Chevron's Q3 Net Income Plunges 34% Amid Revenue Dip, Hess Acquisition

Ticker: CVX · Form: 10-Q · Filed: 2025-11-06T00:00:00.000Z

Sentiment: bearish

Topics: Oil & Gas, Earnings Decline, Debt Increase, Acquisition, Energy Sector, Financial Performance, Shareholder Value

Related Tickers: CVX, HES, XOM, BP

TL;DR

**Chevron's Q3 numbers are a red flag, with net income down 34% and debt soaring from the Hess deal – time to be cautious on CVX.**

AI Summary

Chevron Corporation reported a significant decline in net income attributable to Chevron Corporation for the nine months ended September 30, 2025, falling to $9.529 billion from $14.422 billion in the prior year, a decrease of 34%. This was primarily driven by a reduction in total revenues and other income, which decreased to $142.158 billion from $150.566 billion, a 5.6% drop. Sales and other operating revenues also saw a decline, from $145.080 billion in 2024 to $138.645 billion in 2025. Income from equity affiliates decreased substantially from $3.908 billion to $2.337 billion. Despite these revenue challenges, the company's total costs and other deductions decreased slightly to $127.014 billion from $129.119 billion. A notable strategic move was the acquisition of Hess Corporation common stock, with a cash outflow of $2.225 billion during the nine-month period. The company also saw a significant increase in long-term debt, rising to $37.953 billion at September 30, 2025, from $20.135 billion at December 31, 2024, likely related to financing the Hess acquisition and other capital expenditures. Cash provided by operating activities remained relatively stable at $23.150 billion compared to $22.797 billion in the prior year.

Why It Matters

Chevron's substantial 34% drop in net income and declining revenues signal potential headwinds for investors, impacting dividend sustainability and future share price appreciation. The significant increase in long-term debt to $37.953 billion, largely driven by the Hess Corporation acquisition, indicates a strategic shift towards expansion but also introduces higher financial leverage and interest expense, which rose to $856 million for the nine months. This could affect Chevron's competitive position against peers like ExxonMobil, who may have more conservative debt profiles. Employees and customers might see implications in future project investments and product pricing, respectively, as the company navigates a more challenging financial landscape.

Risk Assessment

Risk Level: high — The risk level is high due to a 34% decrease in net income attributable to Chevron Corporation, from $14.422 billion in the nine months ended September 30, 2024, to $9.529 billion in the same period of 2025. Additionally, long-term debt nearly doubled, increasing from $20.135 billion at December 31, 2024, to $37.953 billion at September 30, 2025, indicating increased financial leverage and potential vulnerability to interest rate fluctuations.

Analyst Insight

Investors should closely monitor Chevron's integration of Hess Corporation and its ability to generate sufficient cash flow to service the increased debt load. Consider re-evaluating your position given the significant decline in net income and the substantial increase in long-term debt, which could pressure future earnings and dividend growth.

Financial Highlights

revenue
$142.158B
total Debt
$37.953B
net Income
$9.529B
eps
$5.27
revenue Growth
-5.6%

Revenue Breakdown

SegmentRevenueGrowth
Sales and other operating revenues$138,645M-4.4%
Income from equity affiliates$2,337M-40.2%
Other income (loss)$1,176M-25.2%

Key Numbers

Key Players & Entities

FAQ

What was Chevron's net income for the nine months ended September 30, 2025?

Chevron's net income attributable to Chevron Corporation for the nine months ended September 30, 2025, was $9.529 billion, a significant decrease from $14.422 billion in the same period of 2024.

How did Chevron's revenues change in the latest 10-Q filing?

Chevron's total revenues and other income decreased to $142.158 billion for the nine months ended September 30, 2025, down from $150.566 billion in the prior year, representing a 5.6% decline.

What impact did the Hess Corporation acquisition have on Chevron's cash flow?

The acquisition of Hess Corporation common stock resulted in a cash outflow of $2.225 billion for Chevron during the nine months ended September 30, 2025, as reported in the investing activities section of the cash flow statement.

How much long-term debt did Chevron have as of September 30, 2025?

As of September 30, 2025, Chevron's long-term debt stood at $37.953 billion, a substantial increase from $20.135 billion at December 31, 2024.

