Occidental's Q3 Profit Plunges 36% Amid Debt Reduction Push

TL;DR

OXY's profit is down significantly, but they're aggressively paying down debt, making it a mixed bag for investors.

AI Summary

Occidental Petroleum Corporation reported a significant decline in net income attributable to common stockholders for the nine months ended September 30, 2025, falling to $1,715 million from $2,674 million in the prior year, a decrease of 35.8%. Diluted EPS also dropped to $1.68 from $2.77. Net sales for the nine-month period slightly decreased to $19,841 million from $19,965 million in 2024. For the three months ended September 30, 2025, net sales were $6,624 million, down from $7,173 million in the same period of 2024. The company's long-term debt, net, decreased substantially to $20,846 million as of September 30, 2025, from $24,978 million at December 31, 2024, indicating a focus on debt reduction. Cash and cash equivalents saw a modest increase to $2,159 million from $2,132 million. Capital expenditures increased to $5,674 million for the nine months ended September 30, 2025, compared to $5,237 million in the prior year. A joint venture with BlackRock for a direct air capture facility is progressing, with BlackRock having invested $453 million of its $550 million commitment. The company also saw a decrease in net cash provided by operating activities to $7,898 million from $8,083 million year-over-year.

Why It Matters

Occidental's substantial 35.8% drop in net income attributable to common stockholders, despite a slight dip in net sales, signals potential headwinds for investors, particularly given the increased capital expenditures. The significant reduction in long-term debt by over $4 billion is a positive for financial stability, but the impact on future profitability needs close monitoring. For employees, the ongoing investment in the direct air capture facility with BlackRock highlights a strategic pivot towards new energy technologies, potentially creating new opportunities. Customers might see stable pricing given the relatively flat sales, while the broader market will watch how OXY balances traditional oil and gas operations with its carbon capture initiatives, especially in a competitive energy landscape.

Risk Assessment

Risk Level: medium — The 35.8% decrease in net income attributable to common stockholders for the nine months ended September 30, 2025, to $1,715 million from $2,674 million in 2024, indicates a notable decline in profitability. While long-term debt decreased by $4,132 million, the substantial drop in earnings per share from $2.77 to $1.68 suggests potential operational or market challenges impacting the bottom line.

Analyst Insight

Investors should closely monitor Occidental's upcoming earnings calls for detailed explanations on the profit decline and the long-term strategy for the direct air capture facility. Consider the implications of increased capital expenditures on future free cash flow and evaluate if the debt reduction offsets the lower profitability.

Financial Highlights

debt To Equity

0.57

revenue

$19,841 million

operating Margin

N/A

total Assets

$83,472 million

total Debt

$20,846 million

net Income

$1,715 million

eps

$1.68

gross Margin

N/A

cash Position

$2,159 million

revenue Growth

-0.7%

Revenue Breakdown

Key Numbers

• $1.715B — Net Income Attributable to Common Stockholders (Decreased 35.8% from $2.674B in 2024 for the nine months ended September 30.)
• $1.68 — Diluted EPS (Decreased from $2.77 in 2024 for the nine months ended September 30.)
• $19.841B — Net Sales (Slightly decreased from $19.965B in 2024 for the nine months ended September 30.)
• $20.846B — Long-Term Debt, Net (Reduced by $4.132B from $24.978B at December 31, 2024.)
• $5.674B — Capital Expenditures (Increased from $5.237B in 2024 for the nine months ended September 30.)
• $453M — BlackRock Investment (Amount invested in direct air capture facility as of September 30, 2025, out of a $550M commitment.)
• $7.898B — Net Cash Provided by Operating Activities (Decreased from $8.083B in 2024 for the nine months ended September 30.)
• 985,210,434 — Common Stock Shares Outstanding (As of October 31, 2025.)

