Shell Falls Short of Profit Estimates
February 5, 2026
Shell missed fourth-quarter profit expectations on Thursday with an 11% drop to the lowest level since early 2021 amid weaker oil prices, but kept its share buyback programme steady at $3.5 billion for the next three months.
Profits at its integrated gas and marketing divisions came in below expectations, while a loss in its chemicals and products unit - hit by weak oil trading that Shell had already flagged - was deeper than analysts expected.
The stock was down about 2% in early trading.
Fourth-quarter net profit came in at $3.3 billion, below analysts' average estimate of $3.5 billion in a company-provided poll for adjusted earnings, Shell’s definition of net profit.
Shareholder Payouts
The $3.5 billion buyback pace, together with $2.1 billion in dividends, lifts shareholder payouts over the last four quarters to 52% of operating cash flow, above Shell's 40% to 50% target range. Asked about this, Chief Financial Officer Sinead Gorman told reporters the rolling 12-month range was "sacrosanct".
By the end of 2025, Shell had bought back more than a quarter of its shares in four years.
Shell increased its quarterly dividend by 4% to $0.372 per share.
The world’s largest liquefied natural gas trader reported fourth-quarter cash flow from operations of $9.44 billion, ahead of expectations for $7.87 billion but down from $13.16 billion a year earlier.
RBC analysts noted that Shell's reserve life had fallen to 7.8 years, from 8.9 years in 2024. "Given this is weaker than some peers, we anticipate this could fuel more questions around Shell's M&A reserve replacement strategy," they said.
Brent futures LCOc1 averaged around $63 per barrel in the quarter, down from about $74 a year earlier, according to LSEG data and Reuters calculations.
The benchmark Dutch front-month gas contract at the TTF hub TRNLTTFMc1 averaged about 30 euros per megawatt-hour in the quarter, down from around 43.3 euros a year earlier.
(Reuters - Reporting by Shadia Nasralla and Stephanie Kelly. Editing by Bernadette Baum and Mark Potter)
