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EXPAND ENERGY Corp

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Business Summary

Expand Energy Corporation operates as the largest independent natural gas producer in the U.S., focusing on the responsible development of natural gas, oil, and natural gas liquids (NGL) to broaden energy access. The company's operations are concentrated in key shale plays across Louisiana and Texas (Haynesville and Bossier Shales), Pennsylvania (Marcellus Shale in Northeast Appalachia), and West Virginia and Ohio (Marcellus and Utica Shales in Southwest Appalachia) . The company's business model is centered on the acquisition, exploration, development, and production of natural gas, oil, and NGL, with an emphasis on improving margins through operational efficiencies, marketing, commercial efforts, and financial discipline, while also enhancing safety and sustainability performance . Revenue is primarily generated from the sale of natural gas, oil, and NGL production, as well as from marketing activities that include purchasing and selling joint interest holders' production .

The company's product and service lines are primarily categorized by geographic operating areas: Haynesville, Northeast Appalachia, and Southwest Appalachia. In 2025, Haynesville contributed $3,477 million in natural gas, oil, and NGL sales, Northeast Appalachia contributed $2,860 million , and Southwest Appalachia contributed $2,139 million . The company also engages in vertical integration by operating drilling rigs and providing certain oilfield products and services, primarily for its own exploration and production operations . As of December 31, 2025, Expand Energy held a working interest in approximately 6,600 gross natural gas and oil wells, with substantially all classified as productive natural gas wells . The company completed 272 gross (202 net) wells as operator and participated in 39 gross (1 net) wells completed by other operators during 2025 .

For the fiscal year ended December 31, 2025, Expand Energy reported total revenues and other of $12,124 million . Gross profit, calculated as total revenues and other less production, gathering, processing and transportation, and severance and ad valorem taxes, was $8,910 million . Operating income for the period was $2,471 million . Net income stood at $1,819 million , resulting in basic earnings per common share of $7.67 and diluted earnings per common share of $7.57 . Cash provided by operating activities was $4,575 million . As of December 31, 2025, the company held cash and cash equivalents of $616 million and total long-term debt, net, of $5,009 million .

Comparing 2025 to 2024, natural gas, oil, and NGL sales increased by $5,507 million , driven by a $3,476 million increase from higher volumes, primarily due to the Southwestern Merger, and a $2,031 million increase from higher average natural gas prices. Production expenses rose by $319 million , and gathering, processing, and transportation expenses increased by $1,341 million , both primarily due to the Southwestern Merger and increased volumes and rates. Severance and ad valorem taxes increased by $96 million , largely due to the Southwestern Merger, partially offset by a decrease in the Haynesville statutory severance tax rate. Marketing revenues and expenses also increased in 2025 compared to 2024, reflecting increased marketing activities driven by higher production volumes from the Southwestern Merger and an increase in natural gas prices . Depreciation, depletion, and amortization increased by $1,251 million to $2,980 million in 2025, primarily due to the Southwestern Merger, while the per Mcfe rate decreased due to lower depletion rates on acquired wells .

A significant operational development was the completion of the Southwestern Merger on October 1, 2024, which led to the issuance of approximately 95.7 million shares of common stock to Southwestern's shareholders, valued at approximately $7.9 billion . Following the merger, Expand Energy reduced total debt by approximately $1.2 billion and upsized its 2025 Credit Facility capacity to $3.5 billion . In March 2025, the company was added to the S&P 500 index . The 2025 Credit Facility was amended on September 30, 2025, extending its maturity to September 2030 and increasing aggregate commitments from $2.5 billion to $3.5 billion . The company also issued $750 million of 5.70% Senior Notes due 2035 in December 2024 and repaid various senior notes totaling $389 million in January 2025 and $47 million in March 2025, along with open market repurchases of approximately $103 million , $60 million , and $62 million of other senior notes due 2029.

Business Outlook

For the fiscal year ending December 31, 2026, Expand Energy anticipates completing and turning in line 205 to 235 gross wells , utilizing approximately 11 to 12 rigs . The company plans to invest between approximately $2.75 billion and $2.95 billion in capital expenditures for 2026. This capital program is expected to be funded through cash on hand, projected cash flow from operations, and borrowings under the 2025 Credit Facility .

