```markdown [PART I. FINANCIAL INFORMATION](index=3&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) This section encompasses unaudited financial statements, management's discussion, market risk disclosures, and internal controls [Item 1. Financial Statements (Unaudited)](index=3&type=section&id=Item%201.%20Financial%20Statements%20%28Unaudited%29) Presents unaudited consolidated financial statements, reflecting significant revenue and net income growth post-Equitrans Midstream Merger Condensed Consolidated Operations Highlights (in thousands, except per share) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Total operating revenues** | $2,557,719 | $952,512 | $4,297,569 | $2,364,780 | | **Operating income** | $1,134,038 | $2,971 | $1,630,288 | $185,691 | | **Net income attributable to EQT** | $784,147 | $9,517 | $1,026,286 | $113,005 | | **Diluted EPS** | $1.30 | $0.02 | $1.70 | $0.25 | Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total current assets** | $1,631,336 | $1,714,679 | | **Net property, plant and equipment** | $31,624,191 | $31,747,818 | | **Total assets** | $39,666,748 | $39,830,255 | | **Total current liabilities** | $2,306,407 | $2,461,549 | | **Total liabilities** | $14,568,898 | $15,552,119 | | **Total equity** | $25,097,850 | $24,278,136 | Condensed Consolidated Cash Flows Highlights (in thousands) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $2,982,866 | $1,477,708 | | **Net cash used in investing activities** | $(1,198,032) | $(879,212) | | **Net cash used in financing activities** | $(1,431,435) | $(649,499) | | **Net change in cash and cash equivalents** | $353,399 | $(51,003) | - Net income attributable to EQT for Q2 2025 was **$784.1 million** (**$1.30/share**), a substantial increase from **$9.5 million** (**$0.02/share**) in Q2 2024. The growth was driven by higher operating revenues, gains on derivatives, and equity earnings from the MVP Joint Venture[196](index=196&type=chunk) - The company expects to spend approximately **$2.30 billion to $2.45 billion** in total capital expenditures in 2025, funded by cash from operations and its revolving credit facility[260](index=260&type=chunk) - Expected sales volume for 2025 is projected to be between **2,300 and 2,400 Bcfe**, including contributions from the **Olympus Energy Acquisition**[260](index=260&type=chunk) - Cash flow from operations increased to **$2.98 billion** for the first six months of 2025, up from **$1.48 billion** in the same period of 2024, due to higher revenues and favorable working capital changes[265](index=265&type=chunk) [Note 2: Financial Information by Business Segment](index=10&type=section&id=Note%202.%20Financial%20Information%20by%20Business%20Segment) Company restructured into Production, Gathering, and Transmission segments post-merger, Production remains primary revenue driver - As a result of the **Equitrans Midstream Merger**, the company changed its internal reporting from one reportable segment to three: Production, Gathering, and Transmission[33](index=33&type=chunk)[34](index=34&type=chunk) Segment Operating Income (Loss) - Q2 2025 (in thousands) | Segment | Operating Income (Loss) | | :--- | :--- | | Production | $1,007,110 | | Gathering | $205,405 | | Transmission | $90,056 | | **Total Segment Operating Income** | **$1,302,571** | Segment Total Assets - June 30, 2025 (in thousands) | Segment | Total Assets | | :--- | :--- | | Production | $22,027,485 | | Gathering | $8,276,505 | | Transmission | $7,635,142 | | **Total Segment Assets** | **$37,939,132** | [Note 3: Revenue from Contracts with Customers](index=16&type=section&id=Note%203.%20Revenue%20from%20Contracts%20with%20Customers) Total revenue significantly increased from natural gas sales and new pipeline revenues post-Equitrans Midstream Merger Disaggregated Revenue from Contracts with Customers - Q2 2025 vs Q2 2024 (in thousands) | Revenue Source | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Natural gas sales | $1,539,205 | $730,705 | | NGLs sales | $145,104 | $139,734 | | Total Gathering pipeline revenue | $320,269 | $74,300 | | Total Transmission pipeline revenue | $134,583 | $0 | | **Total revenues from contracts** | **$1,837,676** | **$892,633** | - As of June 30, 2025, the company has approximately **$11.9 billion** in remaining performance obligations from contracts with fixed consideration, primarily related to gathering and transmission firm reservation fees[82](index=82&type=chunk) - The weighted average remaining term for both third-party and affiliate firm gathering and transmission contracts is approximately **11 to 13 years** as of June 30, 2025[84](index=84&type=chunk) [Note 7: Debt](index=24&type=section&id=Note%207.