Operating margins plummeted from 54.4% in 2023Q4 to 2.7% in 2026Q1, reflecting significant pressure from rising extraction costs and service inflation.
| Metric | TTM | Dec'25 | Dec'24 | Dec'23 | Dec'22 | Dec'21 | Dec'20 | Dec'19 | Dec'18 | Dec'17 | Dec'16 | Dec'15 | Dec'14 | Dec'13 | Dec'12 | Dec'11 | Dec'10 | Dec'09 |
|---|
| Sales/Revenue | 15.19B | 15.03B | 11.02B | 8.34B | 9.57B | 6.75B | 2.81B | 3.96B | 2.18B | 1.21B | 527.11M | 446.73M | 495.72M | 208M | 74.96M | 49.37M | 27.25M | 12.72M |
| Revenue Growth % | 18.35% | 36.31% | 32.19% | -12.83% | 41.78% | 139.85% | -29.04% | 82.17% | 80.58% | 128.61% | 17.99% | -9.88% | 138.32% | 177.48% | 51.85% | 81.14% | 114.32% | - |
| Cost of Goods Sold | 8.84B | 9.74B | 6.05B | 3.54B | 2.87B | 2.48B | 2.18B | 2.37B | 1.06B | 551M | 306.5M | 339.4M | 261.31M | 101.57M | 47.18M | 30.5M | 15M | 705.16K |
| COGS % of Revenue | - | 64.84% | 54.89% | 42.46% | 29.95% | 36.71% | 77.36% | 59.81% | 48.67% | 45.73% | 58.15% | 75.97% | 52.71% | 48.83% | 62.94% | 61.78% | 55.03% | 5.55% |
| Gross Profit | 6.36B | 5.28B | 4.97B | 4.8B | 6.7B | 4.27B | 637M | 1.59B | 1.12B | 654M | 220.6M | 107.33M | 234.4M | 106.43M | 27.78M | 18.87M | 12.26M | 12.01M |
| Gross Margin % | 41.83% | 35.16% | 45.11% | 57.54% | 70.05% | 63.29% | 22.64% | 40.19% | 51.33% | 54.27% | 41.85% | 24.03% | 47.29% | 51.17% | 37.06% | 38.22% | 44.97% | 94.45% |
| Gross Profit Growth % | - | 6.25% | 3.63% | -28.4% | 56.93% | 570.33% | -60.01% | 42.61% | 70.8% | 196.46% | 105.54% | -54.21% | 120.24% | 283.11% | 47.25% | 53.95% | 2.03% | - |
| Operating Expenses | 2.99B | 365M | 576M | 228M | 193M | 269M | 6.11B | 898M | 106M | 49M | 289.22M | 847.6M | 21.73M | 11.24M | 10.47M | 3.72M | 3.07M | 10.67M |
| OpEx % of Revenue | - | 2.43% | 5.23% | 2.73% | 2.02% | 3.99% | 217.31% | 22.65% | 4.87% | 4.07% | 54.87% | 189.73% | 4.38% | 5.4% | 13.97% | 7.54% | 11.28% | 83.93% |
| Selling, General & Admin | 294M | 288M | 213M | 150M | 144M | 146M | 88M | 104M | 64.55M | 48.67M | 42.62M | 31.97M | 21.27M | 11.04M | 10.38M | 3.6M | 3.05M | 5.06M |
| SG&A % of Revenue | - | 1.92% | 1.93% | 1.8% | 1.51% | 2.16% | 3.13% | 2.62% | 2.97% | 4.04% | 8.09% | 7.16% | 4.29% | 5.31% | 13.84% | 7.3% | 11.2% | 39.81% |
| Research & Development | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| R&D % of Revenue | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Other Operating Expenses | 2M | 77M | 363M | 78M | 49M | 123M | 6.03B | 794M | 41M | 1M | 246.6M | 815.63M | 467K | 201K | 98K | 65K | 38K | 5.61M |
| Operating Income | 3.36B | 4.92B | 4.4B | 4.57B | 6.51B | 4B | -5.48B | 695M | 1.01B | 605M | -68.62M | -740.27M | 212.67M | 95.19M | 17.31M | 15.15M | 9.18M | 1.34M |
| Operating Margin % | 22.12% | 32.73% | 39.88% | 54.8% | 68.03% | 59.3% | -194.67% | 17.53% | 46.46% | 50.21% | -13.02% | -165.71% | 42.9% | 45.77% | 23.09% | 30.68% | 33.69% | 10.52% |
| Operating Income Growth % | - | 11.87% | -3.81% | -29.78% | 62.66% | 173.06% | -887.91% | -31.26% | 67.11% | 981.71% | 90.73% | -448.08% | 123.41% | 450.03% | 14.26% | 64.98% | 586.28% | - |
| EBITDA | 8.6B | 9.96B | 7.25B | 6.32B | 7.85B | 5.28B | -4.17B | 2.15B | 1.63B | 932M | 109.4M | -522.57M | 382.68M | 161.79M | 43.58M | 31.25M | 17.33M | 4.55M |
| EBITDA Margin % | 56.64% | 66.26% | 65.74% | 75.74% | 82.08% | 78.2% | -148.06% | 54.21% | 75.09% | 77.34% | 20.75% | -116.98% | 77.2% | 77.78% | 58.14% | 63.3% | 63.57% | 35.81% |
| EBITDA Growth % | 2.19% | 37.4% | 14.72% | -19.56% | 48.82% | 226.67% | -293.81% | 31.52% | 75.32% | 751.94% | 120.93% | -236.56% | 136.52% | 271.25% | 39.45% | 80.37% | 280.48% | - |