A major growth area for Expand Energy is its participation in the global LNG value chain. The company's business strategy explicitly includes this participation, which is partly dependent on the expanding U.S. LNG export market . The company has entered into a joint venture to build the New Generation Gas Gathering pipeline (NG3 pipeline) to gather and treat natural gas from the Haynesville Shale for delivery to Gulf Coast markets, including LNG export . The NG3 pipeline, in which Expand Energy holds a 35% interest , was placed in service and began gathering operations on October 1, 2025 . The company has a gathering agreement requiring approximately 900 MMcf per day of natural gas to be gathered and processed by the NG3 pipeline over the next 12 years . This initiative aims to deliver affordable, lower-carbon energy to meet growing domestic and international demand .

The company's operational outlook includes a continued focus on improving margins through operating efficiencies, marketing and commercial efforts, and financial discipline, alongside enhancing safety and sustainability performance . Expand Energy plans to allocate human resources and capital expenditures to projects offering the highest cash return on capital invested and to deploy leading drilling and completion technology . The company also intends to continue investing in projects designed to reduce the environmental impact of its production activities . In terms of cost structure, the company's oilfield service business, assumed as part of the Southwestern Merger, allows for some vertical integration of exploration and production operations, which may help control costs and secure inputs .

Regarding capital allocation, the company's forecasted 2026 capital expenditures are $2.75 billion to $2.95 billion . In 2025, Expand Energy prioritized paying a base dividend of $2.30 per share and achieving $1.0 billion in annual net debt reduction, with 75% of remaining free cash flow distributed through share repurchases and additional dividend payments, as market conditions warranted . For 2026, the company will continue to prioritize debt reduction while effectively returning cash to shareholders . The Board of Directors declared a base quarterly dividend of $0.575 per share payable on March 26, 2026 . The company also has a share repurchase program authorized for up to $1.0 billion in aggregate, under which $100 million was repurchased in 2025, leaving $900 million available as of December 31, 2025 .

Management has explicitly flagged several structural headwinds and execution risks. Geopolitical risk and policy uncertainty are expected to continue driving volatility in natural gas, oil, and NGL prices, while macroeconomic headwinds in key consuming countries could impact global growth prospects and energy commodity supply and demand . Domestically, the natural gas market balance has tightened through 2027 due to robust demand from seasonal weather, LNG, power generation, and industrials, leading to upward pressure and volatility on near-term pricing . The company's future estimated cash flow is partially protected by current hedge positions covering over 60% of projected gas volumes through the end of 2026 . The U.S. LNG export market, a highly regulated and capital-intensive industry, presents inherent commercial and regulatory risks, and a deterioration in this industry could reduce demand for natural gas and adversely impact the company . Furthermore, the company may face additional commercial risks through direct marketing arrangements with LNG export facilities and end users, including commodity risks associated with differential pricing in global LNG markets .

Risk Factors

Expand Energy faces material risks including the wide fluctuation of natural gas, oil, and NGL prices, which directly impacts revenues, profitability, liquidity, and capital expenditure capacity . Reduced demand for natural gas and oil due to conservation measures and technological advances, as well as negative public perception of the industry, could adversely affect operations . The industry is highly competitive, with some competitors possessing greater financial resources, and there is intense competition for talent and access to equipment . Risks associated with potential acquisitions or dispositions, such as integration challenges, unforeseen liabilities, and inaccurate assumptions about reserves or costs, could negatively impact financial condition . The company may be required to record write-downs of natural gas and oil property carrying values if commodity prices fall or drilling efforts are unsuccessful . Significant capital expenditures are required to replace reserves and conduct business, and an inability to fund these could lead to curtailed activity and declining reserves . Estimates of proved reserves and future net revenues are inherently uncertain and subject to revisions based on actual production, drilling results, and commodity prices, with approximately 28% of proved reserves being undeveloped as of December 31, 2025 . Commodity price risk management activities may limit benefits from price increases and expose the company to counterparty non-performance risk . Natural gas and oil operations involve substantial costs and risks, including unexpected drilling conditions, equipment failures, and environmental hazards, which may not be fully covered by insurance . The ability to produce economically could be impaired by difficulties in acquiring adequate water supplies or disposing of used water . Pipeline and gathering system capacity constraints and interruptions, including those affecting the NG3 pipeline, could adversely affect cash flow . The company's business strategy includes participation in the global LNG value chain, which is dependent on the highly regulated and capital-intensive U.S. LNG export market, exposing it to commercial and regulatory risks, including potential reductions in demand for natural gas . The departure of key management personnel and challenges in attracting and retaining talent could adversely affect operations . Cyber-attacks targeting systems and infrastructure, including those of third-party providers, pose a significant and evolving risk, potentially leading to disruptions, financial liabilities, and reputational harm . Compliance with rapidly evolving data privacy and security laws, such as CCPA and CPRA, could increase costs and lead to penalties or reputational damage . Catastrophes, natural disasters, severe weather, and human causes beyond control, including military conflicts and terrorist activities, could disrupt operations and impact financial results . Deterioration in general economic, political, business, or industry conditions, including inflationary pressures and supply chain shortages, could materially adversely affect results . The company may be unable to dispose of assets on attractive terms and may retain liabilities from such transactions . Significant indebtedness of approximately $5.0 billion as of December 31, 2025 , limits liquidity and financial flexibility, and restrictive covenants in debt instruments may constrain business activities . The ability to declare and pay dividends and repurchase common stock is subject to Board discretion and financial limitations . The market price of common stock may be volatile due to various factors, including commodity prices and economic conditions . Extensive governmental regulation, including environmental, health, and safety laws, pipeline safety rules, and hydraulic fracturing regulations, can change and increase compliance costs, potentially impacting operations . Increasing attention to sustainability matters, including ESG ratings and climate change initiatives, may lead to increased costs, changes in demand, and reputational harm . Changes in tax law, such as the 15% corporate alternative minimum tax (CAMT) and annual limitations on tax attribute utilization triggered by the Southwestern Merger, could increase the cost of doing business and income tax liabilities . Judicial decisions regarding property rights and contractual provisions could increase liabilities or restrict operations .

