Crescent Energy Co

Previous wording

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to provide the reader of the financial statements with a narrative from the perspective of management on the financial condition, results of operations, liquidity and certain other factors that may affect the Company's operating results. The following discussion and analysis should be read in conjunction with Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2024 ("Annual Report"), our Quarterly Report on Form 10-Q for the period ended March 31, 2025 and June 30, 2025, as well as our unaudited condensed consolidated financial statements for the three and nine months ended September 30, 2025 and 2024. The following information updates the discussion of our financial condition provided in our previous filings, and analyzes the changes in the results of operations between the three and nine months ended September 30, 2025 and 2024. The following discussion contains forward-looking statements that reflect our future plans, estimates, beliefs and expected performance. The forward-looking statements are dependent upon events, risks and uncertainties that may be outside our control. Our actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, commodity price volatility, capital requirements and uncertainty of obtaining additional funding on terms acceptable to the Company, realized oil, natural gas and NGL prices, the timing and amount of future production of oil, natural gas and NGLs, shortages of equipment, supplies, services and qualified personnel, as well as those factors discussed below and elsewhere in this Quarterly Report and in our Annual Report, particularly under “Risk Factors” and “Cautionary Statement Regarding Forward Looking Statements,” all of which are difficult to predict. In light of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur. We do not undertake any obligation to publicly update any forward-looking statements except as otherwise required by applicable law. Unless otherwise stated or the context otherwise indicates, all references to “we,” “us,” “our,” "Crescent" and the “Company” or similar expressions refer to Crescent Energy Company and its subsidiaries.

Current wording

Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is intended to provide the reader of the financial statements with a narrative from the perspective of management on the financial condition, results of operations, liquidity and certain other factors that may affect the Company's operating results. The following discussion and analysis should be read in conjunction with Management's Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2025 ("Annual Report"), as well as our unaudited condensed consolidated financial statements for the three months ended March 31, 2026 and 2025. The following information updates the discussion of our financial condition provided in our previous filings, and analyzes the changes in the results of operations between the three months ended March 31, 2026 and 2025. The following discussion contains forward-looking statements that reflect our future plans, estimates, beliefs and expected performance. The forward-looking statements are dependent upon events, risks and uncertainties that may be outside our control. Our actual results could differ materially from those discussed in these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, commodity price volatility, capital requirements and uncertainty of obtaining additional funding on terms acceptable to the Company, realized oil, natural gas and NGL prices, the timing and amount of future production of oil, natural gas and NGLs, shortages of equipment, supplies, services and qualified personnel, as well as those factors discussed below and elsewhere in this Quarterly Report and in our Annual Report, particularly under “Risk Factors” and “Cautionary Statement Regarding Forward Looking Statements,” all of which are difficult to predict. In light of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur. We do not undertake any obligation to publicly update any forward-looking statements except as otherwise required by applicable law. Unless otherwise stated or the context otherwise indicates, all references to “we,” “us,” “our,” "Crescent" and the “Company” or similar expressions refer to Crescent Energy Company ("CEC") and its subsidiaries.

Previous wording

Crescent is a differentiated U.S. energy company committed to delivering value for shareholders through a disciplined growth through acquisition strategy and consistent return of capital. Our long-life, balanced portfolio combines stable cash flows from low-decline production with deep, high-quality development inventory. Our activities are focused in Texas and the Rocky Mountain region.

Current wording

Crescent is a differentiated U.S. energy company committed to delivering value through a disciplined, returns-driven growth through acquisition strategy and consistent return of capital. Our long-life, balanced portfolio combines significant cash flow from stable production with deep, high-quality development inventory. Our activities are focused in the Eagle Ford, Permian Basin and Uinta Basin, and we own minerals and royalty interests across premier U.S. oil and natural gas basins, primarily operated by large, well-capitalized companies, with a core focus in the Eagle Ford.

Previous wording

During the last several years, prices of crude oil, natural gas and NGLs have experienced periodic downturns and sustained volatility, impacted by geopolitical events, such as Russia’s invasion of Ukraine and the related sanctions imposed on Russia, Hamas' attack against Israel and the ensuing conflict and escalation of tensions in the Middle East, including the conflict with Iran, supply chain constraints, elevated interest rates, U.S. international trade and tariff policy developments and responses thereto and costs of capital and political and regulatory uncertainties. Furthermore, the United States has experienced, and may continue to experience, a significant inflationary environment, which began in 2022 that, along with international geopolitical risks and market responses to the announcement of certain tariff policies by the Trump Administration, has contributed to concerns of a potential recession in the United States in 2025 that has created further volatility. OPEC has announced that it is phasing out oil output cuts by increasing 411,000 barrels per day, each month from May to July 2025 and then increasing to 548,000 barrels per day in August 2025. The actions of OPEC with respect to oil production levels and announcements of potential changes in such levels may result in further volatility in commodity prices and the oil and natural gas industry generally. Such volatility may lead to a more difficult investing and planning environment for us and our customers. While we use derivative instruments to partially mitigate the impact of commodity price volatility, our revenues and operating results depend significantly upon the prevailing prices for oil and natural gas.

