Devon Energy's Business Optimization Plan and $1 Billion Free Cash Flow Target
Devon Energy aims to create an incremental $1 billion of annual free cash flow by the end of 2026 through operational efficiencies and cost reductions.
Management highlighted that 40% of their $1 billion target was achieved within the first 4 months of the initiative.
The company is leveraging technology, including AI, to drive production enhancements and operational efficiencies.
Significant progress has been made in reducing capital guidance by 10%, or $400 million, while increasing production outlook.
The plan includes strategic asset sales, such as the Matterhorn Pipeline divestiture, and acquisitions like Cotton Draw Midstream to strengthen financial position.
Management emphasized transparency and accountability in tracking progress toward the free cash flow goal.
Adjusted EBITDA, excluding restructuring and noncash charges, was $16.4 million in Q2 2025 versus $5 million in Q2 2024.
Capital expenditures were $11 million in Q2, with an expected $10 million for the remainder of 2025 excluding fully financed carbon capture equipment.
Depreciation and amortization were $27.6 million, including a $3.1 million impairment related to closure of a noncore feed business.
Green Plains reported a net loss of $72.2 million or $1.09 per share in Q2 2025, compared to a loss of $24.4 million or $0.38 per share in Q2 2024.
Interest expense increased by $6.4 million to $13.9 million due to accounting treatment of warrants and absence of capitalized interest.
Liquidity at quarter end included $152.7 million in cash and equivalents, $258.5 million revolver availability, and $93.3 million unrestricted liquidity.
Revenue for Q2 2025 was $552.8 million, down 10.7% year-over-year due to exiting ethanol marketing for Tharaldson and placing Fairmont ethanol asset on care and maintenance.
SG&A expenses improved by $6.3 million year-over-year to $27.6 million and are on track to exit 2025 at low $40 million run rate for corporate and trade SG&A.
The results included $44.9 million in noncash charges related to sale or impairment of noncore assets and $2.5 million in one-time restructuring charges.
Adjusted EBITDA loss narrowed to $16.4 million from $20.1 million year-over-year.
Adjusted net loss per share improved to $0.95 from $1.74, excluding noncash impairments and restructuring costs.
Backlog grew 4% to $1.24 billion, including $24 million product backlog and $7.7 million service backlog from CGN agreement.
Loss from operations widened to $95.4 million in Q3 2025 from $33.6 million in Q3 2024, driven by $64.5 million noncash impairment and $4.1 million restructuring expenses.
Net loss attributable to common stockholders was $92.5 million, or $3.78 per share, compared to $33.5 million, or $1.99 per share, in the prior year quarter.
Product revenues surged to $26 million from $0.3 million, driven by module deliveries to GGE and Ameresco contracts.
Service agreement revenues increased to $3.1 million from $1.4 million, mainly from GGE long-term service agreement.
Total revenues increased 97% year-over-year to $46.7 million in Q3 2025 from $23.7 million in Q3 2024.
Strategic Pivot to Long-Duration Energy Storage and Market Focus
ESS has shifted its strategic focus towards long-duration energy storage solutions, emphasizing the Energy Base product as a core growth driver.
The company highlighted the limitations of short-duration storage and lithium-ion technologies, positioning itself as a leader in scalable, safe, and sustainable long-duration storage.
Management noted a significant increase in market demand, with proposal activity exceeding 1.1 gigawatt hours since the Energy Base launch in February.
The company’s relationships with Tier 1 customers and utilities are foundational to its long-term growth strategy in the evolving energy transition market.
ESS’s pivot includes a focus on building a commercial pipeline with a growing number of RFPs and strategic partnerships, signaling a shift from project-based to pipeline-based revenue.
The company aims to convert commercial momentum into multiyear agreements, targeting revenue growth starting in 2026.
Dafinchi