London, Feb 5, 2026, 12:25 GMT — Regular session.
- Shares of Shell dropped in London following the company’s failure to meet fourth-quarter profit forecasts.
- The company maintained its quarterly buyback pace and boosted its dividend, continuing its streak of hefty cash returns.
- Traders are focused on oil and gas prices alongside the sluggish chemicals cycle for hints on how long payouts might last.
Shares of Shell plc slipped roughly 1% on Thursday following the company’s quarterly profit that fell short of expectations amid a cooling price backdrop. (Reuters)
The miss matters because investors are now doubting if Big Oil can maintain “bumper” buybacks as crude and gas prices slide and supply expands. For European companies, payout reductions would surface in dividend plans well before production cuts become evident.
Shell has relied heavily on cash returns to support its stock. That strategy paid off in recent years. Investors still focus on this first whenever earnings falter.
Shell reported fourth-quarter adjusted earnings—its version of net profit—dropped 11% to $3.3 billion, missing the company-supplied analyst estimate of $3.5 billion and marking the weakest quarterly result since early 2021. The firm kept its share buyback steady at $3.5 billion and lifted the dividend 4% to $0.372 per share. Dividends paid over the past year totaled $2.1 billion, equal to 52% of operating cash flow, edging above its 40%-50% target band. CFO Sinead Gorman insisted the rolling 12-month payout ratio remains “sacrosanct.” Meanwhile, RBC analysts pointed to a shorter “reserve life” at current production rates, suggesting this could spark added scrutiny over Shell’s M&A approach to replacing reserves. (Reuters)
Shell reported $26 billion in free cash flow for 2025 and has slashed $5.1 billion in structural costs since 2022. Net debt stood near $45.7 billion at year-end. The company expects cash capital spending to hit $20 billion to $22 billion in 2026. CEO Wael Sawan described 2025 as a year of “accelerated momentum,” highlighting the latest dividend increase and the 17th consecutive quarter with buybacks topping $3 billion. (Shell)
Shell laid out details of its new buyback, which is expected to last about three months and, depending on market conditions, finish before the first-quarter 2026 results. The company established two broker-led contracts—one targeting London and the other the Netherlands—each capped at $1.75 billion. It also confirmed that all repurchased shares will be cancelled. (GlobeNewswire)
Shell filed its unaudited condensed financial report for the three and twelve months ending Dec. 31, 2025, in a Form 6-K with the SEC. (SEC)
Risks are baked in. Oil and gas prices have dipped compared to last year, while Shell’s chemicals and products division suffers from a sluggish cycle. Both factors are tightening cash flow, even as the company pushes to maintain steady buybacks.
Investors now turn to the dividend schedule and upcoming cash flow figures. Shell’s ordinary shares go ex-dividend on Feb. 19, while its ADSs follow on Feb. 20, with payments set for March 30. The company’s calendar points to first-quarter 2026 results and the next dividend announcement on May 7. (Shell)