Current wording

During the last several years, prices of crude oil, natural gas and NGLs have experienced periodic downturns and sustained volatility, impacted by geopolitical events, such as Russia’s invasion of Ukraine and the related sanctions imposed on Russia, Hamas' attack against Israel and the ensuing conflict and escalation of tensions in the Middle East. For example, the ongoing military conflict in Iran, which began in February 2026, has heightened geopolitical risk in key global energy markets and contributed to increased volatility in oil and gas commodity prices. The conflict has resulted in disruptions and constraints on maritime transit, supply chains, and energy infrastructure in the Middle East, including in and around the Strait of Hormuz, a critical choke point for global oil and liquefied natural gas shipments. These developments have led to elevated risk premiums in energy commodity prices and greater short‑term price uncertainty, causing global crude oil prices to surpass $100 per Bbl. Commodity prices and broader market conditions have also been affected by developments in Venezuela, supply chain constraints, elevated interest rates, U.S. international trade and tariff policies and responses thereto and costs of capital and political and regulatory uncertainties. Furthermore, the United States has experienced, and may continue to experience, a significant inflationary environment, which began in 2022 that, along with international geopolitical risks and market responses to the announcement of certain tariff policies by the Trump Administration, has contributed to concerns of a potential recession in the United States in 2026 that has created further volatility. For example, actions taken by OPEC and allies with respect to production levels, and announcements of potential changes in such levels, including production adjustments during 2025 and the first quarter of 2026, have contributed, and may continue to contribute, to volatility in commodity prices and in the oil and natural gas industry generally. Such volatility may lead to a more difficult investing and planning environment for us and our customers. While we use derivative instruments to partially mitigate the impact of commodity price volatility, our revenues and operating results depend significantly upon the prevailing prices for oil and natural gas.

Previous wording

During the three and nine months ended September 30, 2025, we recorded impairment expense of $73.5 million and $122.2 million, respectively, related to oil and natural gas properties. See NOTE 5 – Fair Value Measurements to the unaudited financial statements included in Part I. Item 1. Financial Statements. Certain of our conventional proved oil and natural gas properties in Oklahoma, which have a carrying value of $276.3 million, have limited cushion between their carrying value and estimated undiscounted cash flows at the current forward commodity price curve as of September 30, 2025. A further decline of future commodity prices or a decrease in estimates of oil and natural gas reserves for these assets would likely result in an impairment charge. The actual amount of impairment incurred, if any, for these properties will depend on a variety of factors including, but not limited to, subsequent forward price curve changes, weighted-average cost of capital, operating cost estimates and future capital expenditures estimates. An estimate of the sensitivity to changes in assumptions in our fair value calculations is not practicable, given the numerous assumptions (e.g. reserves, pace and timing of development plans, commodity prices, capital expenditures, operating costs, drilling and development costs, inflation and discount rates) that can materially affect our estimates. Unfavorable adjustments to some of the above listed assumptions would likely be offset by favorable adjustments in other assumptions. For example, the impact of sustained reduced commodity prices would likely be partially offset by lower costs.

Current wording

During the three months ended March 31, 2026, no impairment expense was incurred. During the three months ended March 31, 2025, we recorded an impairment expense of $45.6 million to write down the value of certain assets classified as held for sale to expected net proceeds. A decline of future commodity prices or a decrease in estimates of oil and natural gas reserves for our assets would likely result in an impairment charge. The actual amount of impairment incurred, if any, for these properties will depend on a variety of factors including, but not limited to, subsequent forward price curve changes, weighted-average cost of capital, operating cost estimates and future capital expenditures estimates. An estimate of the sensitivity to changes in assumptions in our fair value calculations is not practicable, given the numerous assumptions (e.g. reserves, pace and timing of development plans, commodity prices, capital expenditures, operating costs, drilling and development costs, inflation and discount rates) that can materially affect our estimates. Unfavorable adjustments to some of the above listed assumptions would likely be offset by favorable adjustments in other assumptions. For example, the impact of sustained reduced commodity prices would likely be partially offset by lower costs.

Previous wording

Due to the cyclical nature of the oil and gas industry, fluctuating demand for oilfield goods and services can put pressure on the pricing structure within our industry. As commodity prices rise, the cost of oilfield goods and services generally also increase, while during periods of commodity price declines, oilfield costs typically lag and do not adjust downward as fast as oil prices do. The U.S. inflation rate has remained relatively stable through 2024 and 2025, after an extended period of elevation. Inflationary pressures have resulted in and may result in additional increases to the costs of our oilfield goods, services and personnel, which in turn cause our capital expenditures and operating costs to rise. Recently announced tariffs and any further tariffs may also increase our operating costs. Sustained levels of inflation and certain other market pressures have caused the U.S. Federal Reserve and other central banks to increase interest rates in 2022 and 2023. Although the U.S. Federal Reserve made cuts to benchmark interest rates in 2024 and recently in September 2025, there is no guarantee that additional cuts will occur. Although the financial health of the oil and gas industry has shown improvement as compared to prior periods, to the extent elevated interest rates and inflation remain, we may experience further cost increases for our operations, including oilfield services, labor costs and equipment. Higher oil and natural gas prices may cause the costs of materials and services to continue to rise. We cannot predict any future trends in the rate of inflation, any subsequent monetary policy changes, and a significant increase in inflation, to the extent we are unable to recover higher costs through higher oil and natural gas prices and revenues, would negatively impact our business, financial condition and results of operations. See Part I, Item 1A. Risk Factors—"Risks related to the oil and natural gas industry—Inflationary issues and associated changes in monetary policy previously have resulted in and such issues, as well as certain proposed tariffs, may in the future result in additional increases to the cost of our goods, services and personnel, which in turn could cause our capital expenditures and operating costs to rise" in our Annual Report.

