Murphy Oil Swings to Q3 Loss Amid Impairments, Revenue Dip

Ticker: MUR · Form: 10-Q · Filed: Nov 5, 2025 · CIK: 717423

Sentiment: bearish

Topics: OilAndGas, EarningsMiss, AssetImpairment, DebtIncrease, EnergySector, ExplorationAndProduction, Q32025

Related Tickers: MUR, XOM, CVX, EOG

TL;DR

**MUR's Q3 loss and asset impairments are a red flag; expect continued pressure on the stock.**

AI Summary

Murphy Oil Corp (MUR) reported a net loss attributable to Murphy of $2.973 million for the three months ended September 30, 2025, a significant decline from a net income of $139.094 million in the same period of 2024. For the nine months ended September 30, 2025, net income attributable to Murphy was $92.343 million, down sharply from $356.835 million in the prior year. Total revenues and other income decreased to $732.985 million for the three months ended September 30, 2025, from $758.331 million in 2024, and to $2.094 billion for the nine months, down from $2.358 billion. This decline was primarily driven by a decrease in revenue from production, which fell from $753.169 million to $720.966 million for the quarter and from $2.345 billion to $2.077 billion for the nine-month period. Key cost increases include depreciation, depletion, and amortization, which rose to $283.465 million for the quarter from $223.632 million, and a substantial impairment of assets totaling $115.002 million for both the three and nine-month periods in 2025, compared to zero in the prior year's quarter and $34.528 million for the nine-month period in 2024. The company also saw an increase in long-term debt to $1.425 billion as of September 30, 2025, from $1.275 billion at December 31, 2024.

Why It Matters

Murphy Oil's swing to a net loss and significant revenue decline signals potential headwinds for investors, impacting dividend sustainability and future growth prospects. The substantial asset impairment of $115.002 million suggests a re-evaluation of asset values, which could affect the company's balance sheet strength and investor confidence. For employees, this financial performance might lead to cost-cutting measures or slower expansion. In a competitive energy market, Murphy's reduced profitability could weaken its position against larger, more diversified players, potentially affecting its ability to invest in new projects and maintain market share. Customers might not see direct immediate impacts, but sustained underperformance could influence long-term supply stability.

Risk Assessment

Risk Level: high — The company reported a net loss of $2.973 million for the three months ended September 30, 2025, a stark contrast to a $139.094 million net income in the prior year. This is compounded by a significant $115.002 million impairment of assets in 2025, compared to zero in the same quarter of 2024, indicating potential overvaluation or underperformance of assets. Long-term debt also increased by $150.733 million to $1.425 billion from December 31, 2024, raising concerns about leverage.

Analyst Insight

Investors should consider reducing exposure to MUR given the swing to a net loss and substantial asset impairments. Monitor future filings for signs of improved operational efficiency and a reduction in debt, as these are critical for a turnaround.

Financial Highlights

debt To Equity
0.86
revenue
$732,985,000
operating Margin
-14.7%
total Assets
$9,732,762,000
total Debt
$2,343,983,000
net Income
-$2,973,000
eps
-$0.02
gross Margin
25.5%
cash Position
$425,960,000
revenue Growth
-3.3%

Revenue Breakdown

SegmentRevenueGrowth
United States - Onshore Crude Oil and Condensate$209,051,000+29.1%
United States - Offshore Crude Oil and Condensate$356,903,000-10.7%
Canada - Onshore Crude Oil and Condensate$18,115,000-13.1%
Canada - Offshore Crude Oil and Condensate$35,211,000-56.1%
United States - Onshore Natural Gas$9,571,000+124.4%
United States - Offshore Natural Gas$15,741,000+27.9%

Key Numbers

Key Players & Entities

FAQ

What caused Murphy Oil Corp's net loss in Q3 2025?

Murphy Oil Corp reported a net loss attributable to Murphy of $2.973 million for the three months ended September 30, 2025, primarily due to a $115.002 million impairment of assets and a decrease in total revenues and other income to $732.985 million from $758.331 million in Q3 2024.

How did Murphy Oil's revenue from production change year-over-year?

Revenue from production for Murphy Oil Corp decreased to $720.966 million for the three months ended September 30, 2025, from $753.169 million in the same period of 2024. For the nine months, it fell to $2.077 billion from $2.345 billion.

What was the impact of asset impairments on Murphy Oil's financials?

