Chevron reported Q4 earnings on January 30 that topped analyst expectations, even as crude prices delivered the steepest yearly decline in half a decade.
More importantly for income investors, Chevron (CVX) announced it’s raising its quarterly dividend 4% to $1.78 per share.
That marks another chapter in the company’s unmatched track record of dividend growth spanning multiple decades.
Shares of the 147-year-old oil and gas giant jumped over 3% on the news.
Chevron posted adjusted earnings of $1.52 per share for the quarter, beating the Street’s consensus estimate of $1.45.
Revenue came in at $46.87 billion, down 10% from last year’s $52.23 billion, but the earnings beat is what mattered.
The company’s net income fell more than 14% to $2.77 billion, or $1.39 per share, compared with $3.24 billion a year earlier.
Lower oil prices squeezed margins, but Chevron offset the pressure by pumping more barrels than ever before.
Chevron CEO is bullish on long-term growth
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Record production offsets price pressure
In 2025, Chevronincreased production by 12% globally and by 16% in the U.S., showcasing that operational excellence can overcome commodity price volatility.
- In Q4, Chevronpumped 4.05 million barrels per day, an increase of roughly 21% compared with 3.35 million bpd in the fourth quarter of 2024.
- Production growth was driven by strategic investments across multiple high-margin assets, including major project milestones at Tengiz and continued strength in the Permian Basin.
CEO Mike Wirth highlighted the company’s execution during the earnings call. Wirth said,
The results show Chevron can grow cash flow even when oil prices decline. Excluding asset sales, adjusted free cash flow surged over 35% year-over-year, despite oil prices dropping nearly 15%.
Venezuela could be a game-changer for CVX stock
The biggest headline from Chevron’s earnings might not be the numbers themselves, but rather what’s coming next from Venezuela.
Chevron is the only U.S. oil major operating in Venezuela under a special Treasury Department license.
Related: Venezuela oil debate reveals big mystery
Following recent U.S. military intervention that removed President Nicolás Maduro and effectively seized control of the country’s oil industry, Chevron announced it can ramp up production there by 50% over the next 18 to 24 months.
“We have been a part of Venezuela’s past for more than a century. We remain committed to its present. And we stand ready to help it build a better future while strengthening U.S. energy and regional security,” Wirth said.
- Chevron has grown Venezuelan production by over 200,000 barrels per day since 2022 through a venture-funded model designed to recover outstanding debt.
- Current gross production sits around 250,000 barrels per day.
- A 50% increase would add meaningful volumes to Chevron’s already impressive output.
- The company is also bringing roughly 50,000 barrels per day of Venezuelan crude into its Pascagoula, Mississippi refinery, with capacity to process another 100,000 barrels per day across its system.
Wall Street views Chevron as best positioned to benefit from Venezuela’s changing landscape. Competitors like ExxonMobil remain hesitant due to the country’s history of seizing international oil companies’ assets.
Upstream delivers despite headwinds
According to this CNBC report:
- Chevron’s U.S. production business earned $1.26 billion in the quarter, down about 11% from $1.42 billion a year earlier as lower prices took their toll.
- International production posted a profit of $1.78 billion, down 38% from $2.88 billion in the prior-year period.
- But the downstream business showed real strength. U.S. refining swung to a $230 million profit after posting a $348 million loss in the year-ago quarter.
- International refining earned $593 million, nearly 500% higher than the $100 million posted a year earlier.
The company delivered the highest U.S. refinery throughput in two decades, reflecting recent expansion projects and improved efficiency.
Chevron’s focus on cost cuts
CFO Eimear Bonner emphasized that the company’s structural cost reduction program is exceeding expectations. Chevron delivered $1.5 billion in savings during 2025 with a $2 billion annual run rate captured by year-end.
“We’ve restructured our operating model to be leaner and faster with a more intense focus on benchmarking and prioritization,” Bonner said during the earnings call.
The company now targets$3 billion to $4 billion in cost reductions by the end of 2026, with over 60% coming from durable efficiency gains rather than one-time cuts.
Chevron is applying technology and scale advantages across its newly consolidated shale and tight portfolio, which includes the Permian, DJ Basin, Bakken, and Argentina.
The company held Permian production above 1 million barrels per day for three consecutive quarters while reducing capital spending to $3.5 billion.
Chevron’s dividend payout is poised for growth
For the fourth consecutive year, Chevron returned record cash to shareholders. The company repurchased$3 billion in shares during the fourth quarter at the high end of its guidance range.
Combined with the Hess acquisition that closed during the year, Chevron acquired over $14 billion in shares at what management considers a discount.
The 4% dividend increase underscores management’s confidence in the business. Chevron’s track record of dividend growth is unmatched across decades, a point Bonner emphasized on the call.
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According to Fiscal.ai data, Chevron has raised the annual dividend from $1 in 1996 to $6.84 in 2026.
Analyst estimates from Tikr.com forecast Chevron to increase (between 2026 and 2030):
- Free cash flow from $20.65 billion to $28 billion.
- Annual dividend per share from $7.10 to $8.65.
During this period, the dividend payout ratio should improve from 69% to 62%, providing the blue-chip giant with the flexibility to pursue acquisitions and reduce balance sheet debt.
Notably, Chevron’s balance sheet remains in excellent shape with a net debt coverage ratio of 1x, enabling the dividend giant to navigate commodity price cycles while continuing to reward shareholders.
Chevron’s current dividend payout translates to a yield of 4%. Given consensus price targets, Chevron stock trades at a 5% discount in January 2026.
Related: Chevron, oil execs send strong message on Venezuela