Current wording

Due to the cyclical nature of the oil and gas industry, fluctuating demand for oilfield goods and services can put pressure on the pricing structure within our industry. As commodity prices rise, the cost of oilfield goods and services generally also increase, while during periods of commodity price declines, oilfield costs typically lag and do not adjust downward as fast as oil prices do. The U.S. inflation rate remained relatively stable through 2024, 2025 and thus far through 2026, after an extended period of elevation; however, the full impact of recent geopolitical actions (including the conflict in Iran) on inflation cannot be fully determined at this time. Inflationary pressures have resulted in and may result in additional increases to the costs of our oilfield goods, services and personnel, which in turn cause our capital expenditures and operating costs to rise. Recently announced tariffs and any further tariffs may also increase our operating costs. Although the U.S. Federal Reserve made cuts to benchmark interest rates in 2024 and 2025, the Federal Reserve’s Board of Governors has, so far in 2026, kept rates steady and indicated that near-term cuts are unlikely. Although the financial health of the oil and gas industry has shown improvement as compared to prior periods, to the extent elevated interest rates and inflation remain, we may experience further cost increases for our operations, including oilfield services, labor costs and equipment. Higher oil and natural gas prices may cause the costs of materials and services to continue to rise. We cannot predict any future trends in the rate of inflation, any subsequent monetary policy changes (including as a result of changes to the composition of the Federal Reserve’s Board of Governors expected in 2026), and a significant increase in inflation, to the extent we are unable to recover higher costs through higher oil and natural gas prices and revenues, would negatively impact our business, financial condition and results of operations. See Part I, Item 1A. Risk Factors—"Risks related to the oil and natural gas industry—Inflationary issues and associated changes in monetary policy previously have resulted in and such issues, as well as certain proposed tariffs, may in the future result in additional increases to the cost of our goods, services and personnel, which in turn cause our capital expenditures and operating costs to rise" in our Annual Report.

Previous wording

In July 2025, we issued $600.0 million aggregate principal amount of 8.375% senior notes due 2034 (the "2034 Notes") at par (the “2034 Notes Offering”). The 2034 Notes bear interest at an annual rate of 8.375%, which is payable on January 15 and July 15 of each year, and mature on January 15, 2034. The proceeds from the 2034 Notes Offering were approximately $588.1 million after deducting the initial purchasers' discount and offering expenses. We used the net proceeds to finance the consideration of the Tender Offer, the 2028 Notes Redemption and to repay a portion of our outstanding balance under our Revolving Credit Facility.

Current wording

In March 2026, we issued $690.0 million aggregate principal amount of 2.750% Convertible Senior Notes due 2031 (the “2031 Convertible Notes”) at par. The 2031 Convertible Notes bear interest at an annual rate of 2.750%, which is payable on March 15 and September 15 of each year, beginning on September 15, 2026, and mature on March 15, 2031, unless earlier converted or redeemed or purchased by the Company. The net proceeds of the 2031 Convertible Notes were approximately $671.0 million after deducting the initial purchasers' discount and offering expenses. The net proceeds of the 2031 Convertible Notes were used in part to redeem all of our outstanding 2028 Notes (as defined below) as discussed below.

Previous wording

On July 30, 2024, we consummated the SilverBow Merger. See NOTE 3 – Acquisitions and Divestitures included in Part I. Item 1. Financial Statements of this Quarterly Report. Immediately following the SilverBow Merger, Crescent Energy Company completed a series of internal transactions following which the assets of SilverBow Resources, Inc. ("SilverBow") and its subsidiary became held by subsidiaries of Crescent Energy Finance LLC. In connection with the SilverBow Merger, Crescent issued 51.6 million shares of Class A Common Stock and paid $382.4 million in cash to former SilverBow shareholders, including amounts payable in respect of outstanding SilverBow equity awards. In connection with the closing of the SilverBow Merger, we repaid all of SilverBow’s outstanding indebtedness.

Current wording

In December 2025, we consummated the Vital Energy Merger. Immediately following the Vital Energy Merger, the Company completed a series of internal transactions following which the assets of Vital and its subsidiary became held by subsidiaries of Crescent Energy Finance LLC. In connection with the Vital Energy Merger, Crescent issued 73.3 million shares of Class A Common Stock and paid $3.7 million in cash to settle outstanding Vital equity awards. In connection with the closing of the Vital Energy Merger, we repaid outstanding borrowings of $890.0 million and terminated the Vital revolving credit facility. See NOTE 3 – Acquisitions and Divestituresfor additional information.

Previous wording

On December 3, 2024, we entered into the Membership Interest Purchase Agreement (the “Ridgemar Acquisition Agreement”) pursuant to which we acquired all of the outstanding equity interests in Ridgemar (Eagle Ford) LLC (“Ridgemar”). On January 31, 2025, we acquired all of the outstanding equity interests in Ridgemar (Eagle Ford) LLC ("Ridgemar") for $807.2 million in cash and 5.5 million shares of our Class A Common Stock (the "Ridgemar Acquisition"). In addition, up to $170.0 million in contingent earn-out consideration may be paid in fiscal years 2026 and 2027 if quarterly NYMEX WTI prices of crude oil are above certain thresholds in 2026 and 2027 (collectively, the "Ridgemar Contingent Consideration”). We accounted for the Ridgemar Acquisition as an asset acquisition.

Current wording

On January 31, 2025, we acquired all of the outstanding equity interests in Ridgemar (Eagle Ford) LLC ("Ridgemar") for $807.2 million in cash and 5.5 million shares of our Class A Common Stock (the "Ridgemar Acquisition"). In addition, up to $170.0 million in contingent earn-out consideration may be paid in fiscal years 2026 and 2027 if quarterly NYMEX WTI prices of crude oil are above certain thresholds in 2026 and 2027 (collectively, the "Ridgemar Contingent Consideration”). We accounted for the Ridgemar Acquisition as an asset acquisition. See NOTE 3 – Acquisitions and Divestituresfor additional information.