Key Players & Entities

• OCCIDENTAL PETROLEUM CORPORATION (company) — Registrant
• BlackRock Inc. (company) — Joint venture partner for direct air capture facility
• CrownRock, L.P. (company) — Acquisition target
• U.S. Securities and Exchange Commission (regulator) — Governing body for filings
• $1,715 million (dollar_amount) — Net income attributable to common stockholders for nine months ended September 30, 2025
• $2,674 million (dollar_amount) — Net income attributable to common stockholders for nine months ended September 30, 2024
• $20,846 million (dollar_amount) — Long-term debt, net, as of September 30, 2025
• $24,978 million (dollar_amount) — Long-term debt, net, as of December 31, 2024
• $5,674 million (dollar_amount) — Capital expenditures for nine months ended September 30, 2025
• $453 million (dollar_amount) — BlackRock's investment in direct air capture facility as of September 30, 2025

FAQ

Risk Factors

• Commodity Price Volatility [high — market]: The company's financial performance is highly sensitive to fluctuations in the prices of oil and natural gas. For the nine months ended September 30, 2025, net sales were $19,841 million, a slight decrease from $19,965 million in the prior year, reflecting the impact of price volatility.
• Debt Management [medium — financial]: Occidental Petroleum has significant long-term debt, which stood at $20,846 million as of September 30, 2025. While this represents a reduction from $24,978 million at December 31, 2024, managing this debt burden is crucial for financial flexibility.
• Capital Expenditure Intensity [medium — operational]: The company increased its capital expenditures to $5,674 million for the nine months ended September 30, 2025, up from $5,237 million in the prior year. Significant ongoing investments are required to maintain and grow production, posing operational and financial risks.
• Environmental Regulations [medium — regulatory]: The company faces stringent environmental regulations related to its operations, including asset retirement obligations. Environmental liabilities were $3,856 million as of September 30, 2025. Non-compliance or changes in regulations could lead to significant costs.
• Global Economic Conditions [medium — market]: Demand for oil and gas is tied to global economic activity. A slowdown in the global economy could reduce demand and negatively impact prices and sales volumes, as seen in the slight decrease in net sales to $19,841 million for the nine months ended September 30, 2025.
• Joint Venture Execution [low — operational]: The success of strategic initiatives, such as the direct air capture facility joint venture with BlackRock, which has received $453 million of a $550 million commitment, is critical. Delays or underperformance in these ventures could impact future growth and profitability.

Industry Context

Occidental Petroleum operates in the highly competitive and capital-intensive oil and gas industry. The sector is characterized by significant price volatility driven by global supply and demand dynamics, geopolitical events, and macroeconomic trends. Companies like Occidental are increasingly focused on optimizing production, managing costs, and investing in lower-carbon solutions to navigate the energy transition.

Regulatory Implications

The oil and gas industry is subject to extensive environmental, health, and safety regulations. Occidental Petroleum must comply with regulations concerning emissions, waste disposal, and land use, which can impact operational costs and require significant capital investment for compliance and remediation. Changes in climate policy and environmental standards pose ongoing risks.

What Investors Should Do

1. Monitor commodity price trends
2. Analyze debt reduction progress
3. Evaluate capital allocation strategy
4. Assess operational efficiency and cost management

Key Dates

• 2025-09-30: Nine months ended September 30, 2025 Financial Results — Reported a 35.8% decrease in net income to $1,715 million and a slight decrease in net sales to $19,841 million, indicating pressure on profitability despite debt reduction efforts.
• 2025-10-31: Common Stock Shares Outstanding — 985,210,434 shares outstanding as of this date, relevant for per-share calculations and market capitalization.
• 2024-12-31: Year-End Financial Position — Reported total assets of $85,445 million and net long-term debt of $24,978 million, providing a baseline for the current period's changes.

Glossary

Net sales

The total revenue generated from the sale of goods and services after deducting returns, allowances, and discounts. (Key indicator of the company's top-line performance and market demand for its products.)

Diluted EPS

Earnings per share calculated by dividing net income by the weighted-average number of diluted common shares outstanding. (Measures the profitability on a per-share basis, accounting for all potential dilutive securities.)

Long-term debt, net

The total amount of debt that is due more than one year from the balance sheet date, net of any unamortized discount or premium. (Indicates the company's leverage and its ability to meet long-term financial obligations.)

Capital expenditures

Funds used by a company to acquire, upgrade, and maintain physical assets such as property, buildings, and equipment. (Reflects the company's investment in its future operations and growth.)

