Expand Energy Corp Q2 2025 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Scott Hanold - RBC Capital Markets Inc - Analyst : Yes. Good morning, thanks. Yes. A few of your peers have signed gas contracts related to power growth opportunities. Can you talk about Expand's strategy? And what are your goals that you're looking for in a commercial agreement? And how do you think about the pricing mechanism for that? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 30, 2025 / 1:00PM, EXE.OQ - Q2 2025 Expand Energy Corp Earnings Call

Question: Scott Hanold - RBC Capital Markets Inc - Analyst : Yes. And my follow-up question is still going to be on the same line because I think it's important, obviously, for a lot of gas companies, how they structure these deals going forward to maximize the value to the company. But can you talk about like 2 things here additionally? Number one, I alluded to the fact that a lot of your gas peers have done a few deals here. Do you feel there's a need to be -- do you have some urgency in signing deals? And then with respect to, again, the commercial side of the agreement, if I look at, like, say, an LNG opportunity, would you be willing to kind of -- how do you want to structure the deal? Would you be willing to sell it to like an end user overseas or to a middleman? How do you see the best way to optimize that price?

Question: Scott Hanold - RBC Capital Markets Inc - Analyst : Appreciate that. Thank you.

Question: Zach Parham - JPMorgan Chase & Co - Analyst : Thanks. You highlighted some significant increases in footage drilled per day over the last six months. Could you give us a little more detail on what's driven those increases? Maybe talk about where you could see those numbers going over the next few quarters? Do you see the ability to continue to increase that footage per day number going forward?

Question: Zach Parham - JPMorgan Chase & Co - Analyst : Thanks, Josh. My follow-up, in the slide deck, you provided an update on Haynesville well productivity that I think clears up some things on the state data. It also looks like you've seen better -- a little bit better productivity year-over-year in 2025. Anything specific you'd highlight that's driving that increase? Do you expect that to continue going forward?

Question: Zach Parham - JPMorgan Chase & Co - Analyst : Thank you.

Question: John Freeman - Raymond James - Analyst : Thank you. Good morning. The first question, just kind of following up on Zach's question on the footage drilled. Obviously, pretty remarkable improvements in the footage drilled per day across the portfolio, even just from the first quarter. And I'm just trying to get a sense of what's currently baked into your full year guidance. Does that reflect those kind of leading edge 2Q cycle times?

Question: John Freeman - Raymond James - Analyst : Okay. And then just the follow-up question I've got. When I look to kind of revisit that heat map table that you have got on optimizing free cash flow at various gas prices and we look at sort of the meaningful improvement you all have now got on the free cash flow, REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 30, 2025 / 1:00PM, EXE.OQ - Q2 2025 Expand Energy Corp Earnings Call especially starting next year, both on the lower cost and then the tax and interest savings. And in the response to Doug's question, it does sound like this has got some legs in terms of that uplift on the tax side. I guess I'm surprised that the kind of the coloring of that chart like hasn't changed at all since the start of the year. And I guess I'm just trying to get a sense for if that includes sort of the uplift, especially on the tax side? And if it does, just what would potentially have to change for that chart to kind of shift at least in terms of that relationship? Like what would change that would cause a 350 mid-cycle price to point to you all producing something above 7.5 Bs or just -- I'm trying to get a sense of what would maybe cause that chart to shift, if anything?

Question: John Freeman - Raymond James - Analyst : So even though the -- it looks like the cash flow uplift is not like linear in terms of on the tax side, it doesn't necessarily have any change to this chart.

Question: John Freeman - Raymond James - Analyst : Appreciate it. Thanks, guys.

Question: Devin McDermott - Morgan Stanley - Analyst : Hey, good morning. Thanks for taking my question. So I wanted to ask kind of along a similar lines on capital allocation and optimizing for free cash flow with some of the weakness in Henry Hub over the last month or two, we're now back below -- at least on the prime contract below your mid-cycle price range. So question is more on kind of duration of price. At what point do you start to toggle things or move around within this heat map? What are you looking for as we head into 2026 to kind of reaffirm the constructive view in that 7.5 Bcf a day target you all have on production for next year?

Question: Devin McDermott - Morgan Stanley - Analyst : Okay. Great. Makes a lot of sense. And then I wanted to come back to the Haynesville and well productivity, I know there's a question on that before. But -- your results are strong. The state data also shows the degradation across other producers in the basin. So I guess my question is more broadly I guess, is the reporting issue unique to expand? Is it broad across the basin? And what's your views on kind of marginal cost breakeven, Haynesville growth capacity as we kind of head into this tightening market over the next few years in that backdrop?

Question: Devin McDermott - Morgan Stanley - Analyst : Makes a lot of sense. Thanks for all the details.