Murphy Oil Corp recorded an impairment of assets totaling $115.002 million for both the three and nine months ended September 30, 2025. This significantly contributed to the net loss in Q3 2025, as no impairment was recorded in Q3 2024 and only $34.528 million for the nine months ended September 30, 2024.

Did Murphy Oil's debt levels change in 2025?

Yes, Murphy Oil Corp's long-term debt, including finance lease obligation, increased to $1.425 billion as of September 30, 2025, from $1.275 billion at December 31, 2024, representing an increase of $150.733 million.

How did Murphy Oil's cash flow from operations perform in the first nine months of 2025?

Net cash provided by continuing operations activities for Murphy Oil Corp was $998.162 million for the nine months ended September 30, 2025, a decrease from $1.295 billion in the same period of 2024.

What were Murphy Oil's exploration expenses for the nine months ended September 30, 2025?

Murphy Oil Corp's exploration expenses, including undeveloped lease amortization, were $57.389 million for the nine months ended September 30, 2025, a decrease from $118.390 million in the same period of 2024.

What is Murphy Oil's outlook on new accounting pronouncements?

Murphy Oil Corp expects the new ASU 2024-03 on Expense Disaggregation Disclosures and ASU 2023-09 on Income Tax Disclosures to only impact its disclosures, with no material impact on its results of operations, cash flows, and financial condition.

How much did Murphy Oil pay in cash dividends per common share in Q3 2025?

Murphy Oil Corp paid cash dividends of $0.325 per common share for the three months ended September 30, 2025, an increase from $0.300 per common share in the same period of 2024.

What were the changes in Murphy Oil's total assets and liabilities?

Murphy Oil Corp's total assets increased to $9.733 billion as of September 30, 2025, from $9.667 billion at December 31, 2024. Total liabilities also increased to $4.483 billion from $4.326 billion over the same period.

Where does Murphy Oil Corp primarily generate its revenue from production?

Murphy Oil Corp primarily generates revenue from crude oil and condensate production in the United States Offshore, which accounted for $356.903 million in Q3 2025 and $1.052 billion for the nine months ended September 30, 2025.

Risk Factors

Industry Context

The oil and gas industry is characterized by high capital intensity, cyclical commodity prices, and significant regulatory oversight. Murphy Oil operates in a competitive landscape, facing pressure from both large integrated oil companies and smaller independent producers. Trends include a focus on optimizing production from existing assets, managing environmental, social, and governance (ESG) factors, and navigating the energy transition.

Regulatory Implications

Murphy Oil is subject to extensive environmental regulations governing emissions, waste disposal, and land use, which can lead to compliance costs and potential penalties. Changes in tax laws or production-related regulations in the U.S. and Canada could also impact profitability and operational decisions. The company's asset retirement obligations, totaling over $1 billion, highlight the long-term financial commitments associated with environmental stewardship.

What Investors Should Do

  1. Monitor commodity price trends closely.
  2. Analyze the drivers of increased DD&A and asset impairments.
  3. Assess the impact of increased long-term debt.
  4. Evaluate the sustainability of dividends in light of declining profitability.

Key Dates

Glossary

Depreciation, Depletion and Amortization (DD&A)
Non-cash expenses that represent the reduction in the value of a company's oil and gas reserves and other assets over time due to extraction and usage. (An increase in DD&A to $283.465 million for the quarter indicates higher extraction activity or potential asset value reductions.)
Impairment of Assets
A charge taken when the carrying value of an asset on the balance sheet exceeds its recoverable amount, indicating a permanent reduction in its value. (A substantial $115.002 million impairment charge in 2025 signals potential issues with the future economic benefits of certain company assets.)
Revenue from Production
The income generated from the sale of crude oil, natural gas, and natural gas liquids extracted by the company. (A decrease in revenue from production to $720.966 million for the quarter reflects lower sales volumes or prices.)
Long-term Debt
Financial obligations that are due more than one year from the balance sheet date. (An increase in long-term debt to $1.425 billion suggests the company has taken on more borrowing, potentially for investments or to cover operational needs.)
Net Income (Loss) Attributable to Murphy
The portion of the company's profit or loss that belongs to its common shareholders after accounting for all expenses, taxes, and noncontrolling interests. (The shift from a net income of $139.094 million in Q3 2024 to a net loss of $2.973 million in Q3 2025 highlights a significant deterioration in profitability.)
Accumulated Other Comprehensive Loss
A component of equity that includes unrealized gains and losses on certain financial instruments and foreign currency translation adjustments that are not included in net income. (The balance of $(574,931,000)$ reflects cumulative unrealized losses impacting the company's equity.)

