Finance
Shell misses profit expectations, but keeps buyback pace
Published by Global Banking & Finance Review®
Posted on February 5, 2026
2 min readLast updated: February 5, 2026
Quick Summary
Shell's fourth-quarter profit was $3.26 billion, missing analyst expectations of $3.5 billion and down from $3.7 billion last year.
Shell's Fourth-Quarter Profits Fall Short, Buyback Program Continues
Shell's Financial Performance Overview
By Shadia Nasralla and Stephanie Kelly
Profit and Loss Analysis
LONDON, Feb 5 (Reuters) - 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.
Shareholder Returns
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.
Market Reactions
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 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 averaged about 30 euros per megawatt-hour in the quarter, down from around 43.3 euros a year earlier.
(Reporting by Shadia Nasralla and Stephanie Kelly. Editing by Bernadette Baum and Mark Potter)
Key Takeaways
- •Shell's Q4 profit was $3.26 billion.
- •Analyst expectations were $3.5 billion.
- •Previous year's profit was $3.7 billion.
- •Shell's earnings definition includes adjusted earnings.
- •Reported by Shadia Nasralla and Stephanie Kelly.
Frequently Asked Questions about Shell misses profit expectations, but keeps buyback pace
1What is adjusted earnings?
Adjusted earnings refer to a company's net profit after removing one-time items and expenses, providing a clearer view of ongoing operational performance.
2What is net profit?
Net profit is the amount of money a company has left after all expenses, taxes, and costs have been subtracted from total revenue.
3What is corporate profit?
Corporate profit is the income that a corporation earns after all expenses have been deducted from total revenue, often reported quarterly.
