEx, emphasizing free cash flow and operational efficiency.

• 2026 guidance: 125 gross (107.6 net) operated wells and 194 gross (11.9 net) non-operated wells to be turned to sales.

• Drilling and completion costs per lateral foot projected to decline 6% in 2026, with a 13% reduction in well cycle times.

• No uplift from surfactant pilot tests included in 2026 production guidance, though early results are promising and capital is budgeted for further testing.

• Q1 2026 expected to be the lowest production quarter, with significant increase in Q2 as batch developments ramp up.