Previous wording

In February 2024, we acquired a portfolio of oil and natural gas mineral interests located in the Karnes Trough of the Eagle Ford Basin from an unrelated third-party (the "Eagle Ford Minerals Acquisition") for total cash consideration of approximately $25.0 million, including customary purchase price adjustments. The purchase price was funded using borrowings from our Revolving Credit Facility.

Current wording

In July 2025, we acquired a portfolio of oil and natural gas mineral interests located in various U.S. oil and gas basins from an unrelated third-party for total cash consideration of approximately $67.9 million, including transaction costs and certain customary purchase price adjustments (collectively with the 2026 Minerals Acquisitions, the "Minerals Acquisitions").

Previous wording

During the nine months ended September 30, 2024, we sold non-core assets to unrelated third-party buyers for $29.7 million in aggregate net cash proceeds and recorded a gain on the sale of assets of $19.4 million.

Current wording

During the three months ended March 31, 2025, we sold non-core assets to unrelated third-party buyers for $6.9 million in aggregate net cash proceeds and recorded a gain on the sale of assets of $10.9 million.

Previous wording

We are members of the Oil & Gas Methane Partnership 2.0 Initiative, or OGMP 2.0, and received Gold Standard pathway ratings in 2022, 2023 and 2024 for our credible plan to more accurately measure our methane emissions. OGMP 2.0 is the United Nations Environment Programme's flagship oil and gas reporting and mitigation program and the leading industry standard for methane emissions reporting. We also established a Sustainability Advisory Council, an outside council comprising leading experts across key sustainability topics, to advise management and our Board of Directors on sustainability-related issues. See additional materials on our website at www.crescentenergyco.com/sustainability. The sustainability-related information found and/or provided in the Company’s sustainability reports or on the Company’s website in general is not intended or deemed to be incorporated by reference in this Quarterly Report.

Current wording

We are members of the Oil & Gas Methane Partnership 2.0 Initiative, or OGMP 2.0, and in 2025, following consecutive years on OGMP 2.0 Gold Standard pathway, we achieved the OGMP 2.0 Gold Standard Reporting designation for our credible plan to more accurately measure our methane emissions. OGMP 2.0 is the United Nations Environment Programme's flagship oil and gas reporting and mitigation program and the leading industry standard for methane emissions reporting. We previously established a Sustainability Advisory Council, an outside council comprising leading experts across key sustainability topics, to advise management and our Board of Directors on sustainability-related issues. See additional materials on our website at www.crescentenergyco.com/sustainability. However, please note that the contents and other materials on our website in general are not intended or deemed to be incorporated by reference in this Quarterly Report.

Previous wording

Crescent Energy Company has a management agreement (the "Management Agreement") with KKR Energy Assets Manager LLC (the "Manager"). Pursuant to the Management Agreement, the Manager provides the Company with members of its executive management team and certain management services. The Management Agreement has a term of three years, with automatic three-year renewals, unless the Company or the Manager elects not to renew the Management Agreement. The current term automatically renewed in December 2024 for an additional three-year term ending December 7, 2027.

Current wording

Crescent Energy Company has a management agreement (the "Management Agreement") with KKR Energy Assets Manager LLC (the "Manager"). Pursuant to the Management Agreement, the Manager provides the Company with members of its executive management team and certain management services. The Management Agreement has a term of three years, with automatic three-year renewals, unless the Company or the Manager elects not to renew the Management Agreement. The current term automatically renewed in December 2024 for an additional three-year term ending December 7, 2027 and will have automatic three-year renewals thereafter, unless the Company or the Manager elects not to renew the Management Agreement.

Previous wording

As consideration for the services rendered pursuant to the Management Agreement and the Manager’s overhead, including compensation of members of its executive management team, the Manager is entitled to receive compensation from the Company equal to $69.5 million per annum ("Manager Compensation"), which is included in General and administrative expenses on our condensed consolidated statements of operations. As the Company's business and assets expand, Manager Compensation will increase by an amount equal to 1.5% per annum of the net proceeds from all future issuances of our primary equity securities by the Company (including in connection with acquisitions). See NOTE 3 – Acquisitions and Divestitures included in Part I. Item 1. Financial Statements of this Quarterly Report for more information.

Current wording

As consideration for the services rendered pursuant to the Management Agreement and the Manager’s overhead, including compensation of members of its executive management team, the Manager is entitled to receive compensation from the Company equal to $78.5 million per annum ("Manager Compensation"), as of March 31, 2026, which is included in General and administrative expenses on our condensed consolidated statements of operations. As the Company's business and assets expand, Manager Compensation will increase by an amount equal to 1.5% per annum of the net proceeds from all future issuances of our primary equity securities by the Company (including in connection with acquisitions). See NOTE 3 – Acquisitions and Divestitures included in Part I. Item 1. Financial Statements of this Quarterly Report for more information.

Previous wording

Additionally, the Manager is entitled to receive incentive compensation ("Incentive Compensation") under which the Manager is targeted to receive 10% of our outstanding Class A Common Stock based on the achievement of certain performance-based measures. The Incentive Compensation consists of five tranches that settle over a five-year period beginning in 2024, and each tranche relates to a target number of shares of Class A Common Stock equal to 2% of the outstanding Class A Common Stock as of the time such tranche is settled. Performance goals are evaluated on absolute stock price performance and relative stock price performance versus a set of our peers and there is no vesting based solely on time. The certification of the Company's level of achievement with respect to the first three-year-performance period under the Incentive Compensation is in process and is expected to be completed in 2025. Based on the level of achievement with respect to the performance goals applicable to such tranche, the Manager is entitled to the settlement of such tranche with respect to a number of shares of Class A Common Stock ranging from 0% to 4.8% of the outstanding Class A Common Stock at the time each tranche is settled so long as the Manager continuously provides services to us through the end of the performance period applicable to a tranche. Accordingly, as our Class A Common Stock share count increases, the number of equity-classified Manager PSU target Class A Shares granted under the Crescent Energy Company 2021 Manager Incentive Plan increases.