%20Debt) Total debt decreased to **$8.3 billion** due to repayments, with new EQT notes issued post-Equitrans Midstream Merger Total Debt Outstanding (in thousands) | Date | Principal Value | Carrying Value | | :--- | :--- | :--- | | June 30, 2025 | $8,366,092 | $8,315,037 | | December 31, 2024 | $9,368,516 | $9,324,177 | - During the first six months of 2025, the company repaid, redeemed, or repurchased **$813 million** in principal of various debt tranches[120](index=120&type=chunk)[121](index=121&type=chunk) - On April 2, 2025, the company issued approximately **$3.9 billion** of New EQT Notes in exchange for tendered Existing EQM Notes following the **Equitrans Midstream Merger**[131](index=131&type=chunk) - On July 16, 2025, EQM issued notices for the full redemption of all its outstanding notes (approx. **$92.7 million**), which will be completed by July 31, 2025[122](index=122&type=chunk) [Note 11: Acquisitions](index=29&type=section&id=Note%2011.%20Acquisitions) Company completed **Equitrans Midstream Merger** and **Olympus Energy Acquisition**, adding significant assets and goodwill - On July 1, 2025, EQT completed its acquisition of **Olympus Energy Acquisition** for **$500 million** cash and **25.2 million shares** of EQT common stock[154](index=154&type=chunk)[155](index=155&type=chunk) - The **Equitrans Midstream Merger** was completed on July 22, 2024, with total consideration of **$6.0 billion**, including **$5.5 billion** in equity. The acquisition was accounted for as a business combination, resulting in **$2.06 billion** of goodwill[158](index=158&type=chunk)[159](index=159&type=chunk)[162](index=162&type=chunk)[163](index=163&type=chunk) - The goodwill from the **Equitrans Midstream Merger** is attributed to expected synergies from vertical integration (**$1.23B**) and deferred tax liabilities (**$831M**), and was allocated entirely to the Transmission segment[165](index=165&type=chunk) [Note 13: Commitments and Contingencies](index=32&type=section&id=Note%2013.%20Commitments%20and%20Contingencies) Company agreed to a **$167.5 million** settlement in Securities Class Action, expecting **$16 million** insurance recovery - On May 12, 2025, the parties in the Securities Class Action agreed to a settlement where the company will pay **$167.5 million** to the plaintiffs[179](index=179&type=chunk) - As a result of the settlement, the company increased its accrual for estimated loss contingencies by **$150 million** in Q2 2025, resulting in a total reserve of **$167.5 million**[179](index=179&type=chunk) - The company expects to recover approximately **$16 million** of the settlement amount through insurance[179](index=179&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=34&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses increased net income from mergers and higher commodity prices, detailing segment performance, capital expenditures, and liquidity - Net income attributable to EQT for Q2 2025 was **$784.1 million** (**$1.30/share**), a substantial increase from **$9.5 million** (**$0.02/share**) in Q2 2024. The growth was driven by higher operating revenues, gains on derivatives, and equity earnings from the MVP Joint Venture[196](index=196&type=chunk) - The company expects to spend approximately **$2.30 billion to $2.45 billion** in total capital expenditures in 2025, funded by cash from operations and its revolving credit facility[260](index=260&type=chunk) - Expected sales volume for 2025 is projected to be between **2,300 and 2,400 Bcfe**, including contributions from the **Olympus Energy Acquisition**[260](index=260&type=chunk) - Cash flow from operations increased to **$2.98 billion** for the first six months of 2025, up from **$1.48 billion** in the same period of 2024, due to higher revenues and favorable working capital changes[265](index=265&type=chunk) [Business Segment Results of Operations](index=40&type=section&id=Business%20Segment%20Results%20of%20Operations) New three-segment structure shows strong Q2 2025 performance, with Production income soaring and new Gathering and Transmission segments contributing Production Segment Operating Results - Q2 2025 vs Q2 2024 | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total sales volume (MMcfe) | 568,227 | 507,512 | 12.0% | | Average sales price ($/Mcfe) | $2.99 | $1.75 | 70.9% | | Total operating revenues (thousands) | $2,420,542 | $949,396 | 155.0% | | Operating income (loss) (thousands) | $1,007,110 | $(7,012) | 14,462.7% | Gathering Segment Operating Results - Q2 2025 vs Q2 2024 | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total gathered volume (BBtu/d) | 9,827 | 1,555 | 532% | | Total operating revenues (thousands) | $320,269 | $74,300 | 331% | | Operating income (thousands) | $205,405 | $53,871 | 281% | Transmission Segment Operating Results - Q2 2025 | Metric | Q2 2025 | | :--- | :--- | | Total transmission pipeline throughput (BBtu/d) | 4,279 | | Total operating revenues (thousands) | $134,583 | | Operating income (thousands) | $90,056 | [Capital Resources and Liquidity](index=50&type=section&id=Capital%20Resources%20and%20Liquidity) Operating cash flow and credit facilities are sufficient for **$2.3-$2.45 billion** 2025 capital expenditures and debt service - The company plans total capital expenditures of **$2,300 million to $2,450 million** for 2025[260](index=260&type=chunk) - On July 1, 2025, the company funded the **$500 million** cash portion of the **Olympus Energy Acquisition** with cash on hand and borrowings under its revolving credit facility[262](index=262&type=chunk) - During the first six months of 2025, financing activities included repayment of debt, dividends, and **$152 million** in distributions to the Midstream Joint Venture's Class B Unitholder[272](index=272&type=chunk)[273](index=273&type=chunk) - The Board of Directors declared a quarterly cash dividend of **$0.1575 per share**, payable on September 2, 2025[274](index=274&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=55&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Company manages natural gas and NGL price volatility through hedging; a **10%** price decrease would increase derivative fair value by **$146 million** - A hypothetical **10% decrease** in the NYMEX natural gas price as of June 30, 2025, would increase the fair value of the company's natural gas derivative instruments by approximately **$146 million**[296](index=296&type=chunk) - A hypothetical **10% increase** in the NYMEX natural gas price as of June 30, 2025, would decrease the fair value of the company's natural gas derivative instruments by approximately **$144 million**[296](index=296&type=chunk) - A **1% increase** in interest rates on borrowings under its revolving credit facilities during the first six months of 2025 would have increased interest expense by approximately **$2 million**[299](index=299&type=chunk) [Item 4. Controls and Procedures](index=57&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls were **effective**, with ongoing integration of **Equitrans Midstream Corporation's** internal controls - The principal executive officer and principal financial officer concluded that disclosure controls and procedures were **effective** as of the end of the reporting period[306](index=306&type=chunk) - The company is in the process of integrating the internal controls of **Equitrans Midstream Corporation**, which was acquired on July 22, 2024. This integration process may result in changes to internal controls[307](index=307&type=chunk) [PART II. OTHER INFORMATION](index=57&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section covers legal proceedings, risk factors, equity security sales, and a list of exhibits filed with the report [Item 1. Legal Proceedings](index=57&type=section&id=Item%201.%20Legal%20Proceedings) Investigations into the Pratt Storage Field incident remain open, with a subsidiary facing a criminal complaint, no material adverse impact expected - Regarding the 2018 Pratt Storage Field incident, investigations by the Pennsylvania Public Utilities Commission and PHMSA are still open[311](index=311&type=chunk) - On October 30, 2023, Equitrans, L.P. received a criminal complaint from the PA Attorney General's Office for alleged violations of the Clean Streams Law related to the Pratt Incident. The company does not expect the resolution to have a material adverse impact[313](index=313&type=chunk) [Item 1A. Risk Factors](index=58&type=section&id=Item%201A.%20Risk%20Factors) There are **no material changes** to the risk factors previously disclosed in the Annual Report on Form 10-K for 2024 - There are **no material changes** to the risk factors disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024[314](index=314&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=58&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) **No equity securities were repurchased** in Q2 2025, with **$1.4 billion** remaining under the extended **$2 billion** share repurchase program - **No equity securities were repurchased** during the second quarter of 2025[315](index=315&type=chunk) - The Board of Directors extended the **$2 billion Share Repurchase Program** to expire on **December 31, 2026**[316](index=316&type=chunk) - As of June 30, 2025, approximately **$1.4 billion** remains available for purchase under the Share Repurchase Program[316](index=316&type=chunk) [Item 6. Exhibits](index=59&type=section&id=Item%206.%20Exhibits) This section lists exhibits filed with the Form 10-Q, including supplemental indentures, registration rights agreements, and officer certifications ```