What were Chevron's operating expenses for the nine months ended September 30, 2025?

Chevron's operating expenses for the nine months ended September 30, 2025, were $20.616 billion, an increase from $19.842 billion in the same period of 2024.

Did Chevron's cash provided by operating activities change significantly?

No, Chevron's net cash provided by operating activities remained relatively stable, at $23.150 billion for the nine months ended September 30, 2025, compared to $22.797 billion in the same period of 2024.

What was Chevron's diluted earnings per share for the nine months ended September 30, 2025?

Chevron's diluted earnings per share attributable to Chevron Corporation for the nine months ended September 30, 2025, was $5.27, a decrease from $7.88 in the same period of 2024.

How many shares of common stock were outstanding for Chevron on September 30, 2025?

There were 2,013,521,597 shares of Chevron's common stock outstanding on September 30, 2025, an increase from 1,797,091,325 shares at September 30, 2024.

What were the key factors contributing to the decline in Chevron's net income?

The decline in Chevron's net income was primarily driven by lower sales and other operating revenues, which fell from $145.080 billion to $138.645 billion, and a decrease in income from equity affiliates from $3.908 billion to $2.337 billion for the nine months ended September 30, 2025.

What is Chevron's current risk level based on this 10-Q filing?

Based on the 10-Q filing, Chevron's risk level is high due to a 34% decrease in net income and a near doubling of long-term debt from $20.135 billion to $37.953 billion, indicating increased financial leverage and potential earnings pressure.

Risk Factors

Industry Context

The oil and gas industry is characterized by significant capital intensity, cyclical commodity prices, and increasing regulatory scrutiny. Major players like Chevron face challenges from volatile energy markets, the global transition to cleaner energy sources, and geopolitical risks impacting supply and demand.

Regulatory Implications

Chevron operates in a highly regulated environment. Changes in environmental regulations, tax policies, and international trade agreements can significantly impact its operations and profitability. Compliance with evolving climate-related disclosures and energy transition mandates presents ongoing challenges.

What Investors Should Do

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Key Dates

Glossary

Income (loss) from equity affiliates
Chevron's share of the net income or loss earned by companies in which it has a significant influence but not control. (A substantial decrease in this line item contributed to the overall decline in Chevron's total revenues and income.)
Depreciation, depletion and amortization
Non-cash expenses that represent the reduction in the value of tangible and intangible assets over time. (This expense increased significantly to $14.248 billion for the nine months ended September 30, 2025, impacting net income.)
Interest and debt expense
The cost incurred by the company for borrowing money, including interest on loans and bonds. (This expense more than doubled to $856 million for the nine months ended September 30, 2025, reflecting the increased debt levels.)
Accumulated Other Comprehensive Income (Loss)
A component of equity that includes unrealized gains and losses on certain investments and foreign currency translations that have not yet been realized. (The company's AOCL balance changed, with a net increase in comprehensive income for the nine months ended September 30, 2025.)
Operating working capital
The difference between a company's current assets (excluding cash and cash equivalents) and current liabilities (excluding debt). (A net decrease in operating working capital of $2.685 billion for the nine months ended September 30, 2025, impacted cash flow from operations.)
Noncontrolling interests
The portion of equity in a subsidiary that is not attributable to the parent company. (Net income attributable to Chevron Corporation is reduced by the net income attributable to noncontrolling interests.)

Year-Over-Year Comparison

Compared to the nine months ended September 30, 2024, Chevron Corporation experienced a significant downturn in financial performance for the same period in 2025. Total revenues and other income decreased by 5.6% to $142.158 billion, and net income attributable to Chevron Corporation plummeted by 34% to $9.529 billion. This decline was exacerbated by a substantial drop in income from equity affiliates, which fell by 40.2%. Concurrently, the company's long-term debt more than doubled, indicating increased financial leverage, while interest and debt expense rose by 116.7%.

Filing Stats: 4,833 words · 19 min read · ~16 pages · Grade level 20 · Accepted 2025-11-06 11:29:11

Filing Documents

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 8 Item 2.

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

Management's Discussion and Analysis of Financial Condition and Results of Operations 28 Item 3.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 45 Item 4.

Controls and Procedures

Controls and Procedures 46 PART II OTHER INFORMATION Item 1.