Current wording

Additionally, the Manager is entitled to receive Incentive Compensation under which the Manager is targeted to receive Class A Common Stock based on the achievement of certain performance-based measures. Initially, the Incentive Compensation consisted of five tranches, each of which featured a separate three-year performance period and relates to a target number of shares of Class A Common Stock equal to 2% of the outstanding Class A Common Stock as of the time such tranche is settled (each, a "Target PSU"). The first two tranches have vested and were fully expensed as of December 31, 2025. So long as the Manager continuously provides services to us until the end of the performance period applicable to a tranche, the Manager is entitled to settlement of such tranche with respect to a number of shares of Class A Common Stock ranging from 0% to 4.8% of the outstanding Class A Common Stock at the time each tranche is settled. Accordingly, as our Class A Common Stock share count increases, the number of equity-classified Manager PSU target Class A Shares granted under the Crescent Energy Company 2021 Manager Incentive Plan increases.

Previous wording

In addition, revenue from our midstream assets is supported by commercial agreements that have established minimum volume commitments. These midstream revenues, as well as revenue associated with crude oil blending, comprise the majority of our midstream and other revenue. Midstream and other revenue accounts for 5% or less of our total revenues for the three and nine months ended September 30, 2025 and 2024.

Current wording

In addition, revenue from our midstream assets is supported by commercial agreements that have established minimum volume commitments. These midstream revenues, as well as revenue associated with crude oil blending, comprise the majority of our midstream and other revenue. Midstream and other revenue accounts for 4% or less of our total revenues for the three months ended March 31, 2026 and 2025.

Previous wording

The oil and natural gas industry is cyclical and commodity prices can be highly volatile. In recent years, commodity prices have been subject to significant fluctuations, either as a result of the geopolitical events, such as Russia’s invasion of Ukraine and the associated sanctions imposed on Russia, and the Israel-Hamas conflict and the broader conflict in the Middle East, including with Iran, actions taken by OPEC, sustained elevated inflation, U.S. trade policy and the imposition of tariffs and increased U.S. drilling activity or otherwise. Uncertainty persists regarding OPEC’s actions, overall U.S. drilling activity, the imposition of increased tariffs and resulting consequences, inflation and the armed conflicts in Ukraine and the Middle East. Additionally, market concern regarding a potential recession, among other factors, contributes to increased volatility in the price for oil and natural gas.

Current wording

The oil and natural gas industry is cyclical and commodity prices can be highly volatile. In recent years, commodity prices have been subject to significant fluctuations, either as a result of the geopolitical events, such as the recent events in Venezuela, and expected increase in Venezuelan crude being brought to market, Russia’s invasion of Ukraine and the associated sanctions imposed on Russia, the Israel-Hamas conflict and the broader conflict in the Middle East, including the conflict with Iran and the disruption of shipments of crude oil and liquefied natural gas through the Strait of Hormuz, actions taken by OPEC, sustained levels of inflation and increased U.S. drilling activity or otherwise. Uncertainty persists regarding OPEC’s actions, increased U.S. drilling, proposed tariffs, inflation and the armed conflicts in Ukraine and the Middle East, including with Iran and the potential for related supply disruptions and ongoing hostilities in Venezuela. Additionally, market concern regarding the health of the global banking sector and any resultant recessionary effects contributed, among other factors, to increased volatility in the price for oil and natural gas.

Previous wording

(1)The realized price presented above does not include $14.7 million or $49.6 million received from the settlement of acquired oil, gas and NGL derivative contracts for the three and nine months ended September 30, 2025, respectively, and does not include $26.3 million received from the settlement of acquired oil, gas and NGL derivative contracts for the three and nine months ended September 30, 2024.

Current wording

(1)The realized price presented above does not include $60.6 million received from the settlement of acquired oil, gas and NGL derivative contracts for the three months ended March 31, 2026, and does not include $17.9 million received from the settlement of acquired oil, gas and NGL derivative contracts for the three months ended March 31, 2025.

Previous wording

Oil revenue. Oil revenue increased $47.9 million, or 9%, in the three months ended September 30, 2025, compared to the three months ended September 30, 2024. This was driven by a $105.7 million increase from higher sales volume (17 MBbls/d, or 20%), partially offset by lower realized oil prices that resulted in a decrease of $57.8 million (a decrease of 9% per Bbl). The increase in sales volumes was primarily driven by the SilverBow Merger and the Ridgemar Acquisition. The decrease in realized oil prices was due to lower index prices partially offset by more favorable price differentials.

Current wording

Oil revenue. Oil revenue increased $273.7 million, or 44%, in the three months ended March 31, 2026, compared to the three months ended March 31, 2025. This was driven by a $231.4 million increase from higher sales volume (38 MBbls/d, or 37%), and higher realized oil prices that resulted in an increase of $42.3 million (an increase of 5% per Bbl). The increase in sales volumes was primarily driven by the Vital Energy Merger. The increase in realized oil prices was due to higher index pricing and more favorable price differentials.

Previous wording

Natural gas revenue. Natural gas revenue increased $65.7 million, or 83%, in the three months ended September 30, 2025, compared to the three months ended September 30, 2024. This was driven by higher natural gas prices that resulted in an increase of $54.7 million (an increase of 61% per Mcf) and a $11.0 million increase from higher sales volume (77 MMcf/d, or 14%). The increase in sales volumes was primarily due to the SilverBow Merger and the Ridgemar Acquisition. The increase in realized natural gas prices was due to higher index prices.