Market Trends & Industry Dynamics - Natural gas prices are currently soft due to disappointing weather and oversupply, but the long-term outlook is strong [2] - The rise of AI is creating major league demand for natural gas [2] - The United States winning the AI race is a significant economic and national security opportunity [4] - Natural gas demand for AI is projected to increase by 10% to almost 20%, representing 10 to 18 BCF (billion cubic feet) per day [7][8] EQT's Strategy & Performance - EQT has transformed into a large-scale integrated natural gas champion over the last 5 years [2] - EQT is positioning itself to meet the growing demand from AI by connecting natural gas supply to power plants [2][5] - EQT has announced over 15 BCF (billion cubic feet) per day of natural gas supply deals to power plants that will feed AI demand [5] - EQT added a power plant in West Virginia that's about 600 MW (megawatts) [6] - EQT believes this is just the beginning and has a robust growth pipeline [5]

Financial Data and Key Metrics Changes - EQT reported strong momentum in Q2 2025, with production at the high end of guidance, benefiting from robust well productivity and compression project outperformance [5] - Free cash flow for Q2 was approximately $240 million, despite incurring $134 million in net expenses related to a litigation settlement, which if excluded, would have resulted in free cash flow of approximately $375 million [7] - Cumulative free cash flow generation totaled nearly $2 billion over the past three quarters, with natural gas prices averaging $3.3 per million Btu during this period [7][8] Business Line Data and Key Metrics Changes - The compression program is ahead of schedule and below budget, driving production uplift well above expectations [5] - The acquisition of Olympus Energy on July 1, 2025, added significant production capacity and core inventory, enhancing EQT's operational capabilities [8] - The company expects to generate approximately $250 million of recurring free cash flow from new projects by 2029, with a collective growth CapEx opportunity of around $1 billion over the next several years [18][19] Market Data and Key Metrics Changes - EQT's updated 2025 production guidance range is 2,300 to 2,400 Bcfe, including approximately 100 Bcfe from Olympus in the second half of the year [27] - The company anticipates a tightening of the Appalachian gas market due to increasing demand from LNG exports and new power generation facilities [24][26] Company Strategy and Development Direction - EQT's strategy focuses on reducing cash flow risk and creating pathways for sustainable cash flow growth through a pipeline of low-risk, high-return projects [15][21] - The company is leveraging its integrated platform to meet new demand with supply backed by firm contracts, rather than chasing commodity price signals [14][15] - EQT aims to operate with a maximum of $5 billion in net debt, allowing for flexibility in capital allocation and growth opportunities [17][18] Management's Comments on Operating Environment and Future Outlook - Management expressed a structurally bullish view on natural gas prices, anticipating a tightening market due to slowing associated gas growth and increasing LNG demand [23][24] - The company remains disciplined in production growth, focusing on reallocating existing volumes to meet new demand rather than increasing production indiscriminately [39][40] - Management highlighted the importance of maintaining a low-cost structure and investment-grade credit ratings to support sustainable growth [15][17] Other Important Information - EQT has secured long-term agreements for natural gas supply to support significant power generation projects, including a 3.6 gigawatt facility in Pennsylvania [11][12] - The company is also advancing midstream projects that are expected to enhance natural gas delivery reliability and reduce energy costs for consumers [10][13] Q&A Session Summary Question: Can you address the