| D&A (Non-Cash Add-back) | 5.24B | 5.04B | 2.85B | 1.75B | 1.34B | 1.27B | 1.31B | 1.45B | 623M | 327M | 178.01M | 217.7M | 170M | 66.6M | 26.27M | 16.1M | 8.14M | 3.22M |
| EBIT | 177M | 2.12B | 4.79B | 4.42B | 5.88B | 3.1B | -5.58B | 531M | 1.19B | 538M | -124.03M | -707.59M | 339.47M | 92.71M | 21.39M | 1.89M | 9.07M | 1.34M |
| Net Interest Income | -267M | -244M | -135M | -175M | -159M | -199M | -197M | -172M | -87M | -41M | -40.68M | -41.51M | -34.51M | -8.06M | -3.61M | -2.52M | -802K | 24.14K |
| Interest Income | 0 | 0 | 156M | 0 | 1M | 1M | 4M | 1M | 1M | 0 | 0 | 0 | 0 | 1K | 3K | 11K | 34K | 35.08K |
| Interest Expense | 267M | 244M | 291M | 175M | 160M | 200M | 201M | 173M | 87.84M | 41M | 40.68M | 41.51M | 34.51M | 8.06M | 3.61M | 2.53M | 836K | 10.94K |
| Other Income/Expense | -3.21B | -3.04B | 105M | -322M | -772M | -1.09B | -300M | -333M | 102M | -108M | -96.1M | -8.83M | 92.29M | -8.85M | 1.07M | -15.53M | -950K | -1.34M |
| Pretax Income | 156M | 1.87B | 4.5B | 4.25B | 5.74B | 2.91B | -5.78B | 362M | 1.11B | 497.19M | -164.72M | -749.1M | 304.96M | 86.34M | 18.38M | 1.97M | 9.02M | -2.73M |
| Pretax Margin % | 1.03% | 12.47% | 40.83% | 50.94% | 59.96% | 43.09% | -205.33% | 9.13% | 51.16% | 41.26% | -31.25% | -167.68% | 61.52% | 41.51% | 24.52% | 3.99% | 33.09% | -21.47% |
| Income Tax | -44M | 327M | 800M | 912M | 1.17B | 631M | -1.1B | 47M | 168.36M | -19.57M | 192K | -201.31M | 108.98M | 31.75M | 6.55M | 15.53M | 949.77K | 4.04M |
| Effective Tax Rate % | -28.21% | 17.45% | 17.77% | 21.47% | 20.47% | 21.71% | 19.11% | 12.98% | 15.12% | -3.94% | -0.12% | 26.87% | 35.74% | 36.78% | 35.65% | 787.41% | 10.53% | -148.12% |
| Net Income | 403M | 1.66B | 3.34B | 3.14B | 4.39B | 2.18B | -4.52B | 240M | 846M | 482M | -165.03M | -550.63M | 193.75M | 54.59M | -36.52M | -386K | 8.23M | -2.71M |
| Net Margin % | 2.65% | 11.07% | 30.28% | 37.69% | 45.85% | 32.34% | -160.58% | 6.05% | 38.88% | 40% | -31.31% | -123.26% | 39.09% | 26.24% | -48.72% | -0.78% | 30.2% | -21.28% |
| Net Income Growth % | -89.86% | -50.15% | 6.2% | -28.34% | 101.01% | 148.31% | -1982.08% | -71.63% | 75.52% | 392.06% | 70.03% | -384.19% | 254.95% | 249.47% | -9361.4% | -104.69% | 404.17% | - |
| Net Income (Continuing) | 200M | 1.55B | 3.7B | 3.34B | 4.56B | 2.28B | -4.67B | 315M | 944.89M | 516.76M | -164.91M | -547.79M | 195.97M | 54.59M | -36.52M | -386K | 8.23M | -2.71M |
| Discontinued Operations | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Minority Interest | 6.17B | 6B | 2.13B | 805M | 681M | 1.16B | 1.01B | 1.66B | 467M | 326.88M | 320.83M | 233M | 234.2M | 0 | 0 | 0 | 0 | 0 |
| EPS (Diluted) | 1.43 | 5.73 | 15.53 | 17.34 | 24.61 | 12.30 | -28.59 | 1.46 | 8.06 | 4.94 | -2.20 | -8.74 | 3.64 | 1.29 | -0.99 | -0.02 | 0.36 | -0.12 |
| EPS Growth % | -94.8% | -63.1% | -10.44% | -29.54% | 100.08% | 143.02% | -2058.22% | -81.89% | 63.16% | 324.55% | 74.83% | -340.11% | 182.17% | 230.3% | -4007.88% | -106.69% | 400% | - |
| EPS (Basic) | - | 5.73 | 15.53 | 17.34 | 24.61 | 12.35 | -28.59 | 1.47 | 8.08 | 4.95 | -2.20 | -8.74 | 3.67 | 1.30 | -0.99 | -0.02 | 0.36 | -0.12 |
| Diluted Shares Outstanding | 282.79M | 289.08M | 213.54M | 180M | 176.54M | 177.36M | 157.98M | 163.84M | 104.93M | 97.69M | 75.08M | 63.02M | 53.3M | 42.26M | 36.99M | 22.61M | 22.61M | 22.61M |
| Basic Shares Outstanding | 282.79M | 289.08M | 213.54M | 180M | 176.54M | 176.64M | 157.98M | 163.49M | 104.62M | 97.46M | 75.08M | 63.02M | 52.83M | 42.02M | 36.99M | 36.99M | 36.99M | 35.11M |
| Dividend Payout Ratio | - | 69.47% | 47.27% | 45.94% | 35.84% | 14.3% | - | 46.67% | 4.37% | - | - | - | - | - | - | - | 67.78% | - |
