Chevron Corporation (NYSE:CVX) shares traded higher Friday after the energy giant reported second-quarter 2026 results that topped Wall Street expectations, driven by record U.S. production, stronger refining margins and higher oil prices.

The earnings come as elevated crude prices, fueled by the Iran conflict, boosted profits across the oil sector. According to CNBC, both Chevron and ExxonMobil Holdings Corp. (NYSE:XOM) benefited from the rally.

Chevron CEO Mike Wirth told CNBC that global oil markets remain under pressure as geopolitical risks have expanded beyond the Strait of Hormuz while global inventories continue to tighten.

Chevron Earnings Beat And One-Time Impacts

Adjusted EPS of $6.06 beat the $5.56 estimate. Total revenues and other income rose 56.3% to $70.06 billion, topping the $61.97 billion estimate.

GAAP earnings increased to $12.07 billion, or $6.11 per share, from $2.49 billion, or $1.45 per share. Adjusted earnings rose to $11.98 billion from $3.05 billion.

Results included a $230 million asset-sale gain and $86 million in pension costs. They also reflected a $49 million currency headwind and $1.4 billion in favorable timing effects.

Return on capital employed rose to 21.4% from 6.2%, while capital spending increased to $4.54 billion, mainly due to legacy Hess assets.

Record Upstream Production

Upstream earnings rose to $8.18 billion from $2.73 billion, while worldwide production increased 20% to 4.07 million barrels daily.

Growth reflected Hess contributions and gains in the Permian Basin and Gulf of America.

U.S. production reached a record 2.08 million barrels per day. International production rose by 292,000 barrels daily, partly offset by Middle East-related curtailments in the Saudi-Kuwait Partitioned Zone.

Downstream Margins And Refinery Performance

Downstream earnings increased to $4.87 billion from $737 million. U.S. refinery crude inputs reached a record 1.07 million barrels per day, with utilization above 97%.

International refinery inputs fell 10% because of Middle East supply disruptions.

Refined-product sales declined 13% amid the disruptions and lower gasoline and diesel demand.

Cash Flow And Strategic Priorities

Operating cash flow rose to $22.63 billion from $8.58 billion a year earlier, while free cash flow reached $18.10 billion.

Chevron ended the quarter with $8.53 billion in cash and $37.08 billion in debt after a record $8.4 billion debt reduction. It also repurchased $3.12 billion of shares and declared a $1.78 quarterly dividend.

The company achieved $3 billion in annual cost reductions and $1.5 billion in Hess synergies, exceeding its initial target by 50%.

Chevron signed a 20-year agreement to supply 2.67 gigawatts of power to a Microsoft data center and advanced additional Asian asset sales.

"Faced with geopolitical uncertainty and market volatility, Chevron’s people remain focused on safely delivering the reliable energy the world needs," Wirth said.

"Our strong second quarter performance is a result of disciplined investment and strong execution that drove record U.S. upstream production, record crude throughput in our U.S. refineries, and exceptional reliability across key assets."

Chevron Price Action

CVX Stock Price Activity: Chevron shares were up 0.88% at $194.00 in the premarket trading on Friday, according to Benzinga Pro data.

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