Year-Over-Year Comparison

Murphy Oil Corporation experienced a significant downturn in financial performance compared to the prior year. For the three months ended September 30, 2025, the company reported a net loss of $2.973 million, a stark contrast to the $139.094 million net income in the same period of 2024. Total revenues also decreased by 3.3% to $732.985 million. Key cost increases include a substantial rise in depreciation, depletion, and amortization expenses and a significant impairment of assets totaling $115.002 million, which were not present or were much lower in the prior year. Long-term debt has also increased by $150 million since year-end 2024.

Filing Stats: 4,581 words · 18 min read · ~15 pages · Grade level 16.9 · Accepted 2025-11-05 17:00:24

Key Financial Figures

Filing Documents

– Financial Information

Part I – Financial Information 2

Financial Statements

Item 1. Financial Statements 2 Consolidated Balance Sheets 2 Consolidated Statements of Operations 3 Consolidated Statements of Comprehensive Income 4 Consolidated Statements of Cash Flows 5 Consolidated Statements of Stockholders' Equity 6

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 7 Note A – Basis of Presentation 7 Note B – New Accounting Principles and Recent Accounting Pronouncements 7 Note C – Revenue from Contracts with Customers 8 Note D – Property, Plant and Equipment 10 Note E – Financing Arrangements and Debt 12 Note F – Other Financial Information 12 Note G – Asset Retirement Obligations 13 Note H – Employee and Retiree Benefit Plans 13 Note I – Incentive Plans 14 Note J – Net Income (Loss) Per Common Share 16 Note K – Income Taxes 16 Note L – Financial Instruments and Risk Management 17 Note M – Accumulated Other Comprehensive Loss 20 Note N – Environmental and Other Contingencies 21 Note O – Common Stock Issued and Outstanding 22 Note P – Business Segments 23 Note Q – Leases 28

Management's Discussion and Analysis of Financial Condition and Results of

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 29

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 49

Controls and Procedures

Item 4. Controls and Procedures 49

– Other Information

Part II – Other Information 50

Legal Proceedings

Item 1. Legal Proceedings 50

Risk Factors

Item 1A. Risk Factors 50

Other Information

Item 5. Other Information 51

Exhibits

Item 6. Exhibits 51 Signature 52 1 Table of Contents

– FINANCIAL INFORMATION

PART I – FINANCIAL INFORMATION

FINANCIAL STATEMENTS

ITEM 1. FINANCIAL STATEMENTS MURPHY OIL CORPORATION AND CONSOLIDATED SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Thousands of dollars, except share amounts) September 30, 2025 December 31, 2024 ASSETS Current assets Cash and cash equivalents $ 425,960 $ 423,569 Accounts receivable, net 283,744 272,530 Inventories 62,147 54,858 Prepaid expenses 35,629 34,322 Total current assets 807,480 785,279 Property, plant and equipment, at cost less accumulated depreciation, depletion and amortization of $ 14,762,292 in 2025 and $ 13,811,539 in 2024 8,085,731 8,054,653 Operating lease assets 781,291 777,536 Deferred charges and other assets 58,260 50,011 Total assets $ 9,732,762 $ 9,667,479 LIABILITIES AND EQUITY Current liabilities Current maturities of long-term debt, finance lease $ 918 $ 871 Accounts payable 429,658 472,165 Income taxes payable 20,987 19,003 Other taxes payable 31,573 31,685 Operating lease liabilities 210,769 253,208 Other accrued liabilities 117,965 117,802 Current asset retirement obligations 45,876 48,080 Total current liabilities 857,746 942,814 Long-term debt, including finance lease obligation 1,425,235 1,274,502 Asset retirement obligations 1,001,919 960,804 Deferred credits and other liabilities 249,521 274,345 Non-current operating lease liabilities 582,082 537,381 Deferred income taxes 366,607 335,790 Total liabilities $ 4,483,110 $ 4,325,636 Equity Cumulative Preferred Stock, par $ 100 , authorized 400,000 shares, none issued $ — $ — Common Stock, par $ 1.00 , authorized 450,000,000 shares, issued 195,100,628 shares at September 30, 2025 and 195,100,628 shares at December 31, 2024 195,101 195,101 Capital in excess of par value 850,964 848,950 Retained earnings 6,725,833 6,773,289 Accumulated other comprehensive loss ( 574,931 ) ( 628,072 ) Treasury stock ( 2,075,580 ) ( 1,995,018 ) Murphy Shareholders' Equity 5,121,387 5,194,250 Noncontrolling interest 128,265 147,593 Total equity 5,249

