Chevron second quarter 2026 earnings explained: segments, EPS and valuation multiples

Chevron reported its second quarter 2026 results on July 31, 2026. It has since reported its third quarter, on October 30, 2026, and a separate Dalsna Finance article covers those results. This article looks back at the three months ended June 30, 2026 and compares them with the first quarter. Earnings under GAAP, the standard US accounting rules, were $12,072 million against $2,210 million, and adjusted earnings, a non GAAP measure Chevron reports itself, were $11,977 million against $2,793 million, as reported by Chevron. Every figure is sourced and dated, and every number worked out by us is labelled as a Dalsna Finance calculation. ^[1][2][3]

Chevron in brief

Chevron describes itself as an integrated energy company. It produces crude oil and natural gas and makes transportation fuels, lubricants, petrochemicals and additives. It also develops technology for its own business and the wider industry. The company is based in Houston, Texas, and its common stock trades on the New York Stock Exchange under the ticker CVX. On July 18, 2025 it acquired Hess Corporation, an oil and gas producer whose main upstream operations are in the United States, Guyana and Malaysia, so the second quarter of 2026 is compared below with a first quarter that already included Hess. ^[1][4]

In the release chairman and chief executive officer Mike Wirth credited disciplined investment and strong execution for record US upstream production and record crude throughput at Chevron's US refineries (a paraphrase of his remarks). Chevron also said it had reached $3 billion of annual run rate structural cost cuts since 2024, part of a program that aims for $3 billion to $4 billion by the end of 2026 (a company target, as stated in the release). ^[1]

Four reporting lines and All Other

Chevron reports two segments, Upstream and Downstream, and splits each into the United States and International. Upstream produces oil and other liquids and natural gas. Downstream runs refineries and sells refined products, and US downstream earnings include Chevron's share of its 50% owned affiliate Chevron Phillips Chemical Company. A fifth line, All Other, holds corporate costs and activities such as cash management, debt financing, administration, insurance, real estate and Chevron's technology companies, and it was a net charge in both quarters. ^[1][4]

Chevron explains its segment results against the same quarter a year earlier, not against the first quarter, so the drivers here are year over year. US upstream earnings rose mainly on higher liquids prices and sales volumes, partly offset by higher depreciation, lower natural gas prices and the absence of an asset sale gain from a year earlier. International upstream rose mainly on higher sales volumes, liquids prices and favorable timing effects, partly offset by higher depreciation, depletion and amortization. Both downstream lines gained mainly from higher margins on refined product sales, and international downstream also had an asset sale gain. ^[1]

Against the first quarter, the average Brent crude price Chevron reports rose to $104 a barrel from $81, and its US liquids realization rose to $70.80 a barrel from $51.94. Timing effects, which Chevron says come from marking derivatives to market before the matching oil and gas is delivered and from LIFO inventory accounting, ran in opposite directions in the two quarters. Chevron said first quarter earnings carried about $2.9 billion of unfavorable timing effects and second quarter earnings included $1.4 billion of favorable ones. The third quarter release later gives the second quarter's timing effects as $1,540 million. ^[1][2][3]

Adjusted earnings leave out what Chevron calls special items and foreign currency effects, but not timing effects. In the second quarter that meant adding back $49 million of foreign currency losses and removing a net $144 million of special items: a $230 million asset sale gain in international downstream less $86 million of pension settlement costs. In the quarter Chevron also completed the sale of its Hong Kong downstream fuels and lubricants businesses. In the first quarter Chevron added back a $360 million net loss tied to a legal reserve and $223 million of foreign currency losses. ^[1][2][4]

Production and refining volumes

Net oil equivalent production averaged 4,070 thousand barrels a day in the second quarter against 3,858 thousand in the first. Chevron said US production was a quarterly record. Against a year earlier, it said production was 20% higher, largely because of the legacy Hess assets and growth in the Permian Basin and the Gulf of America, while international output was held back by curtailments in the Partitioned Zone between Saudi Arabia and Kuwait linked to the Middle East conflict. ^[1]

