Shell (NYSE: SHEL) posted better-than-expected earnings for the second quarter, as reduced expenses and higher marketing margins partly offset lower oil and gas prices and weaker trading results.
Shell on Thursday reported adjusted earnings of $4.26 billion for the second quarter, down by 24% from the first quarter and down 32% from a year earlier. Still, the earnings beat the analyst consensus estimate of about $3.7 billion.
Following the results release, Shell’s shares popped 3% at the start of trade in London on Thursday.
The Q2 2025 earnings reflected lower trading and optimization margins and lower realized liquids and gas prices, partly offset by higher Marketing margins and lower operating expenses, Shell said in a statement.
The UK-based supermajor has already flagged “significantly lower” trading and optimization results for the second quarter compared to the prior quarter, while it also slightly reduced the range of its natural gas and LNG production for the April-June period.
Shell had expected the adjusted earnings of the Chemicals & Products segment to be below break-even in the second quarter. However, the full results showed today adjusted earnings of $118 million, as large losses in trading and lower chemicals margins were partly offset by favorable tax movements and lower operating expenses.
“Shell generated robust cash flows reflecting strong operational performance in a less favourable macro environment,” CEO Wael Sawan said.
“Our continued focus on performance, discipline and simplification helped deliver $3.9 billion of structural cost reductions since 2022, with the majority delivered through non-portfolio actions,” added the executive, who has vowed to cut costs and simplify corporate structure.
In March, Shell pledged to boost shareholder distributions in a strategy to deliver more to investors focused on its strengths—raising LNG production and sales and sustaining oil production at current levels through 2030.
Today, the company announced it would begin another $3.5 billion of buybacks for the next three months, which would be the 15th consecutive quarter of at least $3 billion in buybacks.
By Tsvetana Paraskova for Oilprice.com
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