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS These notes are an integral part of the financial statements of Murphy Oil Corporation and Consolidated Subsidiaries (the Company or Murphy) on pages 2 through 6 of this Form 10-Q report. Note A – Basis of Presentation The unaudited financial statements presented herein, in the opinion of Murphy's management, include all adjustments necessary to present fairly the Company's financial position as at September 30, 2025 and December 31, 2024, and the results of operations, cash flows and changes in stockholders' equity for the interim periods ended September 30, 2025 and 2024, in conformity with U.S. generally accepted accounting principles (GAAP). In preparing the financial statements of the Company in conformity with GAAP, management has made a number of estimates and assumptions that affect the reporting of assets, liabilities, revenues, and expenses and the disclosure of contingent assets and liabilities. Actual results may differ from the estimates. Consolidated financial statements and notes to consolidated financial statements included in this Form 10-Q report should be read in conjunction with the Company's 2024 Form 10-K report, as certain notes and other pertinent information have been abbreviated or omitted in this report. Financial results for the three-month and nine-month periods ended September 30, 2025 are not necessarily indicative of future results. Note B – New Accounting Principles and Recent Accounting Pronouncements Accounting Principles Adopted Reportable Segment Disclosures. In November 2023, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-07 Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures . The standard requires additional disclosures about operating segments, including segment expense information provided to the chief operating decision maker, and extends certain disclosure requirements to interim periods. The Company

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Note C – Revenue from Contracts with Customers Nature of Goods and Services The Company explores for and produces crude oil, natural gas and natural gas liquids (collectively referred to as oil and natural gas) in select basins around the world. The Company's revenue from sales of oil and natural gas production activities is primarily subdivided into two key geographic segments: the United States (U.S.) and Canada. Additionally, revenue from sales to customers is generated from three primary revenue streams: crude oil, natural gas and natural gas liquids (NGLs). For operated oil and natural gas production where a non-operated working interest owner does not take in kind its proportionate interest in the produced commodity, the Company acts as an agent for the working interest owner and recognizes revenue only for its own share of the commingled production. The exception to this is the reporting of the noncontrolling interest (NCI) in MP Gulf of Mexico, LLC (MP GOM) as prescribed by GAAP. U.S. - In the U.S., the Company primarily produces oil and natural gas from fields in the Eagle Ford Shale area of South Texas and in the Gulf of America. Revenue is generally recognized when oil and natural gas is transferred to the customer at the delivery point. Revenue recognized is largely index-based with price adjustments for floating market differentials. Canada - In Canada, contracts include long-term floating commodity index priced and natural gas physical forward sales fixed price contracts. For the offshore business in Canada, contracts are based on index prices and revenue is recognized at the time of vessel load based on the volumes on the bill of lading and point of custody transfer. The Company also purchases natural gas in Canada to meet certain sales commitments. Disaggregation of Revenue The Company reviews performance based on two key geographical segments and between onshore and offshore sources of

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Note C - Revenue from Contracts with Customers (Continued) The Company's revenues and other income for the three-month and nine-month periods ended September 30, 2025 and 2024 were as follows. Three Months Ended September 30, Nine Months Ended September 30, (Thousands of dollars) 2025 2024 2025 2024 Net crude oil and condensate revenue United States - Onshore $ 209,051 $ 161,965 $ 484,610 $ 450,463 United States - Offshore 1 356,903 399,940 1,052,345 1,382,071 Canada - Onshore 18,115 20,852 45,428 54,305 Canada - Offshore 35,211 80,226 155,421 178,327 Other 88 ( 795 ) 3,036 3,414 Total crude oil and condensate revenue 619,368 662,188 1,740,840 2,068,580 Net natural gas liquids revenue United States - Onshore 13,736 8,134 32,117 23,281 United States - Offshore 1 8,353 9,812 25,913 29,523 Canada - Onshore 1,094 2,402 4,363 5,434 Total natural gas liquids revenue 23,183 20,348 62,393 58,238 Net natural gas revenue United States - Onshore 9,571 4,265 25,637 11,893 United States - Offshore 1 15,741 12,311 52,408 35,700 Canada - Onshore 53,103 54,057 195,483 170,871 Total natural gas revenue 78,415 70,633 273,528 218,464 Revenue from production 720,966 753,169 2,076,761 2,345,282 Sales of purchased natural gas 2 Canada - Onshore — — — 3,742 Total sales of purchased natural gas — — — 3,742 Total revenue from sales to customers 720,966 753,169 2,076,761 2,349,024 Gain (loss) on derivative instruments 5,722 ( 1,344 ) 7,071 ( 1,344 ) Gain on sale of assets and other operating income 6,297 6,506 10,434 9,834 Total revenues and other income $ 732,985 $ 758,331 $ 2,094,266 $ 2,357,514 1 Includes revenue attributable to noncontrolling interest in MP GOM. 2 Purchases of natural gas are reported on a gross basis when Murphy takes control of the product and has risks and rewards of ownership. Sales of purchased natural gas are reported when the contractual performance obligatio