Current wording

Natural gas revenue. Natural gas revenue decreased $29.1 million, or 16%, in the three months ended March 31, 2026, compared to the three months ended March 31, 2025. This was driven by lower natural gas prices that resulted in a decrease of $54.2 million (a decrease of 25% per Mcf), partially offset by a $25.1 million increase from higher sales volume (88 MMcf/d, or 13%). The increase in sales volumes was primarily due to the Vital Energy Merger. The decrease in realized natural gas prices was due to a decrease in our price differentials due to the Vital Energy Merger and resulting differentials in the Permian Basin.

Previous wording

NGL revenue. NGL revenue increased $5.3 million, or 6%, in the three months ended September 30, 2025, compared to the three months ended September 30, 2024. This was driven primarily by a $9.4 million increase from higher sales volume (5 MBbls/d, or 13%), partially offset by lower realized NGL prices that resulted in a decrease of $4.1 million (a decrease of 4% per Bbl). The increase in sales volumes was primarily driven by the SilverBow Merger and more gas related drilling.

Current wording

NGL revenue. NGL revenue increased $17.5 million, or 16%, in the three months ended March 31, 2026, compared to the three months ended March 31, 2025. This was driven primarily by a $68.7 million increase from higher sales volume (30 MBbls/d, or 64%), partially offset by lower realized NGL prices that resulted in a decrease of $51.2 million (a decrease of 29% per Bbl). The increase in sales volumes was primarily driven by the Vital Energy Merger.

Previous wording

Operating expense. Operating expense increased $60.3 million, or 18%, in the three months ended September 30, 2025, compared to the three months ended September 30, 2024, driven primarily by the following factors:

Current wording

Operating expense. Operating expense increased $25.5 million, or 6%, in the three months ended March 31, 2026, compared to the three months ended March 31, 2025, driven primarily by the following factors:

Previous wording

(i)Lease and Asset operating expense increased $33.8 million, or 22%, in the three months ended September 30, 2025, compared to the three months ended September 30, 2024, and increased $0.43 per Boe, or 6%, to $8.05 per Boe. This $33.8 million increase was driven primarily by higher production from the SilverBow Merger and the Ridgemar Acquisition, which was more than offset on a per Boe basis with the additional acquired volumes and cost reduction measures on our legacy assets.

Current wording

(i)Lease and asset operating expense increased $42.2 million, or 22%, in the three months ended March 31, 2026, compared to the three months ended March 31, 2025, and decreased $0.63 per Boe, or 8%, to $7.64 per Boe. This $42.2 million increase was driven primarily by higher production from the Vital Energy Merger, which was more than offset on a per Boe basis with the additional acquired volumes and 2025 divestitures.

Previous wording

(iv)Workover expense increased $7.8 million, or 51%, in the three months ended September 30, 2025, compared to the three months ended September 30, 2024, and increased $0.23 per Boe, or 30%, to $0.99 per Boe. This increase was primarily driven by the SilverBow Merger and the Ridgemar Acquisition.

Current wording

(iv)Workover expense increased $14.3 million, or 89%, in the three months ended March 31, 2026, compared to the three months ended March 31, 2025, and increased $0.30 per Boe, or 43%, to $0.99 per Boe. This increase was primarily driven by the Vital Energy Merger.

Previous wording

Depreciation, depletion and amortization. In the three months ended September 30, 2025, depreciation, depletion and amortization increased $47.0 million, or 19%, compared to the three months ended September 30, 2024, driven primarily by increased production from the SilverBow Merger and the Ridgemar Acquisition.

Current wording

Depreciation, depletion and amortization. In the three months ended March 31, 2026, depreciation, depletion and amortization increased $71.6 million, or 25%, compared to the three months ended March 31, 2025, driven primarily by increased production from the Vital Energy Merger.

Previous wording

Impairment expense. During the three months ended September 30, 2025, we recorded an impairment of $73.5 million to write down the value of certain assets classified as held for sale to expected net proceeds.

Current wording

Impairment expense. During the three months ended March 31, 2025, we recorded an impairment of $45.6 million to write down the value of certain assets classified as held for sale to expected net proceeds. We did not have impairment expense during the three months ended March 31, 2026.

Previous wording

General and administrative expense. General and administrative expense ("G&A") increased $6.1 million, or 2%, for the nine months ended September 30, 2025, compared to the nine months ended September 30, 2024. The increase was driven by (i) higher recurring G&A due to the SilverBow Merger and the Ridgemar Acquisition and (ii) an increase in equity-based compensation expense of $5.3 million (2025 and 2024 include an additional true-up expense of $77.9 million and $85.5 million, respectively, due to change in estimate), partially offset by $39.5 million lower transaction and nonrecurring related expenses.

Current wording

General and administrative expense. General and administrative expense increased $6.0 million, or 11%, for the three months ended March 31, 2026, compared to the three months ended March 31, 2025. The increase was driven by (i) higher recurring General and administrative expense due to an increase in Manager Compensation as a result of the Vital Energy Merger and (ii)

Previous wording

Other operating costs. Other operating costs include exploration expense and gain on sale of assets. Other operating costs decreased by $11.9 million, compared to the three months ended September 30, 2024, primarily driven by $13.5 million lower exploration expense recognized during the three months ended September 30, 2025, partially offset by a $1.6 million higher loss on sale of assets.

Current wording

Other operating costs. Other operating costs include exploration expense and gain on sale of assets. Other operating costs increased by $20.0 million, compared to the three months ended March 31, 2025, primarily driven by $6.3 million higher exploration expense recognized during the three months ended March 31, 2026 and a $13.7 million change in the gain or loss on sale of assets.

