Antero Resources reported record production and sharply higher earnings and cash flow for the third quarter of 2026, alongside lower operating costs. The natural gas producer also outlined progress on a margin-enhancement program focused on transportation capacity and other portfolio changes, and said it bought back shares during the quarter.
Key results
- Net production averaged more than 4.2 billion cubic feet equivalent per day, a company record and 23% above the year-earlier quarter. CEO Michael Kennedy said production had grown by nearly 1 Bcfe/d over the past 12 months through transactions and efficiency gains.
- Net income was $367 million. Adjusted net income, a non-GAAP measure, was $256 million.
- Adjusted EBITDAX was $634 million, up 99% from the third quarter of 2025.
- Cash provided by operating activities was $575 million. Adjusted free cash flow, a non-GAAP measure, was $215 million, up 137% year over year.
- Total cash operating costs fell to $2.05 per Mcfe from $2.44 a year earlier—a reduction of $0.39 per Mcfe, or 16%—and came in below the low end of the company’s guidance range.
- Antero said its unhedged EBITDAX margin rose 27%, to $1.28 per Mcfe from $1.01. The company said the improvement came despite a 4% decline in NYMEX natural gas prices.
- Antero repurchased 1.6 million shares for about $56 million during the quarter. Kennedy said the company had reduced its share count by more than 5 million shares over the past year while keeping leverage at approximately 1.0 times.
- The company completed a horizontal well lateral of approximately 25,000 feet, its longest on record.
Commercial and margin initiatives
- Antero completed 265 million cubic feet per day of premium-priced supply contracts tied to growing demand in the Clarington, Ohio area.
- In the third quarter, it optimized firm transportation arrangements covering about 400 MMcf/d of natural gas. The company said these agreements are expected to add $20 million in annualized free cash flow.
- Antero is targeting optimization of more than 1 billion cubic feet per day of natural gas transportation capacity in 2027. Its broader margin-enhancement program targets $300 million of benefit, with the company expecting to achieve $140 million by mid-2027. The identified components include $50 million from transportation optimization, $60 million from the reversion of an overriding royalty interest and $30 million from the expiration of a volumetric production payment.
- The company said it began executing the margin initiatives during the quarter. Its chief financial officer attributed the lower cash costs and higher unhedged margin to progress in the first year of the program.
What changes for investors
The quarter’s results reflect both higher production and lower per-unit costs, alongside growth in adjusted cash flow. Antero is also pursuing additional value from its transportation portfolio and other arrangements, while continuing share repurchases. The company presented product diversity, a lower cost structure and hedging as parts of a strategy intended to reduce earnings volatility.