Key Highlights

  • HighPeak reported second quarter 2026 revenue of $272.4 million and net income of $82.3 million, or $0.59 per diluted share.
  • Volumes averaged 45,285 Boe per day in the second quarter, and non-GAAP free cash flow was $37.6 million.
  • On October 6, HighPeak agreed to sell 450,000 shares of Series A 6.0% convertible preferred stock to two Indonesian investors.
  • Banks committed to an $800 million reserve-based facility, and HighPeak expects to repay its $1.17 billion term loan in full.

HighPeak Energy (NASDAQ:HPK) shares were trading near their 52-week high at USD 11.33 on October 19, 2026, up 7.39%. The Midland Basin oil producer reported a second quarter profit on August 10 and, on October 6, announced plans to replace its term loan with $450 million of convertible preferred equity and a new credit facility. The same filings set out trade-offs, from conversion terms to a strategic review that may not end in a sale.

A $450 million preferred investment and an $800 million credit facility

On October 6, HighPeak signed agreements to sell 450,000 shares of Series A 6.0% Perpetual Convertible Preferred Stock at a $1,000 stated value, for gross proceeds of about $450 million. A subsidiary of PT Danantara Investment Management, which the company describes as a sovereign fund of Indonesia, would buy 250,000 shares, and a subsidiary of PT Energi Mega Persada, an Indonesian oil and gas company, 200,000. Each investor may nominate one director. Closing is expected in the fourth quarter of 2026, subject to customary conditions.

The shares have no maturity. Cumulative dividends, payable when declared, are 6.0% in cash or 7.5% in kind for two years after closing, then 7.5% in cash or 9.0% in kind through year five, and 10.0% afterward. Holders can convert at an initial $9.50 per share, which would turn the stated value alone into roughly 47.4 million common shares, against 126,452,804 outstanding on August 6. From the third anniversary, HighPeak may redeem the shares at a price yielding a 10.0% internal rate of return.

Banks have also committed to an $800 million senior secured reserve-based credit facility, expected to complete alongside the investment. HighPeak expects to repay its existing $1.17 billion term loan in full using the proceeds, initial borrowings and cash. The announcement did not disclose the facility's interest rate or maturity.

Second quarter: higher net income, lower oil volumes

Second quarter revenue was $272.4 million, up from $216.5 million a year earlier. GAAP net income was $82.3 million, or $0.59 per diluted share, against $26.2 million, or $0.19. The quarter included a $53.4 million derivative gain, yet the first half closed with a net loss of $45.2 million, or $0.36 per diluted share, after a $103.6 million six-month derivative loss. Non-GAAP EBITDAX was $147.6 million, down from $156.0 million.

Volumes averaged 45,285 Boe per day, about 64% crude oil. Crude output was 28,952 barrels per day, down from 33,913 a year earlier. Non-GAAP free cash flow was $37.6 million, versus negative $42.7 million a year earlier, on $107.5 million of capital spending excluding acquisitions.

Cash was $146.3 million at June 30, and current maturities of long-term debt rose to $120.0 million from $60.0 million at year-end. No dividend was declared in the first half, against $0.08 per share a year earlier.

Covenants, risks and 2026 guidance

In late June, HighPeak amended its term loan and senior credit facility agreements to cap total net leverage at 2.25 to 1.00 for the quarter ended June 30. The company says there is no assurance the investment will close, the new facility will be signed on satisfactory terms, or the term loan will be refinanced. Its August release also cautions that the Board's strategic review may not result in a sale. The largest purchaser took about 88% of first-half oil, NGL and gas sales.

On March 11, HighPeak issued Board-approved 2026 guidance: capital expenditures of $255 million to $285 million, 28 to 30 operated wells drilled and average daily production of 41,000 to 44,000 Boe per day. In August, the company said first-half production ran 7% above the guidance midpoint and operating expenses 13% below it, without restating the ranges. These are the company's own estimates.