Shell Plc (NYSE:SHEL) on Thursday posted second-quarter results, outperforming profit expectations despite softer macro conditions and margin pressures across several segments.

Adjusted earnings per American Depositary Share came in at $1.44, ahead of the $1.21 consensus estimate. However, revenue fell short at $65.41 billion, compared with analysts’ forecast of $69.20 billion.

Total adjusted earnings reached $4.3 billion, supported by strong upstream and integrated gas performance, even as trading contributions and chemicals margins weakened.

Also Read: Shell Sees Lower Production, Softer Trading In Q2

Integrated Gas production declined 2% quarter over quarter to 913,000 barrels of oil equivalent per day, while LNG liquefaction volumes edged up to 6.72 million metric tons. Realized liquids and gas prices dipped to $60 per barrel and $7.20 per thousand standard cubic feet.

Marketing sales volumes rose 5% sequentially to 2.81 million barrels per day, driven by higher Mobility segment output at 2.04 million b/d. Lubricants dipped slightly to 85,000 b/d, while Sectors & Decarbonisation climbed to 684,000 b/d.

Shell generated $11.9 billion in cash flow from operations during the quarter, supporting a newly announced $3.5 billion share buyback set to be completed by the next earnings release.

Total shareholder distributions for the period totaled $5.7 billion, including $3.5 billion in completed repurchases and $2.1 billion in cash dividends. A second-quarter dividend of $0.3580 per share was declared, payable September 22.

The company continued cutting costs, achieving $800 million in structural reductions in the first half of 2025, $500 million of which came from operational streamlining. Cumulative cuts since 2022 now stand at $3.9 billion, tracking toward its $5 billion to $7 billion target by 2028.

Shell also strengthened its deepwater portfolio with increased stakes in Brazil’s Gato do Mato and Nigeria’s Bonga fields. It brought Brazil’s Mero-4 online and marked a milestone with the first shipment from its LNG Canada terminal, part of its broader goal to grow LNG sales by 4% to 5% annually through 2030.

At the end of the quarter, net debt stood at $43.2 billion, up from $41.5 billion in the first quarter, driven by capital returns and lease-related outflows. Gearing rose to 19.1% from 18.7%.

Outlook

During the earnings conference call, Shell’s CFO reportedly indicated an expectation for crude oil trading activity to pick up again throughout the rest of the year, following a muted second quarter. Conversely, the CEO reportedly cautioned that weakness in chemicals markets could persist for a long time.

The company expects Integrated Gas production between 910,000 and 970,000 boe/d and LNG liquefaction volumes of 6.7 to 7.3 million tons. Upstream volumes are projected at 1.7 to 1.9 million boe/d, while Marketing volumes should range from 2.6 to 3.1 million b/d.

Refinery utilization is forecast between 88% and 96%, and Chemicals plant utilization is expected to fall between 78% and 86%.

Corporate Adjusted Earnings were a net expense of $463 million for the second quarter of 2025. Looking ahead, Corporate Adjusted Earnings are expected to be a net expense of approximately $500 million to $700 million in the third quarter of 2025.

Full-year 2025 capital expenditures remain guided at $20 billion to $22 billion.

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Price Action: SHEL shares are trading 0.45% higher at $72.04 premarket at the last check on Thursday.

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