Key Highlights

  • Net income was $185 million, or $0.31 per diluted share, in Q2 2026.
  • Revenue rose to $607 million as production grew 12% YoY.
  • Net Debt fell more than $400 million in the first half of 2026.
  • Shares closed at $2.78, up $0.06, or 2%, at Tuesday's close.

Kosmos Energy Ltd. (NYSE:KOS)'s second quarter combined a swing to Net Income with continued net debt reduction, as production increases at Jubilee and Greater Tortue Ahmeyim offset the loss of Equatorial Guinea volumes following that asset's sale. Chairman and Chief Executive Officer Andrew Inglis said the company made progress against its four 2026 goals: increasing production, lowering costs, reducing debt, and advancing its growth portfolio with minimal capital.

KOS is a deepwater oil and gas exploration and production company with Assets offshore Ghana, Mauritania, Senegal and the Gulf of America. The company completed the sale of its interest in the Ceiba Field and Okume Complex in Equatorial Guinea to Panoro Energy on June 16, 2026, and completed a farm-down of its operated Tiberius project in the Gulf of America to Navitas after quarter-end.

Total net production averaged approximately 71,400 barrels of oil equivalent per day in the quarter, up approximately 12% year over year, while sales averaged approximately 77,000 boepd. The company exited the quarter with approximately $2.56 billion of net debt and over $500 million of liquidity.

Second quarter 2026 compared with the prior-year quarter

Oil and gas Revenue rose to $607.3 million from $392.6 million, with the average total sales price per Barrel of Oil Equivalent rising to $86.68 from $58.93. Oil and gas production costs fell to $179.4 million, or $25.61 per boe, from $243.1 million, or $36.49 per boe, a decrease the company attributed in part to the Equatorial Guinea sale and lower costs.

Net income was $184.8 million, or $0.31 per diluted share, against a net loss of $87.7 million, or $0.18 per share, a year earlier. Adjusted net income was $68.2 million, or $0.11 per diluted share, against an adjusted net loss of $92.7 million, or $0.19 per share.

Net cash provided by Operating Activities was $175.0 million, and free Cash Flow was $88.9 million, against $44.6 million a year earlier. Capital expenditure was $105 million, in line with guidance. Total long-term debt was $2,719.7 million at June 30, 2026, against $3,100.3 million at December 31, 2025, and net debt was $2,563.4 million against $2,982.5 million.

Management outlook and stated risks

Management said it added hedges for 2027, with 7.0 million barrels of oil hedged with an average floor of approximately $67 per barrel and a ceiling of approximately $84 per barrel, alongside 3.25 million barrels hedged for the remainder of 2026 at an average floor of approximately $66 per barrel. The company said it has commenced the process to refinance its reserve-based lending Facility with its lending banks, targeting completion by the fourth quarter.

Inglis said the company is making good progress toward its approximately 20% debt reduction target for the year. The company said full-year 2026 Capital Expenditure guidance of $350 million remains unchanged, and it listed risks including oil and gas price volatility, the performance of its hedging program, and execution of the RBL refinancing.

The Bottom Line

Management tied its near-term plans to the Jubilee drilling campaign, where it said the final producer well was due online imminently and a water injection well was expected around the end of the third quarter, and to securing a rig for a 2027/2028 campaign of up to ten wells. It also pointed to Shell's planned first-quarter 2027 drilling of the Trailblazer prospect in the Gulf of America, where Kosmos is designated development operator in the event of exploration success.