Diamondback Energy, Inc.

What they do

Diamondback develops oil and natural gas properties, primarily in the Midland Basin, with additional activity in the Barnett. In Q2 2026 the company drilled 97 gross wells and completed 168 gross wells, averaging 1,018 MBOE/d of total production. It sells crude oil, natural gas and natural gas liquids at benchmarks including Argus WTI Midland, Argus WTI Houston, Brent and Henry Hub.

Revenue drivers

• Crude oil — The core revenue line: Q2 2026 oil production averaged 525 MBO/d at a realized price of $96.82 per Bbl, or $94.33 per Bbl hedged.
• Natural gas — Realized natural gas prices were negative $2.15 per Mcf in Q2 2026, versus $0.18 in Q1 2026 and $0.88 in Q2 2025.
• Natural gas liquids — NGLs realized $18.56 per Bbl in Q2 2026, up from $16.68 in Q1 2026 and $18.13 in Q2 2025.
• Combined realizations — Total realizations averaged $51.68 per BOE in Q2 2026, or $52.90 per BOE hedged, versus $43.40 and $45.21 in Q1 2026.

Recent performance

Q2 2026 revenue was $5.56 billion, up from $4.24 billion in Q1 2026 and $3.38 billion in Q4 2025. Net cash provided by operating activities was $3.6 billion, operating cash flow before working capital changes was $3.3 billion, and free cash flow was $2.3 billion. Cash capital expenditures were $996 million. The company repurchased 756,385 shares for about $141 million and declared a base dividend of $1.10 per share. Total debt fell $1.3 billion quarter over quarter to $12.8 billion and net debt fell $1.6 billion to $12.3 billion.

Strategy

Diamondback is raising full-year 2026 oil production guidance to 522+ MBO/d from 520+ and total BOE guidance to 1,000+ MBOE/d from 972+, while holding cash capital expenditures at $3.9 billion. In July 2026 the board doubled the share repurchase authorization to $16.0 billion, leaving roughly $9.9 billion available. The company repurchased another 547,716 shares for about $100 million in Q3 2026 to date. It continues to fund a base cash dividend, which was declared at $1.10 per share for the second quarter.

Risks

• Commodity price volatility — Realized natural gas prices were negative $2.15 per Mcf in Q2 2026, and the 10-K states that price volatility may adversely affect revenue, cash flows, profitability, growth, production and reserve value.
• Trade policy and tariffs — The 10-K states that changes in U.S. trade policy and tariffs may have a material adverse effect, and that such changes can be announced with little or no advance notice.
• Low carbon transition — The 10-K cites risks that new climate-related regulations, policies and initiatives could raise compliance and operating costs and reduce demand for hydrocarbons.
• Hedging and counterparty risk — The 10-K states commodity price derivatives could result in financial losses, may fail to protect against price declines, prevent full benefit from price increases and expose the company to counterparty credit risk.

Outlook

Management guides Q3 2026 oil production of 517-527 MBO/d and total production of 995-1,015 MBOE/d, with Q3 cash capital expenditures of $950 million to $1.05 billion. Full-year 2026 oil guidance is 522+ MBO/d and total BOE guidance is 1,000+ MBOE/d, with full-year cash capital expenditures unchanged at $3.9 billion. The company says it has about $9.9 billion remaining under its repurchase authorization.