Previous wording

Interest expense. In the three months ended September 30, 2025, we incurred interest expense of $72.6 million, as compared to $61.8 million in the three months ended September 30, 2024, a 17% increase. This increase was driven primarily by higher average debt balances driven by the Ridgemar Acquisition.

Current wording

Interest expense. In the three months ended March 31, 2026, we incurred interest expense of $104.6 million, as compared to $73.2 million in the three months ended March 31, 2025, a 43% increase. This increase was driven primarily by higher average debt balances from the Vital Energy Merger.

Previous wording

Loss on extinguishment of debt. During the three months ended September 30, 2025, we incurred a loss on extinguishment of debt of $29.2 million related to $22.3 million premium for the Tender Offer and Redemption of the 2028 Notes and $6.9 million related to the write-off of outstanding deferred finance costs related to the 2028 Notes. During the three months ended September 30, 2024, we incurred a loss on the extinguishment of debt related to the make whole provision and premium related to the repayment of SilverBow’s Second Lien Notes due 2028 of $36.5 million.

Current wording

Loss on extinguishment of debt. During the three months ended March 31, 2026, we incurred a loss on extinguishment of debt of $17.4 million related to $12.0 million premium for the 2028 Notes Redemption and our repurchases of the 2029 Notes, and $5.4 million related to the non-cash write-off of outstanding deferred financing costs, discounts, and premiums. During the three months ended March 31, 2025, we did not incur a loss on the extinguishment of debt.

Previous wording

Gain (loss) on derivatives. We have entered into derivative contracts to manage our exposure to commodity price risks that impact our revenues and have derivative gains and losses related to our contingent earn-out consideration. Our gain on derivatives during the three months ended September 30, 2025 changed by $41.2 million primarily due to changes in commodity prices relative to our strike price.

Current wording

Gain (loss) on derivatives. We have entered into derivative contracts to manage our exposure to commodity price risks that impact our revenues and have derivative gains and losses related to our contingent earn-out consideration. Our loss on derivatives during the three months ended March 31, 2026 changed by $615.6 million, from a comparable loss during 2025 primarily due to changes in commodity prices relative to our strike price.

Previous wording

Income tax benefit (expense). We are a corporation that is subject to U.S. federal and state income taxes on our allocable share of any taxable income from OpCo. OpCo is a partnership and is generally not subject to U.S. federal and certain state taxes. For the three months ended September 30, 2025 and 2024, we recognized income tax benefit of $4.0 million and tax benefit of$1.6 million, respectively, for an effective tax rate of 28.2% and 22.7%, respectively. Historically, our effective tax rate has been lower than the U.S. federal statutory income tax rate of 21% primarily due to effects of removing income and losses related to our noncontrolling interests and redeemable noncontrolling interests. However, as part of our Corporate Simplification, we expect our effective rate to be more in line with the U.S. federal statutory income tax rate plus our blended state income tax rate. Our effective tax rate for the three months ended September 30, 2025 was driven higher primarily due to our increased ownership of OpCo in 2025.

Current wording

Income tax benefit (expense). We are a corporation that is subject to U.S. federal and state income taxes on our allocable share of any taxable income from OpCo. OpCo is a partnership and is generally not subject to U.S. federal and certain state taxes. For the three months ended March 31, 2026 and 2025, we recognized income tax benefit of $82.3 million and tax expense of$2.6 million, respectively, for an effective tax rate of 16.4% and 30.7%, respectively. Our effective tax rate for the three months ended March 31, 2026 was lower primarily due to the permanent difference recognized in conjunction with the performance stock units granted to our Manager ("Manager PSUs") that vested during the three months ended March 31, 2026. Our effective tax rate for the three months ended March 31, 2025 was higher due to temporary timing differences of certain deductions and a higher state tax rate due to the apportionment changes created by the Ridgemar Acquisition.

Previous wording

Adjusted EBITDAX (non-GAAP) increased by $56.1 million, or 13%, in the three months ended September 30, 2025, compared to the three months ended September 30, 2024, primarily driven by additional production generated by the SilverBow Merger and the Ridgemar Acquisition.

Current wording

Adjusted EBITDAX (non-GAAP) increased by $160.3 million, or 30%, in the three months ended March 31, 2026, compared to the three months ended March 31, 2025, primarily driven by additional production from the Vital Energy Merger.

Previous wording

Levered Free Cash Flow (non-GAAP) increased by $46.8 million, or 30%, in the three months ended September 30, 2025 compared to the three months ended September 30, 2024, primarily driven by increased Adjusted EBITDAX, partially offset by additional interest expense and the loss from extinguishment of debt.

Current wording

Levered Free Cash Flow (non-GAAP) decreased by $49.7 million, or 21%, in the three months ended March 31, 2026 compared to the three months ended March 31, 2025, primarily driven by $177.2 million of increased development of oil and natural gas properties expenditures and additional interest expense, excluding non-cash amortization and the loss from extinguishment of debt, partially offset by increased Adjusted EBITDAX.

Previous wording

Our primary sources of liquidity are cash flow from operations, proceeds from equity and debt offerings and borrowings under a senior secured reserve-based revolving credit agreement (as amended, restated, amended and restated or otherwise modified to date, the “Revolving Credit Facility”) with Wells Fargo Bank, N.A., as administrative agent for the lenders and letter of credit issuer, and the lenders from time to time party thereto. Our primary expected uses of capital are for debt repayment, dividends to shareholders, development of our existing assets and acquisitions, and our share repurchase program.

Current wording

Our primary sources of liquidity are cash flow from operations, proceeds from equity and debt offerings and borrowings under our senior secured reserve-based revolving credit agreements. Our primary expected uses of capital are for dividends to shareholders, our share repurchase program, debt repayment, including open market repurchases of our Senior Notes, development of our existing assets and acquisitions.

