Austin, Texas — British oil giant Shell reported better-than-anticipated profits for the first quarter of 2025, despite a significant decline in earnings compared to the same period last year. The company achieved adjusted earnings of $5.58 billion, surpassing analyst predictions of $5.09 billion. This figure also exceeded an internal forecast, which had estimated profits at $4.96 billion.
However, earnings for the first quarter fell by approximately 28% from the $7.73 billion reported in the same quarter of 2024. This drop reflects broader trends in the oil industry as demand has weakened and crude prices remain volatile. In the final quarter of 2024, Shell’s earnings stood at $3.66 billion, indicating fluctuating performance across recent months.
Following the announcement, Shell’s stock experienced a nearly 3% rise in early trading, a reaction reflecting investor confidence amid ongoing concerns regarding industry profitability. The oil sector has faced heightened scrutiny, particularly with investor returns receiving considerable attention as profits have dipped from record highs achieved in 2022.
In response to these challenges, Shell announced a new $3.5 billion share buyback initiative, continuing its commitment to returning capital to shareholders. This marks the 14th consecutive quarter in which the company has executed buybacks of at least $3 billion. This strategic move aims to bolster investor sentiment, unlike its rival BP, which recently scaled back its own share buyback program after reporting disappointing profits.
Shell’s CEO, Wael Sawan, characterized the company’s financial results as “another solid set of results.” He expressed confidence in the firm’s performance and resilience, which enabled the continuation of the buyback program. Sawan reiterated the company’s strategic direction, which emphasizes increasing shareholder returns while managing expenditures.
In line with its financial maneuvers, Shell also maintained its annual investment budget at a range of $20 billion to $22 billion for 2025. The company has indicated a strategic shift toward a focus on liquefied natural gas (LNG), complementing its commitment to enhancing shareholder value.
As energy markets continue to adjust amid geopolitical uncertainties and fluctuations in global demand, Shell’s strategic decisions will be closely watched by investors and industry analysts alike. The company’s ability to navigate these challenges while maintaining profitability could serve as a barometer for the broader oil sector in the coming months.