Question: Josh Silverstein - UBS AG - Analyst : Good morning guys. Do you think it was challenging from a basis standpoint in both the Haynesville and Appalachia. Can you just give us an update on expectations for second half and maybe going into 2026. I know there's been some start-up of infrastructure in the Haynesville, so how that may impact some of your capital allocation thoughts later on this year and into next year? Thanks.

Question: Josh Silverstein - UBS AG - Analyst : And then I want to see if I can also get kind of your views on Lower 48 production in total. We've seen a real big step up recently kind of into that 108-109 area. Is the expectations that we maybe stay around here, do we come down or just given some of the rig count increases that we've seen in the Haynesville, there is still expectations of growth going forward into 2026?

Question: Josh Silverstein - UBS AG - Analyst : Okay. Thank you.

Question: Neil Mehta - Goldman Sachs Group Inc - Analyst : Yes. Good morning, Nick and Mohit and team. I just want to start on Slide 6, the merger synergies. There's another $100 million here of outperformance. And I think you got four bullets that describes some of the pieces there. But could you unpack it, whether it's sand mine stuff or some of the things that you're doing in the Haynesville to help us get some color of what's happening on the ground?

Question: Neil Mehta - Goldman Sachs Group Inc - Analyst : Thank you. And the follow-up is just around hedging strategy. You guys were aggressive in Q1 and -- for locking in '26 and almost at 40% now, and that has kind of aged well. But your perspective as the curve has come off as hard as it has for '26. How do you think about being opportunistic versus ratable in the hedge the wedge strategy?

Question: Neil Mehta - Goldman Sachs Group Inc - Analyst : Mohit, can I ask one quick follow-up on that, which is the '26 curve has come down, it feels like, in large part of a reflection of production, which is probably running to [period of] higher than most forecasters would have thought. Do you feel like that is structural in the sense that it could shift the way that we should be thinking about the '26 curve or is it just some of this production, which is deferred TILs just coming back at which point we should be less worried about the way that the '26 curve is moving? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 30, 2025 / 1:00PM, EXE.OQ - Q2 2025 Expand Energy Corp Earnings Call

Question: Neil Mehta - Goldman Sachs Group Inc - Analyst : Alright, thanks man.

Question: Kevin MacCurdy - Pickering Energy Partners - Analyst : Hey, good morning. There's some reports out there of assets being marketed in the basins you operate in. And do you feel like your balance sheet and organization are in a spot where you would consider more M&A? And is there any differentiation you see between M&A potential in the Haynesville versus Marcellus?

Question: Kevin MacCurdy - Pickering Energy Partners - Analyst : I appreciate that answer. And as a follow-up, your guidance includes productive capacity of up to $275 million CapEx this year. Your wording, while I know it's not changed, it seems to leave a little bit of optionality on not spending the full amount. You said earlier in the call that you're not concerned about the long-term macro. But is there anything in the near-term gas markets that would lead you to maybe pull back on that productive spending? And when would you need to make that decision? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 30, 2025 / 1:00PM, EXE.OQ - Q2 2025 Expand Energy Corp Earnings Call

Question: Kevin MacCurdy - Pickering Energy Partners - Analyst : Great thanks Nick. Thank you.

Question: Phillips Johnston - Capital One Securities Inc - Analyst : Hey, thanks for the time. I also wanted to ask about M&A. I heard what you said, Nick, in terms of you guys are satisfied with what you have. But looking out over the next few years-or-so, I wanted to get a sense of whether or not you guys would consider Canada as an area to expand your footprint? Or would the AECO discount or any other factor would be something that could generally sort of rule that out?

Question: Phillips Johnston - Capital One Securities Inc - Analyst : Okay. And I think the last time you all provided D&C well cost by area within your February presentation. At these new faster drilling speeds, can you just give us a general sense of how much your well costs have fallen in all three areas, I guess, relative to the figures that you guys provided back in February?

Question: Phillips Johnston - Capital One Securities Inc - Analyst : Sounds good. Thanks guys.

Question: Paul Diamond - Citi Infrastructure Investments LLC - Analyst : Just a quick question on kind of the larger portfolio dynamics. I guess from a longer-term perspective, how do you think about the right balance between LNG contracts, data center contracts and then just general delivery otherwise?

Question: Paul Diamond - Citi Infrastructure Investments LLC - Analyst : Understood. Makes perfect sense. Just a quick bookkeeping follow-up. Circling back to Slide 25 and Haynesville productivity. I know you said that they're working with local state agencies in Louisiana, but do you guys have any line of sight on the timing of when that data should be captured accurately? And is it a permanent fix or could this happen again? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. JULY 30, 2025 / 1:00PM, EXE.OQ - Q2 2025 Expand Energy Corp Earnings Call

Question: Paul Diamond - Citi Infrastructure Investments LLC - Analyst : Understood. It's a target. Thank you so much.