Chevron Corp.

Chevron's Q3 2025 preliminary estimates highlight the initial financial integration of the Hess Corporation acquisition. The company projects an after-tax loss of $(200) to $(400) million directly attributable to Hess, primarily driven by significant severance and other transaction costs estimated between $(350) and $(450) million. However, on an adjusted basis, excluding these one-time integration expenses, the Hess acquisition is expected to contribute positively to earnings, with an estimated impact of $50 to $150 million.

Operationally, the acquired Hess assets are projected to contribute 450-500 MBOED in net oil-equivalent production for Q3 2025, factoring in some downtime. Depreciation, depletion, and amortization (DD&A) related to legacy Hess and purchase price allocation are estimated between $1.2-$1.4 billion. Capital expenditures for the Hess segment are anticipated to be $1.0-$1.25 billion. The company also reported expected proceeds and deposits of $410 million from asset sales, specifically a Malaysia/Thailand JDA asset sale.

Management commentary emphasizes the expectation of realizing significant synergies from the Hess transaction in future quarters, with approximately half of the cash outflows for severance and transaction costs occurring in Q3 2025 and the remainder within the next 12 months. A working capital outflow of $0.5 to $1.5 billion is expected for Q3 2025. The company estimates approximately 2 billion shares outstanding at quarter-end and 1.95 billion weighted average shares outstanding for the quarter. While initial integration costs are substantial, the underlying adjusted performance and future synergy expectations suggest a strategic long-term benefit from the acquisition. The preliminary nature of these estimates, subject to final accounting and reporting, is a key consideration, along with general industry risks such as commodity price fluctuations and regulatory changes.