US refineries ran a record 1.07 million barrels a day of crude, with crude unit utilization above 97%, as reported. International refinery inputs and product sales fell. Both were also lower than a year earlier, which Chevron put down to supply disruptions from the Middle East conflict and, for sales, weaker demand for gasoline and diesel. ^[1]

The numbers, quarter over quarter

Sales and other operating revenues were $67,199 million in the second quarter against $47,556 million in the first. Chevron does not report gross profit or an operating income line, so this article uses the lines it does report. Income before income tax expense rose to $16,684 million from $3,946 million, and net income attributable to Chevron rose to $12,072 million from $2,210 million. ^[1][2][4]

Profit margin is earnings as a share of sales. On GAAP earnings it was 18.0% in the second quarter against 4.6% in the first, and on adjusted earnings it was 17.8% against 5.9% (Dalsna Finance calculation: for example $12,072 million divided by $67,199 million). Income tax expense took 26.8% of pretax income in the second quarter and 41.9% in the first (Dalsna Finance calculation: income tax expense divided by income before income tax expense). ^[1][2]

Against the second quarter of 2025, GAAP earnings were nearly five times the $2,490 million of a year earlier and sales rose 51.4% from $44,375 million (Dalsna Finance calculation). ^[1]

Cash flow and the balance sheet

Cash flow from operations was $22,633 million in the second quarter. Chevron said it was higher than a year earlier because of record US production at higher prices, larger cash distributions from Tengizchevroil and favorable working capital. Free cash flow, a non GAAP measure Chevron defines as operating cash flow less capital expenditures, was $18,095 million after $4,538 million of capital spending. ^[1]

The cash flow statement shows $3,504 million paid in common stock dividends and $3,117 million paid for shares repurchased in the quarter, as reported. A footnote in the release says the 2026 repurchase payments include $114 million of excise tax paid on prior year repurchases. Chevron said it cut total debt by a record $8.4 billion in the quarter, and total debt stood at $37,075 million at June 30, 2026 against $40,758 million at the end of 2025. The board declared a dividend of $1.78 per share, payable on September 10, 2026. ^[1][4]

Earnings per share

Earnings per share, or EPS, is profit divided by the number of shares. The diluted figure also counts shares that could be created from stock awards. Chevron reported diluted EPS of $6.11 for the second quarter and $1.11 for the first, and adjusted EPS of $6.06 and $1.41. Adjusted EPS uses adjusted earnings in place of GAAP earnings. Dividing each earnings figure by the weighted average diluted share count gives the same figures. ^[1][2]

The valuation below uses one share count throughout: the 1,975,771,274 shares of common stock the cover of the second quarter report lists as outstanding on June 30, 2026. The release gives a lower figure for the same date, 1,962 million, because it leaves out 14 million shares associated with Chevron's Benefit Plan Trust. ^[4][1]

What the market values Chevron at

Market capitalization, or market cap, is what the stock market values the whole company at: the share price times the number of shares. Chevron shares closed at $235.52 on Friday, October 30, 2026, as reported by StockAnalysis. Times the 1,975,771,274 cover shares, that gives a market cap of about $465.3 billion (Dalsna Finance calculation). Because this article looks back at the second quarter, the price is from the latest close before writing, not from July. ^[5][4]

Six valuation multiples

The price to earnings ratio, or P/E, is market cap divided by a year of earnings. It shows how many dollars the market is paying for each dollar of yearly profit. Annualised means one quarter multiplied by four. On GAAP earnings of $12,072 million times 4, or $48,288 million, the annualised P/E is 9.6. On adjusted earnings of $11,977 million times 4, or $47,908 million, the adjusted annualised P/E is 9.7 (Dalsna Finance calculation). ^[1][5][4]

A forward P/E uses a published estimate of future earnings. We did not find a dated full year 2026 earnings estimate, made after the second quarter results, that we could open and check against its source, so this article shows no forward P/E or adjusted forward P/E rather than use an unverified number. ^[1]