Inventory exhaustion and margin compression
As reported in recent financial filings, Diamondback Energy experienced significant revenue fluctuations, peaking at 81.7% year-over-year growth in 2025Q1 before decelerating to 5.2% by 2026Q1, highlighting the inherent sensitivity of the company's pure-play Permian production model to volatile commodity price cycles and regional basis differentials.
The erratic revenue trajectory suggests that Diamondback's top-line performance is heavily tethered to external market pricing rather than consistent volume expansion. Investors should monitor whether the company can maintain production growth as it integrates recent large-scale acquisitions, which may temporarily mask underlying organic production trends.
Based on the provided income statement data, Diamondback's gross margin contracted sharply from a peak of 56.2% in 2023Q4 to 24.3% by 2025Q4, indicating that rising extraction costs and potential service inflation are significantly eroding the profitability of each barrel produced in the Permian Basin.
The rapid deterioration in gross margins suggests that the company's cost-to-produce is rising faster than realized prices, potentially signaling the exhaustion of lower-cost Tier 1 inventory. This trend warrants further investigation into whether the company's operational efficiencies are sufficient to offset the increasing geological complexity of its remaining acreage.
According to the latest quarterly figures, Diamondback's operating margin plummeted to 2.7% in 2026Q1 from 54.4% in 2023Q4, demonstrating a failure to scale operating income alongside revenue and suggesting that fixed costs are becoming increasingly burdensome relative to the company's current production output and realized pricing.
The collapse in operating leverage implies that the company's lean corporate structure is struggling to absorb the impact of lower gross profits. Analysts should scrutinize whether this trend is a temporary byproduct of recent M&A integration or a more permanent shift in the company's ability to maintain its historical cost advantage.
As indicated by the company's financial statements, net income swung from a $1.5 billion loss in 2025Q4 to a $144 million profit in 2026Q1, reflecting significant non-operating volatility that complicates the assessment of core earnings power and the sustainability of shareholder return programs.
The extreme variance in net income, coupled with the lumpy nature of EPS, suggests that investors should focus on cash flow metrics rather than reported net income to gauge true performance. The presence of non-cash charges and potential accounting adjustments related to subsidiary consolidation makes it difficult to ascertain the underlying profitability of the core E&P business.
Quick answers to the most common questions about buying FANG stock.
For fiscal year 2025, Diamondback Energy, Inc. (FANG) reported total revenue of $15.03B. This represents a 118066.0% increase compared to $12.7M in 2009.
Diamondback Energy, Inc. (FANG) is profitable, generating $1.66B in net income for the fiscal year ending 2025 with a net profit margin of 11.1%.
Diamondback Energy, Inc. (FANG) reported an operating income of $4.92B, resulting in an operating profit margin of 32.7%. This margin reflects the operational efficiency of the business before interest and taxes.
Diamondback Energy, Inc. (FANG) generated $5.28B in gross profit for the year, representing a gross profit margin of 35.2%. This demonstrates the company's core pricing power and production efficiency.