BP Surpasses Q2 Profit Forecast as CEO Commits to Investor Gains

BP has reported a second-quarter profit that exceeds analyst expectations, despite a decline in earnings compared to the previous year. The UK-based energy giant announced an underlying replacement cost profit of $2.4 billion for the second quarter of 2025, down from $2.76 billion in 2024. This figure, however, surpassed the analyst consensus estimate of $1.82 billion. Chief Executive Officer Murray Auchincloss emphasized the company’s commitment to enhancing value for its investors.

The increase in profits compared to the first quarter of 2025 reflects several positive factors. BP attributed the $1 billion rise in underlying replacement cost profit to favorable conditions in gas marketing and trading, improved refining margins, and stronger performance in its customer division. Additionally, robust oil trading results contributed to this performance, though these gains were partially offset by lower liquid and gas realizations and a heightened level of refinery turnaround activity.

Dividend and Share Buyback Announced

In conjunction with its earnings report, BP declared a dividend of 8.32 cents per ordinary share, marking a 4% increase. The company also announced a $750 million share buyback for the second quarter, reflecting its ongoing commitment to returning value to shareholders.

BP is actively addressing operational efficiencies and cost structures, particularly in light of pressures from activist investor Elliott Management, which holds a 5% stake in the company. The firm is pushing for greater cost savings, prompting BP to set a target of $4 billion–$5 billion in structural cost reductions by the end of 2027, based on a 2023 baseline.

In the first half of 2025, BP reported achieving structural cost reductions of $900 million and has cut a total of $1.7 billion in costs relative to the 2023 baseline. Auchincloss expressed confidence in the company’s trajectory, stating, “We are two quarters into a twelve-quarter plan and are laser-focused on delivery of our four key targets.”

Strategic Review Underway

In addition to cost management, Auchincloss and BP’s chair elect, Albert Manifold, announced a comprehensive review of the company’s business portfolio. This initiative aims to ensure BP is positioned as a leader in its industry, prioritizing safety while striving for operational excellence.

“We are also initiating a further cost review and, whilst we will not compromise on safety, we are doing this with a view to being best in class in our industry,” Auchincloss stated. He reiterated BP’s commitment, asserting, “BP can and will do better for its investors.”

The company’s latest performance underscores a proactive approach to enhancing profitability while responding to investor expectations and market dynamics. With strategic moves including increased dividends and share buybacks, alongside rigorous cost management, BP aims to solidify its standing as a key player in the energy sector.