Previous wording

We plan to continue our practice of entering into economic hedging arrangements to reduce the impact of the near-term volatility of commodity prices and the resulting impact on our cash flow from operations. A key tenet of our focused risk management efforts is an active economic hedge strategy to mitigate near-term price volatility while maintaining long-term exposure to underlying commodity prices. Our commodity derivative program focuses on entering into forward commodity contracts when investment decisions regarding reinvestment in existing assets or new acquisitions are finalized, targeting economic hedges for a portion of expected production generated by the capital investment as well as adding incremental derivatives to our production base over time. Our active derivative program allows us to protect margins and corporate returns, and to maintain a strong balance sheet through commodity cycles.

Current wording

We plan to continue our practice of entering into economic hedging arrangements to reduce the impact of the near-term volatility of commodity prices and the resulting impact on our cash flow from operations. A key tenet of our focused risk management efforts is an active economic hedge strategy to mitigate near-term price volatility while maintaining long-term exposure to underlying commodity prices. Our commodity derivative program focuses on entering into forward commodity contracts when investment decisions regarding reinvestment in existing assets or new acquisitions are finalized, targeting economic hedges for a portion of expected production generated by the capital investment as well as adding incremental derivatives to our production base over time. Our active derivative program allows us to protect margins and corporate returns through commodity cycles.

Previous wording

In connection with the closing of the Ridgemar Acquisition in the first quarter of 2025, we paid in total $807.2 million in cash after customary purchase price adjustments. We funded the cash to close, less the initial deposit, with cash on hand and borrowings under our Revolving Credit Facility. Based on our planned capital spending, our forecasted cash flows and projected levels of indebtedness, we expect to maintain compliance with the covenants under our debt agreements. Further, based on current market indications, we expect to meet in the ordinary course of business other contractual cash commitments to third parties pursuant to the various agreements described under the heading “Contractual obligations” in our Annual Report, recognizing we may be required to meet such commitments even if our business plan assumptions were to change.

Current wording

Based on our planned capital spending, our forecasted cash flows and projected levels of indebtedness, we expect to maintain compliance with the covenants under our debt agreements. Further, based on current market indications, we expect to meet in the ordinary course of business other contractual cash commitments to third parties pursuant to the various agreements described under the heading “Contractual obligations” in our Annual Report, recognizing we may be required to meet such commitments even if our business plan assumptions were to change.

Previous wording

Net cash provided by operating activities. Net cash provided by operating activities for the nine months ended September 30, 2025 increased by $470.5 million, or 56%, compared to the nine months ended September 30, 2024 primarily due to higher net income after adjusting for non-cash items and working capital changes.

Current wording

Net cash provided by operating activities. Net cash provided by operating activities for the three months ended March 31, 2026 increased by $72.1 million, or 21%, compared to the three months ended March 31, 2025 primarily due to higher net income after adjusting for non-cash items.

Previous wording

Net cash used in investing activities. Net cash used in investing activities for the nine months ended March 31, 2025 increased by $684.7 million, or a 82%, compared to the nine months ended September 30, 2024, primarily due to $554.7 million of additional acquisitions of oil and natural gas properties in 2025 due to the cash consideration for the Ridgemar Acquisition and $223.8 million additional cash used in our development capital expenditures.

Current wording

Net cash used in investing activities. Net cash used in investing activities for the three months ended March 31, 2026 decreased by $375.3 million, or 36%, compared to the three months ended March 31, 2025, primarily due to $512.9 million lower acquisitions of oil and natural gas properties in 2026 partially offset by $121.2 million additional cash used in our development capital expenditures.

Previous wording

Net cash used in financing activities. Net cash used in financing activities for the nine months ended September 30, 2025 was $7.6 million, primarily a result of our Class A Common Stock dividend, repurchases of Class A Common Stock and cash distributions to our redeemable noncontrolling interests; partially offset by net cash received in our debt transactions and Revolving Credit Facility borrowings. Net cash provided by financing activities for the nine months ended September 30, 2024 was $165.1 million, driven primarily a result of net cash received in our debt transactions, partially offset by the repurchase of OpCo Units, our redeemable noncontrolling interests distributions and our Class A Common Stock dividend.

Current wording

Net cash provided by (used in) financing activities. Net cash used in financing activities for the three months ended March 31, 2026 was $448.2 million, primarily a result of net repayments of our long-term debt balances. Net cash provided by financing activities for the three months ended March 31, 2025 was $502.7 million, primarily a result of net cash received in Revolving Credit Facility borrowings, partially offset by our dividend payments and cash distributions to our redeemable noncontrolling interests.

Previous wording

In connection with the issuance of the 2026 Notes in May 2021, Crescent Energy Finance LLC entered into the Revolving Credit Facility. The Revolving Credit Facility matures on April 10, 2029. At September 30, 2025, our elected commitment amount was approximately $2.0 billion and we had $72.0 million of outstanding borrowings, $17.9 million in outstanding letters of credit and approximately $1.9 billion of availability under the Revolving Credit Facility.

Current wording

We are party to a Revolving Credit Facility with Wells Fargo Bank, N.A., as administrative agent for the lenders and letter of credit issuer, and the lenders from time to time party thereto. The Revolving Credit Facility matures on October 22, 2030. The borrowing base under the Revolving Credit Facility was $3.9 billion as of March 31, 2026 and December 31, 2025. At March 31, 2026, our elected commitment amount was approximately $2.0 billion and we had no outstanding borrowings, $16.6 million in outstanding letters of credit and approximately $2.0 billion of available borrowings.