Petrobras Profit Rose but Missed Forecasts as One-Off Charges Masked Record Operations

Petrobras reported third-quarter net income of R$39.75 billion, up 21.5 percent from a year earlier but below the R$47.02 billion analysts expected in an LSEG poll.

Petrobras, Brazil's state-run oil company, reported the results on Tuesday after the close. The quarter ran from July to September 2026.

Reported adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) was R$85.8 billion. It rose 34.3 percent from a year earlier but missed the R$94.0 billion LSEG consensus.

One-off charges, not operations, caused the miss

Excluding exclusive events (one-off items the company separates out), net income was R$47.9 billion. That sits above the R$47.02 billion poll figure, a plain comparison of two printed figures. Adjusted EBITDA excluding exclusive events was R$94.5 billion, down 6.1 percent sequentially.

The exclusive events cut reported profit by R$8.1 billion after tax, a TickerGrove calculation. Pre-tax, the items totaled a negative R$12.3 billion, partly offset by a R$4.2 billion tax effect.

One bucket of R$8.7 billion also reduced adjusted EBITDA. It held judicial contingencies of R$4.2 billion and a crude-oil and diesel export tax of R$4.5 billion.

Items that did not affect EBITDA totaled a negative R$3.6 billion. They included a R$3.7 billion loss on disposal and write-down of assets, partly offset by smaller gains.

The report links that loss to a payment obligation under the 2019 TAG sale contract. The obligation was triggered by the regulator's October deliberation on 2026 to 2030 tariff premises.

Foreign-exchange gains added only R$116 million, against R$5.6 billion a year earlier and R$1.8 billion in the second quarter.

Sequentially, reported net income fell 24.2 percent from R$52.4 billion in the second quarter.

Revenue rose 32.4 percent year over year to R$169.4 billion, nearly flat sequentially. Gross profit fell 7.5 percent sequentially to R$90.9 billion.

Brent crude averaged $97.00 a barrel, down 7.2 percent from the second quarter. Lower recognized crude volume also weighed, the company said. Exports still in transit at quarter-end held back about 140,000 barrels a day, expected in the fourth quarter.

Production and refining set records

Total production reached a record 3.512 million barrels of oil equivalent a day, up 11.7 percent year over year. Pre-salt fields produced 2.96 million of that total, and 11 platforms produced above their original capacity.

Diesel output set a record at 769,000 barrels a day. Refineries ran at 99 percent of capacity, producing 1.873 million barrels of products a day.

Domestic product sales reached a record 1.854 million barrels a day, the company's agency release said. Oil and product exports also set a record, at 1.251 million barrels a day.

Chief Executive Magda Chambriard said the full-year production average is now expected at 3.3 million to 3.4 million. The earlier projection was to end the year at a 3.1 million average, she said in the release.

Finance chief Fernando Melgarejo said strong cash generation funded the accelerating investments. It also funded shareholder payouts and lower financial debt, he said.

A R$15.3 billion payout, paid in 2027

The board approved R$15.3 billion in dividends and interest on equity on Tuesday. The payout relates to the third-quarter result, as an anticipation of 2026 remuneration.

Each common and preferred share receives R$1.18732774, the material fact showed. Payment comes in two equal installments of R$0.59366387 each.

The first installment is due February 22, 2027, and the second March 22, 2027. Holders on the B3 exchange at the close of December 21, 2026 qualify.

Amounts will be updated by the Selic rate (Brazil's benchmark interest rate) from December 31, 2026. The update runs to each payment date.

The company will define the payout's form by December 10, 2026, the material fact said. It will say whether payment is dividends, interest on equity, or a mix.

Guidance rose on spending, cash flow and leases

Third-quarter investments totaled $6.4 billion on an accrual basis, up 21.2 percent sequentially. Exploration and production took $5.3 billion, and cash-basis investment was $5.4 billion.

For 2026, total capital spending guidance for the implementation portfolio rose to $24 billion to $25.5 billion, from $19.4 billion. Cash investment guidance rose to $21 billion to $22 billion, from $16.9 billion.

The company stressed the revision does not raise total project costs. It reflects the currency effect and faster execution than planned, the company said.

The cash view also includes October auction signature bonuses, payable in December. The Búzios 9 and Búzios 10 platforms are still planned for nationalization in 2026.

Operating cash flow guidance for 2026 rose to $45 billion to $50 billion, from $35 billion. The company cited the new Brent price level and production growth. Lease-flow guidance rose to $11 billion to $11.5 billion, from $10 billion.

The P-80 sailed from Singapore on September 30, and the P-82 on October 18. Both are heading to the Búzios field, and each can produce 225,000 barrels a day.

Cash flow held up as debt fell

Operating cash flow was R$61.8 billion, almost unchanged sequentially and up 15.2 percent year over year. Free cash flow (operating cash flow less capital spending) was R$34.0 billion, down 11.9 percent sequentially.

Gross debt eased to $69.97 billion, down 1.2 percent from the second quarter. Net debt fell 4.2 percent to $57.85 billion.

Net debt stood at 1.00 times the last twelve months of adjusted EBITDA. A quarter earlier the ratio was 1.14 times, and a year earlier 1.53 times.

In the company's own dollar equivalents, net income was $7.7 billion and operating cash flow $12 billion. Those equivalents use the average exchange rate, not a spot conversion.

Petrobras shares closed Tuesday at $18.28 in New York, down 0.38 percent, Finnhub data showed. The results came after that close, so Wednesday brings the first market verdict.

What remains unknown

What remains unknown includes how much of the one-off charge pattern repeats. Whether judicial contingencies or the export tax recur at this scale is not stated.

The payout's form is undecided until the December 10 notice. The earnings call was scheduled for 9:30 a.m. ET on Wednesday, November 11.

Whether the charges fade and the barrels land

What to watch: Wednesday's first market verdict on the miss and the payout.

Watch the December 10 notice on the payout's form, and the December 21 record date.