CapEx cadence to achieve $250 million of free cash flow growth by 2029? - Management indicated that the $1 billion CapEx related to midstream projects will be back-weighted towards 2028, allowing for flexibility in upstream production growth [35][36] Question: What would it take for EQT to add production instead of reallocating? - Management emphasized the need to be disciplined and responsive to market pricing, with potential production growth translating to significant free cash flow upside [39][41] Question: Can you discuss the evolution of capital spending in the base business? - Management noted that maintenance capital spending is expected to decrease while growth capital spending will increase, reflecting ongoing efficiency gains [47][48] Question: How do you see the timeline for reaching full capacity in new power generation projects? - Management expects to reach full capacity for the Shippingport and Homer City projects by the end of 2028, coinciding with other significant infrastructure expansions [56] Question: How do you view the current pricing dynamics in the market? - Management acknowledged that while current production levels are higher than expected, they remain focused on aligning supply with known demand through their infrastructure [70][72]

Financial Data and Key Metrics Changes - The company reported approximately $240 million of Q2 free cash flow, despite incurring $134 million in net expenses related to a litigation settlement [6] - Cumulative free cash flow generation totaled nearly $2 billion over the past three quarters, with natural gas prices averaging just $3.3 per million Btu during this period [6] - The company exited the quarter with $7.8 billion of net debt, down approximately $350 million compared to Q1, marking nearly $6 billion of debt reduction over the past three quarters [16] Business Line Data and Key Metrics Changes - Production was at the high end of guidance, benefiting from robust well productivity and outperformance from compression projects [5] - Capital spending came in approximately $50 million below the low end of guidance, driven by midstream spending optimization and lower well costs [5] - The company closed on the acquisition of Olympus Energy, which is expected to enhance production and operational integration [7] Market Data and Key Metrics Changes - The company expects to add 180,000 horsepower of compression to the MVP mainline, increasing capacity from 2 to 2.5 Bcf per day, to serve Southeast markets [8] - The MVP Southgate project is expected to provide 550 million cubic feet per day of capacity into the Carolinas, enhancing natural gas delivery reliability [9] - The company anticipates significant demand growth in the Southeast, driven by new projects and partnerships [10] Company Strategy and Development Direction - The company is focused on sustainable growth through a pipeline of low-risk, high-return projects in both midstream and upstream businesses [8] - The strategy includes reducing cash flow risk and creating pathways for sustainable cash flow growth, with a focus on organic investment opportunities [14] - The company aims to leverage its low-cost structure and integrated infrastructure to capture new demand and meet it with supply backed by firm contracts [13] Management's Comments on Operating Environment and Future Outlook - Management expressed a structurally bullish view for natural gas prices looking out to 2026 and 2027, despite near-term headwinds [22] - The company noted that U.S. oil activity is expected to remain subdued, curbing a major source of incremental gas supply [23] - Management highlighted the importance of maintaining flexibility in production decisions based on market conditions and pricing signals [40] Other Important Information - The company has a pipeline of nearly $1 billion of organic investment opportunities, expected to generate an aggregate free cash flow yield of approximately 25% once fully online [12] - The company is working on long-term agreements to supply natural gas for significant power generation projects, enhancing its growth potential [10][11] - The company plans to continue focusing on debt paydown while also exploring opportunistic share buybacks during market downturns [20] Q&A Session Summary Question: Can the company continue to build cash while spending on growth? - Management emphasized the ability to generate robust free cash flow while funding sustainable growth opportunities, with capital expenditures back-weighted towards 2028 [34][36] Question: What would it take to add production