Shell Posts Lower Q4 Profit Despite Share Buyback Announcement
London-based energy giant Shell reported a lower-than-projected fourth-quarter profit of $3.66 billion, missing analysts' estimates. The company attributed the shortfall to reduced refining margins and decreased liquefied natural gas (LNG) trading activities.
Despite the profit decline, Shell announced a $3.5 billion share buyback program and a 4% dividend increase. The company's CEO, Wael Sawan, has implemented cost-cutting measures and strategic realignment, focusing on maximizing profitability in oil, gas, and biofuels while deemphasizing renewable energy generation.
The downturn in profits reflects a broader trend among global oil and gas companies experiencing declining earnings since 2024. The reduced profit margins result from stabilizing energy prices and softening oil demand. Adjusted earnings, which Shell defines as net profit, reached $3.66 billion for the quarter ending December 31, down from $7.31 billion during the same period the previous year. This figure fell short of the $4.09 billion consensus estimate provided by Vara Research analysts.