CRGY Filings — Crescent Energy Company - FilingSpy
CRGY
Crescent Energy Company
An independent energy company that explores for and produces crude oil, natural gas, and natural gas liquids across the Eagle Ford, Permian, and Uinta basins in the United States. It was formed in December 2021 when Contango Oil & Gas merged with Independence Energy, the oil-and-gas arm of investment firm KKR. Its Uinta Basin wells in Utah produce a distinctive crude that is piped straight to Salt Lake City refineries.
Crescent Energy's Q2 2026 operating income rose 630% to $581M as the Vital Energy Merger and higher oil prices transformed profitability.
returned to a level that covers the company's costs. rose 55% to $1.4 billion and widened to 42% as oil revenue more than doubled on higher volumes and a 57% rise in realized prices, while per-unit operating costs fell. The merger-driven scale has shifted the business from break-even to generating over $400 million in quarterly , but a $5.2 billion debt load and a large derivative program mean reported will keep swinging.
Key takeaways
rose 630% to $581.0 million, and widened to 41.6% from 13.0% a year ago, as the gain from the Vital Energy Merger and higher oil prices far outpaced a 5% increase in total operating expenses.
rose 55% to $1.4 billion, driven by a 104% increase in oil revenue as production volumes rose 30% and realized oil prices rose 57% to $96.61 per barrel, while natural gas revenue fell 79% on an 81% drop in realized gas prices to $0.52 per Mcf.
Section summaries
Management's Discussion and Analysis
Revenue surged 55% YoY to $1.4B in Q2 2026, driven by the Vital Energy Merger and higher oil prices, while Adjusted EBITDAX rose 55%.
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Total revenues increased 55% to $1.4B, primarily from a 104% jump in oil due to a 30% volume increase and 57% higher realized oil prices ($96.61/Bbl).
General and administrative expense fell by half to $61.5 million, largely because of a $72.1 million decrease in non-cash equity-based compensation tied to Manager PSUs, reversing a cost that had weighed on reported in prior quarters.
more than doubled to $417.7 million, supported by higher , though development increased to $284.1 million.
The derivative portfolio held a net asset fair value of $37.6 million on a $2.6 billion notional position at quarter-end, and a 10% move in commodity prices would shift the position by approximately $179 million, ensuring reported remains volatile.
Liquidity stood at $2.0 billion available under the with no outstanding borrowings, after the company issued $690 million in convertible notes and used the proceeds to redeem higher-cost 9.250% Senior Notes due 2028.
What changed
The Q1 2026 watch item on derivative-driven swings materialized: after a $615.6 million non-cash derivative loss drove a $419.8 million net loss in Q1, the portfolio swung to a $37.6 million net asset position in Q2, and net income rebounded to $492.8 million.
The concern that of $191.8 million in Q1 2026 might not sustain the capital program and was partly resolved: Levered Free Cash Flow more than doubled to $417.7 million in Q2, providing more headroom, though development spending also rose.
The risk that the $690 million convertible notes could dilute shareholders remains live: the filing's new risk factor warns that conversion would dilute equity and that the notes' liability could be reclassified as current, reducing reported .
The company still has not quantified the financial impact of U.S. tariffs on operating costs and , a risk factor carried forward from 2025 that remains unquantified.
What to watch
Whether the 41.6% is sustainable if oil prices retreat from $96.61 per barrel, or whether the cost structure reverts to the single-digit margins seen as recently as Q3 2025.
Whether the $2.6 billion notional derivative position continues to produce the kind of quarter-to-quarter swings seen in Q1 and Q2 2026, and whether management addresses the volatility.
Whether the conversion features of the $690 million 2031 Convertible Notes are triggered, and if so, whether the notes are reclassified as a current liability, reducing reported .
Whether the company quantifies the financial impact of U.S. tariffs on operating costs and , a risk factor that has now gone unquantified for over a year.
Natural gas fell 79% as realized prices dropped 81% to $0.52/Mcf, driven by lower index pricing and wider differentials in the Permian Basin following the Vital Energy Merger.
Total operating expense rose only 5% despite a 27% production increase, with per-unit lease operating and gathering costs declining 10% and 30%, respectively.
General and administrative expense halved to $61.5M, largely due to a $72.1M decrease in equity-based compensation tied to Manager PSUs.
more than doubled to $417.7M, supported by higher , though development increased to $284.1M.
Liquidity was strengthened by a $690M convertible notes issuance used to redeem higher-cost 2028 Notes, with $2.0B available under the and no outstanding borrowings.
Quantitative and Qualitative Disclosures About Market Risk
Commodity price risk is the primary exposure, managed through an active hedging program; interest rate risk is limited to variable-rate borrowings.
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The company’s major market risk is volatile pricing for its oil, natural gas, and NGL production, driven by global supply and demand factors outside its control.
It actively hedges near-term price volatility using contracts such as price swaps and collars, while maintaining long-term commodity price exposure.
As of June 30, 2026, the portfolio had a $2.6 billion and a net asset fair value of $37.6 million.
A hypothetical 10% increase in underlying commodity prices would change the net position by approximately $179.1 million; a 10% decrease would change it by approximately $168.4 million.
Interest rate risk stems from $275.5 million in variable-rate borrowings under the CRF ; a 1% rate change would impact by about $1.0 million over six months.
Credit risk is managed by transacting only with creditworthy financial institutions, using ISDA master agreements that permit netting, and selling fungible commodities to a diverse customer base.
The Company may, from time to time, be involved in litigation and claims arising out of its operations in the normal course of business. We are currently unaware of any proceedings that, in the opinion of management, will individually or in the aggregate have a material adverse…
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The Company may, from time to time, be involved in litigation and claims arising out of its operations in the normal course of business. We are currently unaware of any proceedings that, in the opinion of management, will individually or in the aggregate have a material adverse effect on our financial position, results of operations or cash flows. Additional information required for this Item is provided in Notes to condensed consolidated financial statements, Note 9 – Commitments and Contingencies included in Part I. Item 1. Financial Statements of this Quarterly Report, which is incorporated by reference into this Item.