instead of reallocating? - Management indicated that production growth decisions would be based on market pricing and demand signals, with a focus on maintaining flexibility [38][40] Question: Can management discuss the evolution of capital spending? - Management noted that maintenance capital expenditures are expected to decrease while growth capital expenditures will increase, reflecting operational efficiencies [46] Question: How does the company view the LNG contracting plans? - The company aims to link supply directly to end users in the LNG market, with a long-term goal of maintaining 5% to 10% of volume in LNG contracts [88][90] Question: What is the outlook for the M2 pricing dynamics? - Management discussed the potential for basis tightening in the M2 market, with a focus on matching supply with demand through existing infrastructure [95][100]

Financial Performance - EQT's 2Q25 total sales volumes reached 568 Bcfe[8] - The average realized price was $2.81 per Mcfe[8] - Adjusted EBITDA attributable to EQT was $1,033 million[8] - Free cash flow attributable to EQT was $240 million[8] - Capital expenditures amounted to $554 million[8] Operational Efficiency and Cost Reduction - Capital spending was 15% below guidance midpoint due to efficiency gains[9] - Per unit operating costs were below the low-end of guidance due to lower LOE and SG&A expense[9] - Updated guidance increases annual production by 100 Bcfe and lowers operating cost guidance by 6 cents per Mcfe[9] Strategic Growth and Infrastructure Projects - Working to finalize agreements for Shippingport Power Station (800 MMcf/d) and Homer City Redevelopment project (665 MMcf/d)[10] - Launched open season for MVP Boost, providing 500 MMcf/d of incremental takeaway capacity[10] - Closed on the Olympus Acquisition on July 1st[10] Debt Management - Total debt was ~$8.3 billion and net debt was ~$7.8 billion, down ~$1.4 billion from YE24 and nearly $6 billion below 3Q24 levels[9]

Core Insights - EQT Corporation reported second-quarter 2025 adjusted earnings from continuing operations of 45 cents per share, exceeding the Zacks Consensus Estimate of 44 cents, and a significant improvement from a loss of 8 cents in the same quarter last year [1][9] - Adjusted operating revenues rose to $1,599 million from $1,183 million year-over-year, although it fell short of the Zacks Consensus Estimate of $1,793 million [1][9] Production - Sales volume increased to 568 billion cubic feet equivalent (Bcfe) from 508 Bcfe year-over-year, but missed the estimate of 569 Bcfe [3] - Natural gas sales volume was 534.4 Bcf, up from 474.1 Bcf in the prior year, but also missed the estimate of 535.3 Bcf [3] - Total liquid sales volume reached 5,631 thousand barrels (MBbls), slightly up from 5,573 MBbls year-over-year, but below the projection of 5,660.6 MBbls [3] Commodity Price Realizations - The average realized price for natural gas equivalent was $2.81 per thousand cubic feet (Mcfe), an increase from $2.33 year-over-year [4] - The average natural gas price, including cash-settled derivatives, rose to $2.69 per Mcf from $2.16 [4] - The natural gas sales price was $3.63 per Mcf, significantly higher than $2.02 recorded a year ago [4] - Oil price was reported at $51.70 per barrel, down from $61.96 year-over-year, and below the estimate of $47.19 [5] Expenses - Total operating expenses increased to $1.42 billion from $949.5 million in the prior-year quarter [6] - Gathering expenses decreased to 8 cents per Mcfe from 59 cents year-over-year, while transmission expenses rose to 45 cents per Mcfe from 35 cents [6] - Lease operating expenses remained flat at 9 cents year-over-year [6] Cash Flows - Adjusted operating cash flow totaled $918 million, up from $405 million a year ago [7] - Free cash flow improved to $340 million from a negative $171 million in the same quarter last year [7] Capex & Balance Sheet - Total capital expenditure was $554 million, down from $576 million reported a year ago [10] - As of June 30, 2025, the company had cash and cash equivalents of $555 million and net debt of $7.76 billion [10] Guidance - For Q3 2025, EQT anticipates total sales volume between 590-640 Bcfe [11] - The full-year sales volume forecast has been raised to 2,300-2,400 Bcfe, an increase of 100 Bcfe from earlier projections [11] - Capital expenditures are projected to be in the range of $2,300-$2,450 million for the full year [11]

