Coterra Energy Inc Q3 2025 Earnings Call Summary

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

Question: Betty Jiang - Barclays Services Corp - Analyst : I want to ask about the cash return strategy just because we would agree that the stock -- it does look discounted in our view as well. Shane last quarter, you talked about really focusing on debt reduction. And then this quarter, Coterra is starting the buyback program again. How do you think about the allocation of your excess free cash flow between debt reduction and buyback going forward? Is there a reason not to think we can get back to that 100% return level into next year? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 04, 2025 / 3:00PM, CTRA.N - Q3 2025 Coterra Energy Inc Earnings Call

Question: Betty Jiang - Barclays Services Corp - Analyst : That's great. And my follow-up is on the overall activity in the Permian. If we look at the Delaware versus your initial expectations, production is -- guidance is unchanged, while you are now completing wells toward the upper end of the guidance range. I'm just wondering, relative to your internal expectations, how is the production profile on the well tracked versus your initial guide. And with activity now towards the high end, does that change your views on how the shape of 2026 shake out?

Question: Arun Jayaram - JPMorgan Chase & Co - Analyst : I wanted to see if you could provide any kind of overall commentary on your thoughts on CapEx reduction next year. You mentioned that you think you're done moderately, but maybe help us fill in the pieces of the drivers of that perhaps relative to your soft guide of delivering 5% year over year oil growth.

Question: Arun Jayaram - JPMorgan Chase & Co - Analyst : Got it. And then maybe my follow-up, you highlighted some parts of the Franklin Avant acquisitions that closed in 1Q, maybe exceeding your expectations. Can you talk about some of the things that you're seeing post your review of those acquisition economics and maybe a little bit more insights on the ground game that you've done, I think you're investing about $86 million in leasehold, which is driving a little bit more of an inventory improvement there.

Question: Neil Mehta - Goldman Sachs Group Inc - Analyst : A couple of gas questions here, Tom. But first, just to expand on your initial comments. I guess one of the questions we get from investors, even beyond the letter this morning is what's the value of operating as a multi-basin portfolio versus being a pure play? And so just maybe you could spend some time now that's been a couple of years, you've had (inaudible) under your portfolio. What are some examples of the tangible upsides or synergies that you get from diversification. Obviously, the commodity is one of it -- but one of them, but I'm sure there's others.

Question: Neil Mehta - Goldman Sachs Group Inc - Analyst : And then the follow-up is just on scale. I mean I think in the Permian, Franklin Mountain continued to give you the scale that you need to be competitive against the largest players in places like the Permian. In the Marcellus, we've seen a lot of consolidation here. Do you feel like you have sufficient scale to be first quartile in the Northeast? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 04, 2025 / 3:00PM, CTRA.N - Q3 2025 Coterra Energy Inc Earnings Call

Question: Scott Gruber - Citibank Cameroon SA - Analyst : I want to come back to your active ground game here. Can you talk about your thoughts around running room to block up your positions in Lea County (inaudible) and the timing of doing so in the competitive market? And just how important is that in terms of compressing your cost structure in the Northern Delaware down towards Culberson? Or do you think you have kind of a good running room to further compress costs on your current acreage position?

Question: Scott Gruber - Citibank Cameroon SA - Analyst : And what is your color on the '26 budget reflects the trend in well cost in the Northern Delaware as you get more experience on the acreage and expand the position. Does that continue to step down? Would that be incremental benefit to the spend in '26? And does the well mix in the Delaware is they're probably the same in '26 kind of as you see it today?

Question: David Deckelbaum - Cowen and Company LLC - Analyst : I wanted to ask perhaps for a little bit more color. It's just on the '26 high-level guide of spending kind of sub $2.3 billion. How do you sort of large projects impact that going into next year? Or as we think about this, is it being driven more by reallocation between basins or the inclusion of more Wolfcamp relative to what we saw in '25? Could you add a little bit more color there just on what's contributing to that trajectory the most? Or is it just general optimization?

Question: David Deckelbaum - Cowen and Company LLC - Analyst : I appreciate that color, Tom. And maybe just following up a bit on just the cadence of the program into the '26. You talked about sort of this 5% oil growth next year. And maybe, Michael, this one is for you. But the -- can you just kind of refresh us on how you kind of see the shape of the Delaware progressing throughout the year after some pretty aggressive growth that we've seen in the back half of '25. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 04, 2025 / 3:00PM, CTRA.N - Q3 2025 Coterra Energy Inc Earnings Call

Question: Derrick Whitfield - Texas Capital - Analyst : With respect to the shareholder letter, Tom, I'd like to go a different direction with it and ask for your perspective on how your PVIs compare across the basins while we all have inverse incremental assessments, (inaudible) quality and look back assessments are less accurate than yours, particularly on a leading edge basis. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. NOVEMBER 04, 2025 / 3:00PM, CTRA.N - Q3 2025 Coterra Energy Inc Earnings Call

Question: Derrick Whitfield - Texas Capital - Analyst : Great. And then maybe for my follow-up, I wanted to focus on gas marketing in the Permian. In light of all the recent pipeline announcements that have achieved FID and the flurry of power announcements we're seeing, how are you guys thinking about managing your Waha exposure? And could this amount of incremental egress lead to favorable in-basin exposure if oil prices remain depressed?

Question: Phillip Jungwirth - Bank of Montreal - Analyst : I wanted to come back to some of the major projects in Culberson County this year, the Barba-Row, Phase 1 and the (inaudible) see if you had any updates or takeaways as far as cost efficiencies, early time productivity, I think Barba-Row is expecting second half wells online. And I know it's early that (inaudible) starting up in the fourth quarter.

Question: Phillip Jungwirth - Bank of Montreal - Analyst : Okay. Great. And then we always think of Coterra as kind of cutting edge willing to implement new technologies. Curious if you've looked at lightweight proppant, is this something you'd consider implementing within your (inaudible) development? I understand you won't be producing this in your refineries, but using it more -- buying it more through third parties.