March 10, 2026

Saudi Arabian Oil Company (Aramco, Saudi Arabian Oil Co.(2222.SA)) released its full-year and fourth-quarter 2025 financial results on Tuesday, while simultaneously announcing its first-ever share buyback program, signaling a new chapter in its shareholder return strategy.

The Headline Numbers: A Miss, But With Nuance

Aramco posted full-year 2025 net income of $92.81 billion (SAR 348.04 billion), down 11.6% year-on-year from $105.04 billion in 2024. This came in below the analysts' consensus estimate of $95.6 billion, according to LSEG data — a miss that investors will want to note.

For Q4 2025 alone, net profit also fell, dropping over 20% to $17.76 billion, compared to $22.34 billion in Q4 2024. The quarterly decline was partly driven by higher operating costs, which rose to $69.7 billion from $68 billion in the same period last year.

However, investors should pay attention to the adjusted net income figure, which strips out one-time items such as impairment losses, held-for-sale remeasurements, and gains/losses on asset disposals:

• Full-year 2025 adjusted net income: $104.65 billion — broadly in line with analyst expectations
• Q4 2025 adjusted net income: $25.1 billion — nearly matching the company-provided median analyst estimate of $24.8 billion

This divergence between reported and adjusted figures is significant. The gap of ~$11.26 billion in adjustments for the full year suggests that the headline miss was largely driven by non-recurring charges rather than operational deterioration — a distinction that matters for fundamental valuation.

Why Did Profits Fall? Management's Explanation

The company attributed the decline primarily to lower crude oil prices and weaker refined and chemical product prices. Total revenue fell to $415.82 billion (SAR 1,559.34 billion), down 4.76% from $436.61 billion in 2024.

Other income related to sales also dropped sharply — from SAR 164.38 billion in 2024 to SAR 111.86 billion in 2025 — amplifying the revenue pressure.

Partially offsetting these headwinds: higher volumes sold across refined products, chemicals, gas, and crude oil, as well as lower operating costs and reduced income taxes resulting from lower taxable income.

CEO Amin Nasser: Confidence in the Strategy

Aramco President & CEO Amin H. Nasser struck an upbeat tone in his statement, emphasizing operational resilience and strategic positioning:

"Aramco delivered robust growth and strong cash flows in 2025, reinforcing confidence in our strategy. Our disciplined capital allocation, combined with our lower-cost, adaptable, and highly-reliable operations, drove strong financial performance in a year marked by price volatility."

Nasser also highlighted momentum in gas expansion and technology:

"Following another year of record oil demand in 2025, we believe ongoing investments in our operations position us well for the future. Our strong project momentum underscores potential for future operating cash flow growth, creating further opportunities and reinforcing our position as a global energy leader."

What Investors Should Watch: Cash Flow & Dividends

Despite the profit decline, Aramco's cash generation remained robust — a key metric for income-oriented investors:

The gearing ratio improved from 4.5% at end-2024 to 3.8%, reflecting a strengthening balance sheet even amid earnings pressure.

On dividends: Aramco declared a Q4 base dividend of $21.89 billion ($0.09074/share in USD terms; SAR 0.3393/share), representing a 3.5% increase year-on-year — the fourth consecutive annual increase to the base dividend. This will be paid in Q1 2026, with an eligibility date of March 16, 2026.

Total shareholder distributions for the full year 2025 reached $85.5 billion.

The Big News: Aramco's First-Ever Share Buyback

Perhaps the most notable announcement for investors is Aramco's first-ever share repurchase program. The board approved the buyback of up to 350 million ordinary shares — worth up to $3.0 billion — to be executed over the next 18 months using internal funds.

The repurchased shares will be retained as treasury shares and allocated to employee share plans. Shares held as treasury stock carry no voting rights.

Until now, Aramco has relied exclusively on its dividend payouts — among the largest in the world — to return capital to shareholders. The introduction of buybacks signals a broadening of the company's capital return toolkit, which analysts may view as a positive structural development even if the initial size is relatively modest relative to Aramco's market cap.

Capital Expenditure: Disciplined Spending

FY 2025 capital investment came in at $52.2 billion, in line with guidance and $1.0 billion lower than 2024. For 2026, Aramco guided for capex of $50.0–$55.0 billion, suggesting continued discipline.

Key project milestones in 2025 include:

• Jafurah gas field: Production commenced, part of Aramco's plan to grow sales gas production capacity by ~80% by 2030 from 2021 levels
• Tanajib Gas Plant: Operations commenced
• Marjan crude oil increment: Brought onstream
• Berri crude oil increment: Water injection operations commenced

These developments support Aramco's operational flexibility and ability to respond to shifting market conditions.

AI & Technology: A Growing Value Driver

Aramco reported Technology Realized Value (TRV) of $5.3 billion from AI, digital, and other solutions in 2025, bringing cumulative TRV to $11.3 billion since 2023. The company also disclosed plans to acquire a significant minority interest in HUMAIN, an AI-focused venture, to unlock new value creation opportunities in the sector.

CEO Nasser noted that the company "continues to leverage advanced technologies including AI to enhance efficiency and unlock value across our business" — a theme likely to receive increasing investor attention as energy majors compete to monetize technology investments.

Market Context: Geopolitical Volatility

Results were released against a backdrop of significant geopolitical turbulence. Reuters noted that the U.S.-Israeli war on Iran has led to a near-closure of the Strait of Hormuz, forcing several regional producers to curtail output. This context adds uncertainty to Aramco's near-term production outlook, and is a key macro risk factor investors should monitor closely heading into 2026.

The Bottom Line for Investors

Aramco's 2025 results present a mixed but fundamentally sound picture: headline profits missed expectations, but adjusted earnings were in line, cash flows remained strong, the balance sheet improved, and shareholder returns continued to grow. The launch of a buyback program — however modest in scale — marks a meaningful evolution in capital allocation strategy.

With capex guidance steady, gas expansion on track, and AI investment beginning to generate measurable returns, the investment case rests on whether oil prices stabilize and whether Aramco's operational leverage can translate into earnings recovery in 2026.

Aramco will discuss its full-year financial results for 2025 in an audio webcast on March 10, 2026 at 11.30am Riyadh / 8.30am London / 4.30am New York. To register for the webcast, visit www.aramco.com/investors.

Sources: Saudi Aramco exchange filings (Tadawul), Reuters, LSEG analyst data