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Note C – Revenue from Contracts with Customers (Continued) Performance Obligations The Company recognizes oil and natural gas revenue when it satisfies a performance obligation by transferring control over a commodity to a customer. Judgment is required to determine whether some customers simultaneously receive and consume the benefit of commodities. As a result of this assessment for the Company, each unit of measure of the specified commodity is considered to represent a distinct performance obligation that is satisfied at a point in time upon the transfer of control of the commodity. For contracts with market or index-based pricing, which represent the majority of sales contracts, the Company has elected the allocation exception and allocates the variable consideration to each single performance obligation in the contract. As a result, there is no price allocation to unsatisfied remaining performance obligations for delivery of commodity product in subsequent periods. The Company has entered into several long-term, fixed price contracts in Canada. The underlying reason for entering a fixed price contract is generally unrelated to anticipated future prices or other observable data and serves a particular purpose in the Company's long-term strategy. As of September 30, 2025, the Company had the following sales contracts in place which are expected to generate revenue from sales to customers for a period over 12 months starting at the inception of the contract: Location Commodity End Date Description Approximate Volumes U.S. Natural Gas and NGLs Q2 2030 Deliveries from dedicated acreage in Eagle Ford Shale As produced Canada Natural Gas Q4 2025 Contracts to sell natural gas at USD index pricing 25 MMCFD Canada Natural Gas Q4 2026 Contracts to sell natural gas at USD index pricing 49 MMCFD Canada Natural Gas Q4 2027 Contracts to sell natural gas at USD index pricing 30 MMCFD Canada Natural Gas Q4 20

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) Note D – Property, Plant and Equipment (Continued) exploration wells in the Gulf of America and long-lead equipment for Bubale-1X (Block CI-709), Civette-1X (Block CI-502), and Caracal-1X (Block CI-102) exploration wells in Cte d'Ivoire. Capital additions of $ 28.5 million, for the nine months ended September 30, 2024, were mainly for the non-operated Ocotillo #1 (Mississippi Canyon 40) exploration well in the Gulf of America and Hai Su Vang-1X (Golden Sea Lion), Block 15-2/17; and Lac Da Hong-1X (Pink Camel), Block 15-1/05 exploration wells in Vietnam. There were no capitalized well costs charged to dry hole expense for the nine months ended September 30, 2025. Capitalized well costs charged to dry hole expense of $ 26.5 million for the nine months ended September 30, 2024 were primarily related to the Hoffe Park #1 (Mississippi Canyon 166) exploration well in the Gulf of America. The preceding table excludes well costs of $ 43.0 million incurred and expensed directly to dry hole for the nine months ended September 30, 2024. These costs primarily included $ 25.8 million for the non-operated Orange #1 (Mississippi Canyon 216) and $ 11.8 million for the Sebastian #1 (Mississippi Canyon 387) exploration wells in the Gulf of America. The following table provides an aging of capitalized exploration well costs based on the date the drilling was completed for each individual well. September 30, 2025 2024 (Thousands of dollars) Amount No. of Wells Amount No. of Wells Aging of capitalized well costs: Zero to one year $ 17,562 5 $ 28,552 3 One to two years 75,171 3 — — Two to three years — — — — Three years or more 22,413 3 22,547 3 $ 115,1

View Full Filing

View this 10-Q filing on SEC EDGAR

View on Read The Filing