Management Priorities

Management's overall tone emphasizes creating resilient shareholder value through responsible development of significant resource plays and being a leading natural gas provider to growing markets. They are focused on improving margins through operating efficiencies, marketing and commercial efforts, and financial discipline, while also enhancing safety and sustainability performance. The company plans to allocate human resources and capital expenditures to projects offering the highest cash return on capital invested, deploy leading drilling and completion technology, and leverage acquisition and divestiture opportunities to strengthen the portfolio. Management also intends to continue investing in projects designed to reduce the environmental impact of production activities and aims for net zero (Scope 1 and 2) greenhouse gas emissions by 2035 , and to maintain 100% responsibly sourced gas (RSG) certification across its portfolio . For the year ending December 31, 2026, the company expects to complete and turn in line 205 to 235 gross wells utilizing approximately 11 to 12 rigs , with planned capital expenditures between approximately $2.75 billion and $2.95 billion . In 2026, the company will continue to prioritize debt reduction while effectively returning cash to shareholders .

View Source Annual Report on SEC.gov ↗

References

  1. [1] Item 1, Business — Our Business
  2. [2] Item 1, Business — Business Strategy
  3. [3] Item 1, Business — Marketing; Item 1, Business — Major Customers; Item 1, Business — Oilfield Services Vertical Integration; Item 8, Note 8 — Revenue
  4. [4] Item 7, MD&A — Natural Gas, Oil and NGL Sales
  5. [5] Item 7, MD&A — Natural Gas, Oil and NGL Sales
  6. [6] Item 7, MD&A — Natural Gas, Oil and NGL Sales
  7. [7] Item 1, Business — Oilfield Services Vertical Integration
  8. [8] Item 1, Business — Our Business
  9. [9] Item 1, Business — Well Data
  10. [10] Item 8, Consolidated Statements of Operations
  11. [11] Item 8, Consolidated Statements of Operations
  12. [12] Item 8, Consolidated Statements of Operations
  13. [13] Item 8, Consolidated Statements of Operations
  14. [14] Item 8, Consolidated Statements of Operations
  15. [15] Item 8, Consolidated Statements of Operations
  16. [16] Item 8, Consolidated Statements of Cash Flows
  17. [17] Item 8, Consolidated Balance Sheets
  18. [18] Item 8, Consolidated Balance Sheets
  19. [19] Item 7, MD&A — Natural Gas, Oil and NGL Sales
  20. [20] Item 7, MD&A — Natural Gas, Oil and NGL Sales
  21. [21] Item 7, MD&A — Natural Gas, Oil and NGL Sales
  22. [22] Item 7, MD&A — Production Expenses
  23. [23] Item 7, MD&A — Gathering, Processing and Transportation Expenses ("GP&T")
  24. [24] Item 7, MD&A — Severance and Ad Valorem Taxes
  25. [25] Item 7, MD&A — Marketing Revenues and Expenses
  26. [26] Item 7, MD&A — Depreciation, Depletion and Amortization
  27. [27] Item 7, MD&A — Depreciation, Depletion and Amortization
  28. [28] Item 7, MD&A — Depreciation, Depletion and Amortization
  29. [29] Item 7, MD&A — Recent and Significant Developments — Southwestern Merger
  30. [30] Item 7, MD&A — Recent and Significant Developments — Southwestern Merger
  31. [31] Item 1, Business — Our Business
  32. [32] Item 1, Business — Our Business
  33. [33] Item 7, MD&A — Recent and Significant Developments — Addition to the S&P 500 Index
  34. [34] Item 7, MD&A — Recent and Significant Developments — Credit Facility
  35. [35] Item 7, MD&A — Recent and Significant Developments — Credit Facility
  36. [36] Item 7, MD&A — Recent and Significant Developments — Issuance of Senior Notes and Senior Notes Repayment
  37. [37] Item 7, MD&A — Recent and Significant Developments — Issuance of Senior Notes and Senior Notes Repayment
  38. [38] Item 7, MD&A — Recent and Significant Developments — Issuance of Senior Notes and Senior Notes Repayment
  39. [39] Item 7, MD&A — Recent and Significant Developments — Issuance of Senior Notes and Senior Notes Repayment
  40. [40] Item 7, MD&A — Recent and Significant Developments — Issuance of Senior Notes and Senior Notes Repayment
  41. [41] Item 7, MD&A — Recent and Significant Developments — Issuance of Senior Notes and Senior Notes Repayment
  42. [42] Item 7, MD&A — Capital Expenditures