Net cash provided by operating activities

The amount of cash generated from a company's normal business operations. (A crucial measure of a company's ability to generate cash to fund its operations, investments, and debt payments.)

Accumulated depreciation, depletion and amortization

The total amount of depreciation, depletion, and amortization expense recognized for an asset since its acquisition. (Reduces the gross value of property, plant, and equipment on the balance sheet to reflect its usage and age.)

Noncontrolling interest

The portion of equity in a subsidiary that is not attributable to the parent company. (Represents the ownership stake of outside shareholders in consolidated subsidiaries.)

Year-Over-Year Comparison

Compared to the prior year's nine-month period, Occidental Petroleum reported a significant 35.8% decrease in net income attributable to common stockholders, falling to $1,715 million from $2,674 million, with diluted EPS dropping to $1.68 from $2.77. Net sales saw a slight decline of 0.7% to $19,841 million from $19,965 million. While long-term debt was reduced by $4.132 billion to $20,846 million, net cash provided by operating activities decreased slightly to $7,898 million from $8,083 million, and capital expenditures increased to $5,674 million from $5,237 million.

Key Financial Figures

• $0.20 — ange on which registered Common Stock, $0.20 par value OXY New York Stock Exchange

Filing Documents

• oxy-20250930.htm (10-Q) — 1661KB
• exhibit311-10xq93025.htm (EX-31.1) — 11KB
• exhibit312-10xq93025.htm (EX-31.2) — 10KB
• exhibit321-10xq93025.htm (EX-32.1) — 10KB
• 0001628280-25-051071.txt ( ) — 8958KB
• oxy-20250930.xsd (EX-101.SCH) — 55KB
• oxy-20250930_cal.xml (EX-101.CAL) — 94KB
• oxy-20250930_def.xml (EX-101.DEF) — 262KB
• oxy-20250930_lab.xml (EX-101.LAB) — 687KB
• oxy-20250930_pre.xml (EX-101.PRE) — 455KB
• oxy-20250930_htm.xml (XML) — 1627KB

- Financial Information

Part I - Financial Information

Financial Statements (unaudited)

Item 1. Financial Statements (unaudited) Consolidated Condensed Balance Sheets — September 30, 2025 and December 31, 2024 2 Consolidated Condensed Statements of Operations — Three and nine months ended September 30, 2025 and 2024 4 Consolidated Condensed Statements of Comprehensive Income — Three and nine months ended September 30, 2025 and 2024 5 Consolidated Condensed Statements of Equity — Three and nine months ended September 30, 2025 and 2024 6 Consolidated Condensed Statements of Cash Flows — Nine months ended September 30, 2025 and 2024 8 Notes to Consolidated Condensed Financial Statements Note 1—General 9 Note 2 —Revenue 10 Note 3—Inventor ies 12 Note 4—Long-Term Deb t 13 Note 5—Acquisitions and Divestitures 14 Note 6—Derivatives 15 Note 7—Income Taxes 17 Note 8—Environmental Liabilities and Expenditures 18 Note 9—Lawsuits, Claims, Commitments and Contingencies 20 Note 10—Earnings Per Share and Equity 21 Note 11—Segments 22

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

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 26 Cautionary Statement Regarding Forward-Looking Statements 26 Current Business Outlook 27 Consolidated Results of Operations and Items Affecting Comparability 28 Segment Results of Operations 30 Income Taxes 33 Liquidity and Capital Resources 33 Environmental Liabilities and Expenditures 34 Lawsuits, Claims, Commitments and Contingencies 35