Group 1: Earnings Performance - EQT Corporation reported quarterly earnings of $0.45 per share, exceeding the Zacks Consensus Estimate of $0.44 per share, compared to a loss of $0.08 per share a year ago, representing an earnings surprise of +2.27% [1] - Over the last four quarters, the company has surpassed consensus EPS estimates four times [2] - The company posted revenues of $1.6 billion for the quarter ended June 2025, missing the Zacks Consensus Estimate by 10.81%, compared to year-ago revenues of $1.18 billion [2] Group 2: Stock Performance and Outlook - EQT shares have increased approximately 16.1% since the beginning of the year, outperforming the S&P 500's gain of 7.2% [3] - The current consensus EPS estimate for the coming quarter is $0.66 on revenues of $1.98 billion, and for the current fiscal year, it is $3.37 on revenues of $8.37 billion [7] - The estimate revisions trend for EQT was mixed ahead of the earnings release, resulting in a Zacks Rank 3 (Hold) for the stock, indicating expected performance in line with the market [6] Group 3: Industry Context - The Oil and Gas - Exploration and Production - United States industry is currently in the bottom 28% of over 250 Zacks industries, which may impact stock performance [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that tracking these revisions can be beneficial for investors [5]

Production Performance - Second quarter 2025 production reached 568 Bcfe, at the high-end of guidance, reflecting strong well performance and compression project outperformance, an increase of 60 Bcfe from 508 Bcfe in Q2 2024[6] - The company reported a production volume of 568,227 MMcfe for the three months ended June 30, 2025, compared to 507,512 MMcfe in the previous quarter[57] - Natural gas sales volume increased to 534,441 MMcf in Q2 2025, up from 474,075 MMcf in Q2 2024, representing a growth of 12.7%[71] - The company reported a total sales volume of 568,227 MMcf in Q2 2025, an increase from 507,512 MMcf in Q2 2024, representing a growth of 11.9%[71] Financial Performance - Net income attributable to EQT for Q2 2025 was $784 million, a significant increase of $774 million compared to $10 million in Q2 2024[8] - Adjusted EBITDA attributable to EQT was $1,033 million, up $563 million from $470 million in the same quarter last year[8] - Total operating revenues for Q2 2025 reached $2,557,719, a significant increase from $952,512 in Q2 2024, representing a growth of approximately 168%[67] - Net income attributable to EQT Corporation for the first half of 2025 was $1,026,286, compared to $113,005 in the same period of 2024, marking an increase of about 810%[67] - Operating income for the first half of 2025 was $1,630,288, up from $185,691 in the first half of 2024, reflecting a growth of approximately 777%[67] Cash Flow and Expenditures - The company generated $240 million of free cash flow attributable to EQT in Q2 2025, a turnaround from a negative $171 million in Q2 2024[8] - Free cash flow for the three months ended June 30, 2025, was $340,218,000, compared to a negative free cash flow of $171,095,000 in the same period of 2024[46] - Capital expenditures for Q2 2025 were $554 million, 15% below the mid-point of guidance, due to efficiency gains and midstream project optimization[6] - Capital expenditures for the first half of 2025 were $1,049,289, slightly lower than $1,092,633 in the same period of 2024[69] Debt and Liquidity - Total debt as of June 30, 2025, was $8.3 billion, with net debt down approximately $1.4 billion from year-end 2024[14] - Total liquidity as of June 30, 2025, was $4.1 billion, with no borrowings outstanding under the $3.5 billion revolving credit facility[14] - Net debt as of June 30, 2025, was $7,759,545, down from $9,122,084 at the end of 2024[60] Guidance and Future Plans - Updated guidance for 2025 includes an increase in total sales volume guidance by 100 Bcfe to 2,300 – 2,400 Bcfe, while lowering per-unit operating cost guidance by 6 cents per Mcfe[15] - The company plans to turn-in-line 95 – 120 net wells in 2025, including 24 – 36 net wells in Q3 2025[15] Market and Pricing - Average sales price for natural gas was $2.99 per Mcfe for the three months ended June 30, 2025, up from $1.75 per Mcfe in the previous quarter[57] - Average natural gas price rose to $3.63 per Mcf in Q2 2025, compared to $2.02 per Mcf in Q2 2024, reflecting a significant increase of 80%[71] - The average NGLs price, including cash settled derivatives, was $35.64 per Bbl in Q2 2025, down from $37.44 per Bbl in Q2 2024, a decrease of 4.3%[71] Strategic Transactions - The Olympus Acquisition was completed on July 1, 2025, with integration expected to be largely completed within 30 days[6] - The company completed the Equitrans Midstream Merger in July 2024, which significantly increased its equity method investments[32] - The company expects to continue benefiting from its equity method investments following the Equitrans Midstream Merger completed in July 2024[43] Adjusted Metrics - Adjusted net income attributable to EQT for Q2 2025 was $273.1 million, resulting in an adjusted EPS of $0.45[29] - Adjusted EBITDA for Q2 2025 was $1.16 billion, with adjusted EBITDA attributable to EQT at $1.03 billion[36] - Adjusted operating cash flow for the three months ended June 30, 2025, was $917,878,000, up from $405,040,000 in the same period of 2024[46]