  43. [43] Item 7, MD&A — Capital Expenditures
  44. [44] Item 7, MD&A — Capital Expenditures
  45. [45] Item 7, MD&A — Capital Expenditures
  46. [46] Item 1A, Risk Factors — Our business strategy includes participating in the global LNG value chain
  47. [47] Item 1, Business — Business Strategy; Item 1A, Risk Factors — Our business strategy includes participating in the global LNG value chain
  48. [48] Item 8, Note 15 — Investments — Momentum Sustainable Ventures LLC.
  49. [49] Item 8, Note 15 — Investments — Momentum Sustainable Ventures LLC.
  50. [50] Item 8, Note 15 — Investments — Momentum Sustainable Ventures LLC.
  51. [51] Item 8, Note 15 — Investments — Momentum Sustainable Ventures LLC.
  52. [52] Item 7, MD&A — Introduction
  53. [53] Item 7, MD&A — Introduction
  54. [54] Item 7, MD&A — Introduction
  55. [55] Item 7, MD&A — Introduction
  56. [56] Item 7, MD&A — Economic and Market Conditions
  57. [57] Item 1A, Risk Factors — Significant capital expenditures are required to replace our reserves and conduct our business.
  58. [58] Item 7, MD&A — Shareholder Returns
  59. [59] Item 7, MD&A — Shareholder Returns
  60. [60] Item 7, MD&A — Shareholder Returns
  61. [61] Item 7, MD&A — Shareholder Returns
  62. [62] Item 7, MD&A — Liquidity and Capital Resources — Dividends
  63. [63] Item 7, MD&A — Liquidity and Capital Resources — Dividends
  64. [64] Item 7, MD&A — Shareholder Returns
  65. [65] Item 7, MD&A — Shareholder Returns
  66. [66] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities — Repurchases of Equity Securities; Unregistered Sales of Equity Securities and Use of Proceeds
  67. [67] Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities — Repurchases of Equity Securities; Unregistered Sales of Equity Securities and Use of Proceeds
  68. [68] Item 7, MD&A — Economic and Market Conditions
  69. [69] Item 7, MD&A — Economic and Market Conditions
  70. [70] Item 7, MD&A — Economic and Market Conditions
  71. [71] Item 7, MD&A — Economic and Market Conditions
  72. [72] Item 1A, Risk Factors — Our business strategy includes participating in the global LNG value chain
  73. [73] Item 1A, Risk Factors — Our business strategy includes participating in the global LNG value chain
  74. [74] Item 1A, Risk Factors — Natural gas, oil and NGL prices fluctuate widely, and lower prices for an extended period of time are likely to have a material adverse effect on our business.
  75. [75] Item 1A, Risk Factors — Conservation measures and technological advances could reduce demand for natural gas and oil.; Item 1A, Risk Factors — Negative public perception regarding us or our industry could have an adverse effect on our operations.
  76. [76] Item 1A, Risk Factors — The gas and oil exploration and production industry is very competitive; some of our competitors have greater financial and other resources than we do, and there is competition to attract and retain talent and competition over access to certain industry equipment.
  77. [77] Item 1A, Risk Factors — Risks related to potential acquisitions or dispositions may adversely affect our business.
  78. [78] Item 1A, Risk Factors — If commodity prices fall or drilling efforts are unsuccessful, we may be required to record write-downs of the carrying value of our natural gas and oil properties.
  79. [79] Item 1A, Risk Factors — Significant capital expenditures are required to replace our reserves and conduct our business.
  80. [80] Item 1A, Risk Factors — The actual quantities of and future net revenues from our proved reserves may be less than our estimates.
  81. [81] Item 1A, Risk Factors — The actual quantities of and future net revenues from our proved reserves may be less than our estimates.
  82. [82] Item 1A, Risk Factors — Our commodity price risk management activities may limit the benefit we would receive from increases in commodity prices, may require us to provide collateral for derivative liabilities and involve risk that our counterparties may be unable to satisfy their obligations to us.
  83. [83] Item 1A, Risk Factors — Natural gas and oil operations are uncertain and involve substantial costs and risks.