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 35

Controls and Procedures

Item 4. Controls and Procedures 35

- Other Information

Part II - Other Information

Legal Proceedings

Item 1. Legal Proceedings 35

Risk Factors

Item 1A. Risk Factors 35

Other Information

Item 5. Other Information 36

Exhibits

Item 6. Exhibits 37 DEFINED TERMS AND ABBREVIATIONS USED WITHIN THIS DOCUMENT $/Bbl price per barrel Anadarko Anadarko Petroleum Corporation and its consolidated subsidiaries AOC Administrative Order on Consent Bcf billions of cubic feet Berkshire Hathaway Berkshire Hathaway Inc. BlackRock BlackRock Inc. Boe barrels of oil equivalent CERCLA Comprehensive Environmental Response, Compensation, and Liability Act CO 2 carbon dioxide CODM chief operating decision maker CrownRock CrownRock, L.P. CrownRock Acquisition acquisition of all of the outstanding partnership interests of CrownRock by Occidental DASS Diamond Alkali Superfund Site EPA U.S. Environmental Protection Agency EPS earnings per share HLBV Hypothetical Liquidation at Book Value IRA Inflation Reduction Act LIFO last-in, first-out Mbbl thousands of barrels Mboe thousands of barrels equivalent Mboe/d thousands of barrels equivalent per day Mcf thousands of cubic feet MMbbl millions of barrels MMcf millions of cubic feet NCI non-controlling interest NGL natural gas liquids NPL National Priorities List OBBB One Big Beautiful Bill Act Occidental, we, our and the Company Occidental Petroleum Corporation and/or one or more entities in which it owns a controlling interest (subsidiaries) OECD Organization for Economic Cooperation and Development OPEC Organization of the Petroleum Exporting Countries OU Operable Unit OxyChem Occidental Chemical Corporation and its subsidiaries PVC polyvinyl chloride RCF revolving credit facility ROD Record of Decision SEC U.S. Securities and Exchange Commission VIE variable interest entity Waha natural gas trading hub in the Permian Basin WES Western Midstream Partners, LP WES Operating Western Midstream Operating, LP WTI West Texas Intermediate Zero Coupons Zero Coupon senior notes due 2036 2024 Form 10-K Occidental's Annual Report on Form 10-K for the year ended December 31, 2024 1

FINANCIAL INFORMATION

PART I FINANCIAL INFORMATION

Financial Statements (unaudited)

Item 1. Financial Statements (unaudited) Consolidated Condensed Balance Sheets Occidental Petroleum Corporation and Subsidiaries millions September 30, 2025 December 31, 2024 ASSETS CURRENT ASSETS Cash and cash equivalents $ 2,159 $ 2,132 Trade receivables, net of reserves of $ 24 in 2025 and $ 24 in 2024 3,169 3,526 Joint interest receivables 667 720 Inventories 2,117 2,095 Other current assets 700 597 Total current assets 8,812 9,070 INVESTMENTS IN UNCONSOLIDATED ENTITIES 2,989 3,159 PROPERTY, PLANT AND EQUIPMENT Oil and gas 125,378 121,874 Chemical 9,487 8,725 Midstream and marketing 9,836 9,322 Corporate 1,069 1,033 Property, plant and equipment, gross 145,770 140,954 Accumulated depreciation, depletion and amortization ( 78,333 ) ( 71,576 ) Total property, plant and equipment, net 67,437 69,378 OPERATING LEASE ASSETS 1,170 937 OTHER LONG-TERM ASSETS 3,064 2,901 TOTAL ASSETS $ 83,472 $ 85,445 The accompanying notes are an integral part of these Consolidated Condensed Financial Statements. 2 Consolidated Condensed Balance Sheets Occidental Petroleum Corporation and Subsidiaries millions, except share and per-share amounts September 30, 2025 December 31, 2024 LIABILITIES AND EQUITY CURRENT LIABILITIES Current maturities of long-term debt $ 1,616 $ 1,138 Current operating lease liabilities 414 374 Accounts payable 3,532 3,753 Accrued liabilities 3,859 4,256 Total current liabilities 9,421 9,521 LONG-TERM DEBT, NET 20,846 24,978 DEFERRED CREDITS AND OTHER LIABILITIES Deferred income taxes, net 5,402 5,394 Asset retirement obligations 3,856 4,042 Other liabilities 7,181 7,030 Total deferred credits and other liabilities 16,439 16,466 EQUITY Preferred stock, at $ 1.00 per share par value, issued shares: 2025 — 84,897 and 2024 — 84,897 8,287 8,287 Common stock, at $ 0.20 per share par value, authorized shares: 1.5 billion, issued shares: 2025 — 1,213,486,213 and 2024 — 1,166,769,167 243 233 Treasury stock: 2

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