Legal Proceedings

Legal Proceedings 46 Item 1A.

Risk Factors

Risk Factors 46 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 47 Item 5 . Other Information 47 Item 6. Exhibits 48 Signature 49 1 Table of Contents CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION FOR THE PURPOSE OF "SAFE HARBOR" PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 This quarterly report on Form 10-Q of Chevron Corporation contains forward-looking statements relating to Chevron's operations, assets, and strategy that are based on management's current expectations, estimates and projections about the petroleum, chemicals and other energy-related industries. Words or phrases such as "anticipates," "expects," "intends," "plans," "targets," "advances," "commits," "drives," "aims," "forecasts," "projects," "believes," "approaches," "seeks," "schedules," "estimates," "positions," "pursues," "progress," "design," "enable," "may," "can," "could," "should," "will," "budgets," "outlook," "trends," "guidance," "focus," "on track," "trajectory," "goals," "objectives," "strategies," "opportunities," "poised," "potential," "ambitions," "future," "aspires" and similar expressions, and variations or negatives of these words, are intended to identify such forward-looking statements, but not all forward-looking statements include such words. These statements are not guarantees of future performance and are subject to numerous risks, uncertainties and other factors, many of which are beyond the company's control and are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. The reader should not place undue reliance on these forward-looking statements, which speak only as of the date of this report. Unless legally required, Chevron undertakes no obligation to update publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Among the important fac

Consolidated Financial Statements

Item 1. Consolidated Financial Statements CHEVRON CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENT OF INCOME (Unaudited) Three Months Ended September 30 Nine Months Ended September 30 2025 2024 2025 2024 (Millions of dollars, except per-share amounts) Revenues and Other Income Sales and other operating revenues $ 48,169 $ 48,926 $ 138,645 $ 145,080 Income (loss) from equity affiliates 981 1,261 2,337 3,908 Other income (loss) 576 482 1,176 1,578 Total Revenues and Other Income 49,726 50,669 142,158 150,566 Costs and Other Deductions Purchased crude oil and products 27,398 30,450 82,866 89,058 Operating expenses 7,534 6,695 20,616 19,842 Selling, general and administrative expenses 1,524 1,191 3,634 3,249 Exploration expenses 288 154 727 546 Depreciation, depletion and amortization 5,781 4,214 14,248 12,309 Taxes other than on income 1,347 1,263 3,903 3,575 Interest and debt expense 370 164 856 395 Other components of net periodic benefit costs 70 49 164 145 Total Costs and Other Deductions 44,312 44,180 127,014 129,119 Income (Loss) Before Income Tax Expense 5,414 6,489 15,144 21,447 Income Tax Expense (Benefit) 1,801 1,993 5,504 6,957 Net Income (Loss) 3,613 4,496 9,640 14,490 Less: Net income (loss) attributable to noncontrolling interests 74 9 111 68 Net Income (Loss) Attributable to Chevron Corporation $ 3,539 $ 4,487 $ 9,529 $ 14,422 Per Share of Common Stock Net Income (Loss) Attributable to Chevron Corporation - Basic $ 1.83 $ 2.49 $ 5.29 $ 7.91 - Diluted $ 1.82 $ 2.48 $ 5.27 $ 7.88 Weighted Average Number of Shares Outstanding (000s) - Basic 1,938,922 1,800,336 1,801,623 1,822,770 - Diluted 1,946,035 1,807,030 1,808,004 1,829,776 See accompanying notes to consolidated financial statements. 3 Table of Contents CHEVRON CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (Unaudited) Three Months Ended September 30 Nine Months Ended September 30 2025 2024 2025 2024 (Millions of dollars)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Note 1. General Basis of Presentation The accompanying consolidated financial statements of Chevron Corporation and its subsidiaries (together, Chevron or the company) have not been audited by an independent registered public accounting firm. In the opinion of the company's management, the interim data includes all adjustments necessary for a fair statement of the results for the interim periods. These adjustments were of a normal recurring nature. The results for the three- and nine-month periods ended September 30, 2025, are not necessarily indicative of future financial results. The term "earnings" is defined as net income attributable to Chevron. Certain notes and other information have been condensed or omitted from the interim financial statements presented in this Quarterly Report on Form 10-Q. Therefore, these financial statements should be read in conjunction with the company's 2024 Annual Report on Form 10-K. Note 2. Changes in Accumulated Other Comprehensive Losses The change in Accumulated Other Comprehensive Losses (AOCL) presented on the Consolidated Balance Sheet and the impact of significant amounts reclassified from AOCL on information presented in the Consolidated Statement of Income for the nine months ended September 30, 2025 and 2024, are reflected in the table below. Changes in Accumulated Other Comprehensive Income (Loss) by Component (1) Currency Translation Adjustment Unrealized Holding Gains (Losses) on Securities Derivatives Defined Benefit Plans Total (Millions of dollars) Balance at December 31, 2023 $ ( 192 ) $ ( 11 ) $ 5 $ ( 2,762 ) $ ( 2,960 ) Components of Other Comprehensive Income (Loss): Before Reclassifications ( 9 ) ( 5 ) ( 36 ) 13 ( 37 ) Reclassifications (2) (3) — — 43 129 172 Net Other Comprehensive Income (Loss) ( 9 ) ( 5 ) 7 142 135 Balance at September 30, 2024 $ ( 201 ) $ ( 16 ) $ 12 $ ( 2,620 ) $ ( 2,825 ) Balance at December 31, 2024 $ ( 259 ) $ ( 19 ) $ ( 1

