France-based oil major TotalEnergies SE (NYSE: TTE) released its third-quarter results on Oct. 29, showing adjusted net profit of $9.1 billion, up 127% year over year. This marks the highest level since the first quarter of 2022 and represents more than a doubling from roughly $4 billion a year earlier. The figure also rose 51% quarter over quarter and exceeded the $8.3 billion consensus estimate compiled by LSEG from 12 analysts. The strong performance was driven by reduced global refined product supply following the U.S.-Israel conflict with Iran.
IFRS net profit reached $8.26 billion, more than doubling year over year and setting a single-quarter record. Operating cash flow excluding working capital changes came in at $12.26 billion, up 25% quarter over quarter. The gearing ratio fell to 9.1% from 13.1% at the end of the second quarter. As of press time, TotalEnergies SE (NYSE: TTE) shares rose 2% to $94.71, underperforming the European energy sector. The stock has gained about 50.4% year to date.
The downstream business was a major highlight this quarter, with adjusted net operating income reaching $4.07 billion, up 77% quarter over quarter and setting a single-quarter record. This was driven by the European refining margin indicator rising to $33.20 per barrel, a 2.5-fold increase quarter over quarter, and refinery throughput climbing nearly 10%.
The integrated LNG segment saw profit rise 2.3-fold quarter over quarter to $1.89 billion, with average LNG prices up 20% quarter over quarter to $12.28 per million British thermal units. The trading business exceeded expectations for a third consecutive quarter. The exploration and production segment posted profit of $3.16 billion, with oil and gas production at 2.474 million barrels of oil equivalent per day, up 3% quarter over quarter and more than 4% year over year after excluding the impact of Middle East conflicts, which dragged down output by about 5% on average during the quarter.
The company expects fourth-quarter LNG average prices to exceed $14 per million British thermal units, with production growth above 3% after excluding Middle East impacts. Net investment for 2026 is expected to remain at about $15 billion. During the quarter, the company made final investment decisions on Cyprus's Cronos, Nigeria's Ima, UAE's Umm Shaif and Azerbaijan's Absheron Phase 2 projects. All projects aimed at achieving the target of more than 3% annual production growth by 2030 have now entered the execution phase.
TotalEnergies SE (NYSE: TTE) had previewed in October that third-quarter profit would be boosted by refining margins nearly quadrupling from a year earlier to $33.20 per barrel and higher liquefied natural gas revenue. The company said its refining and chemicals division posted profit of $3.6 billion, more than five times the level a year earlier and double the previous quarter. Refinery throughput grew nearly 10%, allowing the company to fully capture historically high refining margins in Europe and globally.
On shareholder returns, the company confirmed a third interim dividend of 0.90 euros per share, up 5.9% year over year, and raised its fourth-quarter and first-quarter 2027 buyback allowances to $2.5 billion each for cancellation. It also announced a directed share issuance for employees at a 20% discount. TotalEnergies SE (NYSE: TTE) reiterated its $25 billion stock buyback plan for the fourth quarter and said it will repurchase another $25 billion in the first quarter of 2027, at the high end of the guidance range given last month.
Peer Shell plc (NYSE: SHEL) also reported better-than-expected profit on Thursday. Its reported third-quarter 2026 results showed non-GAAP adjusted net profit of $10.814 billion, up 99% year over year and above analyst estimates of about $10.33 billion. This was the company's highest single-quarter profit since the initial months following the full-scale Russia-Ukraine war in early 2022 and its second-highest quarterly earnings in history.
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