Investing.com -- BP Plc (LON:BP) reported weaker-than-expected first-quarter net income Tuesday, missing consensus estimates by 10% and cutting its share buyback to the bottom of its prior guidance range, triggering a more than 3% drop in its shares.
The British oil major posted net income of $1.38 billion for the first quarter of 2025, falling short of the company-compiled consensus of $1.53 billion.
Despite the earnings miss, underlying operating performance was stable, with EBIT in line with consensus at $4.46 billion.
Cash flow from operations, excluding working capital movements, totaled $6.2 billion, modestly above Visible Alpha consensus of $6.1 billion. The beat was largely attributed to lower-than-expected cash taxes.
BP’s upstream production is expected to remain flat quarter-over-quarter in the second quarter. However, the company flagged significantly higher turnaround activity in its downstream segment, consistent with prior guidance for a front-loaded maintenance season.
Divestment proceeds for 2025 are now projected between $3 billion and $4 billion, skewed toward the second half of the year.
Capital expenditure guidance was trimmed to $14.5 billion for the full year, down from $15 billion previously.
The shareholder return outlook also narrowed. BP plans to repurchase $750 million in shares during the second quarter, at the bottom of the previously stated $750 million to $1 billion per quarter range.
RBC analysts noted that the lower buyback was anticipated given a softer macro environment and recent commentary.
BP’s total shareholder return now stands at 10.4%, trailing behind rivals Shell (LON:SHEL) at 11.5% and TotalEnergies (EPA:TTEF) at 12.6%, as per RBC Capital Markets.
In terms of divisional performance, a stronger showing from the customer business and lower corporate costs helped offset weaker results from gas and low-carbon operations.
BP attributed the latter’s underperformance to higher non-cash costs. Minority interest payments were also higher than forecast at $295 million, versus $200 million expected by RBC.
Net debt increased to $27 billion in the first quarter, up from $23 billion at the end of 2024. The rise reflects a $3.3 billion working capital build, in line with management’s previous guidance.