Devon beats quarterly profit, forecasts lower output after winter storm

Feb 17 (Reuters) - U.S. shale producer Devon Energy DVN.N on Tuesday narrowly beat Wall Street estimates for fourth-quarter profit and forecast lower first-quarter production after severe winter storms disrupted operations across key producing regions.

The winter storm knocked out as much as 2 million barrels per day of U.S. oil production, roughly 15% of national output, according to analysts and traders' estimates, before volumes began to recover, highlighting the scale of the disruption facing producers such as Devon.

Global crude oil prices have been pressured by growing worries of a glut and the increasing prospect of more Venezuelan barrels returning to the market.

Earlier this month, Devon and rival Coterra Energy CTRA.N announced a $58 billion merger, aimed at bolstering scale and cost efficiency as oil prices weaken.

The merger is expected to close in the second quarter and the companies are targeting $1 billion in annual pre-tax savings by 2027.

Shares of Devon fell 1% after the bell.

PRODUCTION HIT

Devon expects first-quarter production to be between 823,000 barrels of oil equivalent per day (boepd) and 843,000 boepd.

Fourth-quarter production rose to 851,000 boepd, from 848,000 boepd a year earlier.

Including cash settlements, average realized prices were $34.52 per barrel of oil equivalent in the three months ended December 31, compared with $40.32 per barrel of oil equivalent a year earlier.

WTI crude CLc1 fell about 20% in 2025, and declined 8% in the October-December quarter.

Devon said it had already delivered 85% of its $1 billion cost-savings target, and expects to reach the full goal by the end of 2026.

The company posted an adjusted profit of 82 cents per share, compared with the average analyst estimate of 81 cents, according to data compiled by LSEG.