YPF (YPF) Q3 2025 earnings summary

Executive summary

• Delivered strong operational performance with a 12% year-over-year revenue decline, but maintained profitability and efficiency, especially in shale operations, with adjusted EBITDA up 21% quarter-over-quarter to $1,357M.

• Shale oil production increased 35% year-over-year, reaching 170,000 barrels per day in Q3 and 190,000 barrels per day in October, surpassing annual targets.

• Downstream segment achieved record refinery processing levels since 2009, with La Plata Refinery recognized as Latin America's best.

• Free cash flow was negative $759M, mainly due to the $523M acquisition of shale assets from Total Austral and mature field exit costs.

• Net result was a loss of $198M, mainly due to higher non-cash deferred income tax and financial losses, with net debt rising to $9.6B and a net leverage ratio of 2.1x.

Financial highlights

• Revenues were $4.6B, down 12% year-over-year, reflecting lower Brent prices, but flat sequentially as higher fuel demand and natural gas sales offset lower prices.

• Adjusted EBITDA was $1.4B, up 21% sequentially and flat year-over-year, driven by shale oil growth and cost reductions.

• Free cash flow was negative $759M, mainly due to M&A and mature field exit costs.

• Cash and short-term investments stood at $1B at quarter-end.

• CAPEX was $1,017M, with 70% allocated to unconventional (Vaca Muerta) assets.

Outlook and guidance

• Shale oil production expected to average 165,000 barrels per day for 2025, with a December 2025 exit rate above 190,000 barrels per day.

• Production guidance for 2026 and 2027: 215,000 and 290,000 barrels per day, respectively.

• Continued focus on unconventional asset development, especially Vaca Muerta, with 94% of upstream CAPEX allocated to shale.

• Ongoing progress on major projects: VMOS oil pipeline (35% complete), Argentina LNG (Phase 3 FID signed), and refinery upgrades.

• Expectation of normalization in local fuel prices and working capital in Q4 as market volatility subsides.