  84. [84] Item 1A, Risk Factors — Our ability to produce natural gas, oil and NGL economically and in commercial quantities could be impaired if we are unable to acquire adequate supplies of water for our operations or are unable to dispose of or recycle the water we use economically and in compliance with environmental laws.
  85. [85] Item 1A, Risk Factors — Our operations may be adversely affected by pipeline, trucking and gathering system capacity constraints and may be subject to interruptions that could adversely affect our cash flow.
  86. [86] Item 1A, Risk Factors — Our business strategy includes participating in the global LNG value chain
  87. [87] Item 1A, Risk Factors — The departure of key management personnel and the failure to attract and retain talent could adversely affect our operations.
  88. [88] Item 1A, Risk Factors — Cyber-attacks targeting systems and infrastructure used by the gas and oil industry and related regulations may adversely impact our operations and, if we or our third-party providers are unable to obtain and maintain adequate protection for our key systems and data, our business may be harmed.
  89. [89] Item 1A, Risk Factors — We collect, process, store and use personal information and other data, and our actual or perceived failure to protect such information and data or comply with data privacy and security laws and regulations could damage our reputation and brand and harm our business and operating results.
  90. [90] Item 1A, Risk Factors — Our business is subject to risks related to catastrophes, natural disasters, severe weather and human causes beyond our control, which may have a negative impact on our results of operations and financial condition.; Item 1A, Risk Factors — Military and other armed conflicts, including terrorist activities, and related price volatility and geopolitical instability could materially and adversely affect our business and results of operations.
  91. [91] Item 1A, Risk Factors — A deterioration in general economic, political, business or industry conditions would have a material adverse effect on our results of operations, liquidity and financial condition.
  92. [92] Item 1A, Risk Factors — We may be unable to dispose of assets on attractive terms, and may be required to retain liabilities for certain matters.
  93. [93] Item 1A, Risk Factors — We have a significant amount of indebtedness, which will limit our liquidity and financial flexibility.
  94. [94] Item 1A, Risk Factors — We have a significant amount of indebtedness, which will limit our liquidity and financial flexibility.
  95. [95] Item 1A, Risk Factors — Restrictive covenants in certain of our existing and future debt instruments may limit our ability to finance our operations, fund our capital needs, respond to changing conditions and engage in other business activities that may be in our best interests.
  96. [96] Item 1A, Risk Factors — Our ability to declare and pay dividends, and to repurchase common stock, is subject to limitations.
  97. [97] Item 1A, Risk Factors — The trading price and volume of our common stock may be volatile, and you could lose a significant portion of your investment.
  98. [98] Item 1A, Risk Factors — We are subject to extensive governmental regulation, which can change and could adversely impact our business.
  99. [99] Item 1A, Risk Factors — Increasing attention to sustainability matters and our ability to achieve and maintain sustainability certifications, goals and commitments may impact our business, financial results or stock price.
  100. [100] Item 1A, Risk Factors — The taxation of independent producers is subject to change, and changes in tax law could increase our cost of doing business.
  101. [101] Item 1A, Risk Factors — The completion of the Southwestern Merger in 2024 triggered an annual limitation on the utilization of our tax attributes, reducing our ability to offset future taxable income, which may result in an increase to income tax liabilities.
  102. [102] Item 1A, Risk Factors — Judicial decisions can affect our rights and obligations.
  103. [103] Item 7, MD&A — Introduction
  104. [104] Item 7, MD&A — Introduction
  105. [105] Item 7, MD&A — Capital Expenditures
  106. [106] Item 7, MD&A — Capital Expenditures
  107. [107] Item 7, MD&A — Capital Expenditures
  108. [108] Item 7, MD&A — Shareholder Returns

Analysis on 5/21/2026