Abstract

California Resources will report results on March 02, 2026 Pre-Market. This preview summarizes last quarter’s print and the latest quarter’s revenue, margin and EPS expectations alongside recent media commentary to frame the likely setup into the print and the key segment drivers.

Market Forecast

For the current quarter, consensus embedded in the company-facing forecast points to revenue of $772.06 million with a year-over-year decline of 14.00%, EBIT of $80.25 million with a year-over-year decline of 43.71%, and EPS of $0.53 with a year-over-year decline of 45.36%. Last quarter’s results serve as the base for margin context: gross profit margin was 55.58% and net profit margin was 7.29%; current-quarter margin forecasts were not provided. Adjusted EPS forecast was not explicitly provided beyond the $0.53 EPS estimate, and a year-over-year decline of 45.36% is implied by the forecast data. The company’s main business remains upstream oil and gas, with revenue last quarter of $715.00 million. Management and street commentary emphasize that oil and gas price realizations and volumes will guide quarter-on-quarter swings, while power and marketing are secondary contributors. The segment with the most incremental growth potential identified in recent quarters is power-related income and energy marketing, which delivered $101.00 million last quarter and is positioned to benefit from California grid dynamics; year-over-year forecast detail for this segment was not available.

Last Quarter Review

In the previous quarter, California Resources generated revenue of $855.00 million, gross profit margin of 55.58%, GAAP net profit attributable to shareholders of $64.00 million, a net profit margin of 7.29%, and adjusted EPS of $1.46, with year-over-year adjusted EPS down 2.67% and revenue down 36.81%. One key operating highlight was resilience in margins despite sharply lower revenue versus the prior year, supported by hedging and cost discipline. The main-business snapshot shows upstream oil and gas revenue of $715.00 million, power-related revenue of $101.00 million, and marketing/other net effects of $35.00 million, though year-over-year segment growth was not disclosed.

Current Quarter Outlook (with major analytical insights)

Main upstream oil and gas business

The core upstream portfolio remains the dominant earnings driver, and the company’s revenue mix last quarter indicates upstream contributed roughly 83.63% of total revenue at $715.00 million. The current-quarter revenue estimate of $772.06 million, if achieved, would still mark a 14.00% year-over-year contraction, reflecting a softer commodity tape versus the prior-year comparable period and a measured activity cadence. The EBIT estimate of $80.25 million implies a compressed operating margin versus last quarter’s realized profitability, consistent with lower liquids realizations and a heavier turnaround/maintenance slate that can lift lifting costs in parts of the portfolio. Volume stability and the mix between oil and natural gas liquids are likely to be watched closely. California’s regulatory context can stretch permitting timelines and influence decline management, suggesting that management’s capital allocation discipline is as important as wellhead performance in this quarter’s setup. Hedging gains or losses and basis differentials relative to benchmark indices may further skew realized prices; if differentials narrow alongside modest service-cost relief, the downside to EBIT could be partially cushioned even with lower headline revenue.

Power and energy marketing activities

Power-related income and energy marketing delivered $101.00 million in the last reported quarter and represent a meaningful offset to upstream cyclicality in California’s unique grid and pricing environment. While the forecast lacks explicit segment-level year-over-year growth rates, qualitative drivers suggest seasonal and volatility-led uplift can still provide earnings ballast. This quarter, tighter power balances in winter months, potential congestion pricing, and structured contracts could sustain mid- to high-single-digit percentage contribution to company-wide revenue even in a down-cycle upstream backdrop. The market will parse the gross margin trajectory here because this segment can carry structurally higher margins than upstream. If realized margins hold, the reported company-wide gross profit margin could remain comparatively resilient even with a year-over-year revenue decline. Conversely, subdued volatility or lower realized spreads would dampen the segment’s contribution and leave consolidated EBIT more sensitive to the upstream swing factors.

Non-upstream contributions and commodity-linked derivatives

Marketing and other line items, including derivative marks, summed to approximately $35.00 million last quarter on a net basis, with a negative derivative component of $23.00 million partly offset by other revenues. This bucket is often the source of quarter-to-quarter noise, but it can play a disproportionate role when commodity curves shift quickly. Into this quarter, forward curves imply lower year-over-year liquids pricing, so the magnitude and direction of any derivative impact will be a point of scrutiny for investors attempting to triangulate adjusted EPS versus GAAP figures. Given the EPS estimate of $0.53 for this quarter and the implied year-over-year decline of 45.36%, the market appears to be embedding limited derivative uplift and a cautious stance on spreads. Any upside surprise from favorable basis dynamics or contract settlements could narrow the EPS gap relative to consensus, whereas unfavorable marks could exacerbate the compression in EBIT and EPS implied by the forecast.

Analyst Opinions

The majority of recent analyst and institutional commentary leans cautious, reflecting lower year-over-year revenue and EBIT projections and attention to California-specific regulatory and permitting variables. Several well-followed institutions have framed expectations around a soft commodity backdrop and a focus on capital returns discipline as partial mitigants to earnings pressure, resulting in a neutral-to-underweight skew in the broader sentiment balance. Cautious views emphasize the 14.00% expected year-over-year revenue decline and a 43.71% drop in EBIT, arguing that upstream headwinds are unlikely to be fully offset by power and marketing contributions this quarter. The more constructive minority posits that disciplined cost control and potential power-market tailwinds could cap the downside to EPS relative to the $0.53 estimate, especially if differentials and service costs trend favorably. Taking the preponderance of commentary together, the consensus tilts to a guarded stance into March 02, 2026 Pre-Market, with attention squarely on realized prices, volumes, and any incremental disclosure on segment profitability and capital allocation.