Core Insights - EQT Corporation reported strong financial and operational results for Q2 2025, highlighting operational excellence and robust financial performance [3][6] - The company generated approximately $3.7 billion in cumulative net cash from operating activities and nearly $2 billion in cumulative free cash flow over the past three quarters [3][8] - EQT is focusing on in-basin supply and midstream growth projects to enhance sustainable growth pathways [3][8] Financial Performance - Total sales volume reached 568 Bcfe, an increase from 508 Bcfe in Q2 2024, reflecting strong well performance [6][8] - Average realized price increased to $2.81 per Mcfe from $2.33 per Mcfe year-over-year [6][8] - Net income attributable to EQT was $784 million, a significant increase from $10 million in Q2 2024 [6][8] - Adjusted net income attributable to EQT was $273 million, compared to a loss of $37 million in the same quarter last year [6][8] - Free cash flow attributable to EQT was $240 million, a recovery from a loss of $171 million in Q2 2024 [6][8] Operational Efficiency - Capital expenditures were $554 million, 15% below the mid-point of guidance due to efficiency gains [8] - Total per unit operating costs were $1.08 per Mcfe, below the low-end of guidance, driven by lower lease operating expenses and SG&A [7][8] - The company achieved a record-setting quarter for completion efficiency and lower well costs [3][8] Strategic Initiatives - EQT is advancing multiple in-basin natural gas power and data center demand projects, leveraging its production scale and integrated infrastructure [3][8] - The company closed the acquisition of Olympus Energy's upstream and midstream assets on July 1, 2025, with integration expected to be completed within 30 days [8] - EQT is working to finalize agreements for supplying natural gas to significant power projects, including the Shippingport Power Station and the Homer City Redevelopment project [8] Guidance and Outlook - The company updated its 2025 guidance, increasing total sales volume expectations to 2,300 – 2,400 Bcfe, an increase of 100 Bcfe from prior guidance [16] - Full-year per unit operating cost guidance was lowered by 6 cents per Mcfe, reflecting efficiency gains from the Olympus Acquisition [16] - EQT plans to turn-in-line 95 – 120 net wells in 2025, with expectations for Q3 sales volume between 590 – 640 Bcfe [16][17]

Group 1 - Natural gas producers and transportation stocks have significantly declined, following a drop in U.S. natural gas futures, erasing most of last week's gains due to cooler weather forecasts and high production levels near 107 billion cubic feet [1] - The number of natural gas drilling rigs in the U.S. increased by 9 to a total of 117, indicating plans for increased production, which may provide short-selling opportunities in the natural gas market [1] - The NYMEX August natural gas futures price fell sharply by 6.7% to $3.325 per million British thermal units, marking the lowest settlement price since July 11 [1] Group 2 - The four biggest decliners in the S&P 500 index were all from the natural gas energy sector, with EQT Energy down 9.5%, Expand Energy down 8.5%, Coterra Energy down 5.3%, and Targa Resources down 4.5% [2] - The significant drop in natural gas futures and related stocks is rare this year, especially following favorable policies for the oil and gas industry and the ongoing high temperatures driving demand [2] - Major tech companies like Google, Microsoft, and Amazon AWS are significantly increasing their demand for natural gas due to the construction of large data centers, which aligns with the global trend towards cleaner energy sources [2] Group 3 - The importance of natural gas resources, particularly liquefied natural gas (LNG), is increasing as countries seek cleaner energy alternatives to oil and coal, making it a core energy source for large AI data centers in the coming years [3]