SM Energy (NYSE: SM) reported Q2 EPS of $1.50, $0.23 better than the analyst estimate of $1.27. Revenue for the quarter came in at $792.94 million versus the consensus estimate of $785.7 million.

2025 OPERATING PLAN AND GUIDANCE

The Company is unable to provide a reconciliation of forward-looking non-GAAP capital expenditures because components of the calculation are inherently unpredictable, such as changes to, and timing of, capital accruals. The inability to project certain components of the calculation would significantly affect the accuracy of a reconciliation.

UPDATED GUIDANCE FULL YEAR 2025:

Full year guidance for net production is unchanged at 200 to 215 MBoe/d.
Oil production, as a percent of total production, is increased to a range of 53% to 54%, or 106 to 116 MBbl/d, from previous guidance of 51% to 52%.
Full year guidance for capital expenditures (net of the change in capital accruals),(1) excluding acquisitions, is increased from approximately $1.3 billion to approximately $1.375 billion primarily to accommodate certain previously excluded non-operated capital projects. The Company has increased the estimated number of net wells to be drilled in 2025 to approximately 115 from 105. The number of net wells expected to be completed remains unchanged at approximately 150. The incremental capital is not expected to result in a production impact in 2025.
Full year guidance for DD&A expense is increased to approximately $16/Boe, from previous guidance of $15/Boe, due to the increase in expected full-year oil production.
Subsequent to June 30, 2025, the One Big Beautiful Bill Act (\"OBBBA\") was signed into law. The Company is currently evaluating the potential impacts, but expects to benefit from certain provisions including: the reinstatement of 100% bonus depreciation on tangible assets, the expensing of certain qualified R&D expenditures, and a less restrictive limitation on the business interest expense deduction. While this evaluation is ongoing, the Company reduced its estimate for cash taxes for 2025 to approximately $10 million from a range of $75 million to $95 million previously. The Company expects the financial impact from the OBBBA to be reflected in its third quarter results.
Other expense line items remain unchanged.

GUIDANCE THIRD QUARTER 2025:

Capital expenditures (net of the change in capital accruals),(1) excluding acquisitions is expected to range between $300 million and $320 million. In the third quarter, the Company expects to drill approximately 25 net wells and complete approximately 30 net wells.
Net production is expected to be approximately 209 to 215 MBoe/d at 53% to 54% oil, or 111 to 116 MBbl/d.

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