A trailing P/E, sometimes called a historical P/E, uses the last four reported quarters. GAAP earnings over the four quarters to June 30, 2026 add up to $20,591 million and adjusted earnings to $21,425 million, giving a trailing P/E of 22.6 and an adjusted trailing P/E of 21.7 (Dalsna Finance calculation). Both sit well above the annualised multiples because each of the three earlier quarters had GAAP earnings of $2.2 billion to $3.5 billion, a fraction of the second quarter. ^{[1][2][3][5][4]}

The last four quarters

Every figure here is as reported by Chevron in one of its earnings releases. The third quarter 2025 figures come from the comparison column of the third quarter 2026 release, and the fourth quarter 2025 figures from the first quarter 2026 release. The second quarter of 2026 carried more than half of the four quarters' GAAP earnings (Dalsna Finance calculation: $12,072 million of $20,591 million). ^[3][2][1]

Two base cases: the second quarter held flat for a year

Suppose sales stayed at the second quarter's level for a full year, with no growth and no decline: $67,199 million times 4, or $268,796 million. The first base case keeps the 18.0% GAAP profit margin, which gives earnings of $48,288 million, or $24.44 per share on the cover share count. This case is simply the latest quarter annualised, so at the annualised P/E it returns the October 30, 2026 close of $235.52 by construction. The other cells only show how the price moves when the same earnings are given a different multiple. ^[1][5][4]

The second base case uses the 17.8% adjusted margin, which leaves out the $230 million asset sale gain, the pension costs and the foreign currency effects in the same way Chevron's adjusted earnings do: $47,908 million a year, or $24.25 per share. At the adjusted annualised P/E it also returns $235.52 by construction. Both cases still include the favorable timing effects, because Chevron's adjusted earnings do. Chevron reports no operating income line, so there is no operating margin case, and we make no adjustment of our own. ^[1][4][5]

No CEO scenario follows. Chevron's second quarter release gave no revenue figure for a future year, so there is no management revenue figure to put on the grid. ^[1]

Sector comparison

This table sets the second quarter at Chevron beside seven other large US oil and gas companies, using each company's own reported figures for the three months ended June 30, 2026, though integrated companies, producers and refiners earn money in different ways, so margins are not like for like. Each P/E here divides the October 30, 2026 close by four times the quarter's diluted EPS, so it can differ a little from the market cap based P/E earlier in this article. ^[1][5]

What came next

Chevron released its third quarter results on October 30, 2026, and they are covered in a separate Dalsna Finance article. Before that, on October 6, 2026, Chevron said it would divest its interests in Hess Midstream LP and its DJ Basin crude oil midstream assets. Its preliminary assessment is that closing would mean deconsolidating Hess Midstream and booking a one time after tax loss of about $3 billion to $4 billion, which it expects to treat as a special item. The deal is subject to customary closing conditions and regulatory approvals, and closing is expected by the end of 2026 (company estimate and expectation, as stated in the filing). This article uses no third quarter figures beyond the third quarter 2025 comparison above. ^[3][24]

One legal matter in the quarterly report: in April 2025 a Louisiana state court jury awarded Plaquemines Parish $744.6 million against Chevron entities in a coastal erosion case, and Chevron had recorded an accrual of $131 million, which it calls a reasonably estimable loss. In April 2026 the US Supreme Court sent the matter back for further proceedings after finding it related to actions taken under federal direction. Chevron says it believes the verdict is not legally or factually supported and that the verdict remains subject to further proceedings. ^[4]

How these figures were made: inputs come from Chevron's earnings releases for the first, second and third quarters of 2026 and from its second quarter report on SEC EDGAR. The share price is the dated close named above. Calculations use unrounded inputs and are rounded only at the end, with multiples to one decimal, per share figures and prices to the cent and dollar amounts in millions. ^{[2][1][3][4][5]}