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) Note 3. Information Relating to the Consolidated Statement of Cash Flows Nine Months Ended September 30 2025 2024 (Millions of dollars) Distributions more (less) than income from equity affiliates included the following: Distributions from equity affiliates $ 4,139 $ 3,423 (Income) loss from equity affiliates ( 2,337 ) ( 3,908 ) Distributions more (less) than income from equity affiliates $ 1,802 $ ( 485 ) Net decrease (increase) in operating working capital was composed of the following: Decrease (increase) in accounts and notes receivable $ 4,018 $ 286 Decrease (increase) in inventories ( 767 ) ( 1,113 ) Decrease (increase) in prepaid expenses and other current assets ( 375 ) 96 Increase (decrease) in accounts payable and accrued liabilities ( 4,193 ) ( 121 ) Increase (decrease) in income and other taxes payable ( 1,368 ) ( 1,320 ) Net decrease (increase) in operating working capital $ ( 2,685 ) $ ( 2,172 ) Net cash provided by operating activities included the following cash payments: Interest on debt (net of capitalized interest) $ 573 $ 326 Income taxes 5,524 6,586 Proceeds and deposits related to asset sales and returns of investment consisted of the following gross amounts: Proceeds and deposits related to asset sales $ 1,380 $ 497 Returns of investment from equity affiliates 93 123 Proceeds and deposits related to asset sales and returns of investment $ 1,473 $ 620 Net maturities of (investments in) time deposits consisted of the following gross amounts: Investments in time deposits $ ( 12 ) $ ( 4 ) Maturities of time deposits 14 — Net maturities of (investments in) time deposits $ 2 $ ( 4 ) Net sales (purchases) of marketable securities consisted of the following gross amounts: Marketable securities purchased $ — $ — Marketable securities sold — 45 Net sales (purchases) of marketable securities $ — $ 45 Net repayment (borrowing) of loans by equity affiliates consisted

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (Continued) The Consolidated Statement of Cash Flows excludes changes to the Consolidated Balance Sheet that did not affect cash. The "Other" line in the Operating Activities section includes changes in asset retirement obligations, abandonment and decommissioning obligations associated with previously sold assets, postretirement benefits obligations, and other long-term liabilities. The company paid dividends of $ 1.71 per share of common stock in third quarter 2025. This compares to dividends of $ 1.63 per share paid in the year-ago corresponding period. The components of "Capital expenditures" are presented in the following table: Nine Months Ended September 30 2025 2024 (Millions of dollars) Additions to properties, plant and equipment $ 11,715 $ 11,590 Additions to investments 150 392 Current-year dry hole expenditures 218 $ 128 Capital expenditures $ 12,083 $ 12,110 The table below quantifies the beginning and ending balances of restricted cash and restricted cash equivalents in the Consolidated Balance Sheet: At September 30 At December 31 2025 2024 2024

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