Matador Resources (NYSE:MTDR) executives said the company is emphasizing production growth, capital discipline and debt reduction as it navigates what Founder, Chairman and CEO Joe Foran described as one of the more challenging operating environments in his more than 40 years in the industry.
Speaking on the company’s first-quarter 2026 earnings call, Foran said Matador’s key priorities remain straightforward: production is up, capital spending is being held steady or modestly lower, and debt has been reduced. He said the company’s balance sheet is “in the best position” it has had and that Matador is prepared for both challenges and opportunities.
“Presently, we think the emphasis should be on getting production up and your debt down and keeping a handle on your capital spending,” Foran said. He added that Matador aims to spend capital to keep growing, but “not be reckless with it” and to “make each dollar count.”
Management Highlights Measured Growth Strategy
In response to a question from Neal Dingmann of William Blair about production growth, Foran said Matador’s plans are influenced by a range of factors, including commodity price volatility and geopolitical uncertainty. He said the company has historically tried to remain nimble and adjust as business conditions change.
Chris Calvert, Matador’s executive vice president and chief financial officer, said the company believes it has flexibility that some peers may not have. He cited 10 to 15 years of inventory with “extremely good returns,” as well as midstream assets and operational efficiencies that support growth.
Calvert said Matador is focused on “profitable growth at a measured pace,” adding that the company does not view inventory scarcity as a constraint. He also pointed to expected improvement in natural gas takeaway later this year through the Hugh Brinson project, which management said should help reduce exposure to negative Waha pricing.
Asked by Scott Hanold of RBC Capital Markets about the potential to pull forward activity, Calvert said first-quarter production outperformance was helped by stronger-than-expected wells and the acceleration of two additional net wells turned online during the quarter. He said efficiencies could create opportunities to pull additional wells into the year, but that it was too early to make that determination.
San Mateo Remains Strategically Important
Management also discussed San Mateo, Matador’s midstream business, in response to a question from Gabe Daoud of Truist about potential strategic options. Foran said San Mateo has become a valuable asset, not only financially but also because it provides operational flexibility and flow assurance in the Delaware Basin.
Foran said one option previously considered has been taking the midstream business public, but he emphasized that Matador does not need the money and would not pursue a transaction unless conditions were favorable.
“We don’t wanna go out unless it’s a good time,” Foran said. “We don’t need the money.”
Calvert said Matador will continue to evaluate strategic alternatives for San Mateo with a focus on preserving the value of the integrated upstream and midstream business. He said San Mateo and other Matador-owned midstream assets helped supply 30% of the recycled water volumes used by Matador’s exploration and production operations in the first quarter.
Glenn Stetson, Matador’s executive vice president and chief operating officer, said the use of field gas rather than compressed natural gas trucked to hydraulic fracturing locations saves an average of $100,000 per well. He added that, during periods of negative Waha pricing, using gas in the field avoids selling it at negative prices.
Woodford Well Could Add Future Upside
Matador executives also provided an update on the company’s first Woodford well. Calvert said the well had been successfully drilled and cased, with completion operations ongoing. He said the company expects to discuss productivity on the next earnings call in July.
Andrew Parker, executive vice president of geosciences, described the Woodford as a “huge catalyst” for the year and said the land team had done a strong job assembling the position. He said it remains early, but management is encouraged by the position and execution to date.
Tom Elsener, executive vice president of reservoir engineering and senior asset manager, noted that Matador has not currently counted any Woodford locations in its inventory, meaning success there could represent upside.
Capital Spending Expected to Step Down in Second Half
Capital spending was another focus of the call. Calvert said first-quarter capital expenditures of $428 million were in line with expectations, and that the first half of the year is expected to represent roughly 55% to 60% of the full-year budget, consistent with prior messaging.
Looking to the second half, Calvert said spending should decline on a quarterly basis from second-quarter levels. He said more than 50% of the company’s drilling activity is occurring in the first half, which should contribute to the expected step-down. However, he did not provide a specific third- or fourth-quarter cadence.
Calvert also discussed drilling and completion costs, saying Matador’s target range of $785 to $805 per lateral foot is about 6% below 2025 levels. He said the company is working toward the lower end of that range through multi-well completions, simul-frac and trimul-frac operations, electric fleets, water recycling, shorter cycle times, vendor relationships and technology improvements.
Calvert said more than 70% of Matador’s first-quarter water needs came from recycled sources. He also said average cycle times were about 13% faster year over year, and that Matador’s best three-mile lateral well this year was drilled in under 16 days, a 40% improvement from 2025.
AI Use Expanding Across Operations
Management said Matador is increasing its use of artificial intelligence and analytics across production, completions and drilling. Foran said the company is taking a measured approach, using a committee with representation from multiple departments and oversight from the board.
Stetson said Matador brings in more than 40 million data points per day and uses a control room to monitor field operations in real time. He said the goal is to make the data actionable by reducing downtime and identifying inefficiencies quickly.
On drilling, Stetson said Matador set more than 36 records during the quarter across different hole sections and laterals. He said AI is being used to help keep wells in the preferred target zone and improve drilling speed.
Brian J. Willey, executive vice president of midstream, said Matador sees real applications for AI but is taking a methodical approach. “We’re gonna be fast followers on this,” Willey said. “We’re not gonna jump in and make a bunch of mistakes.”
About Matador Resources (NYSE:MTDR)
Matador Resources Company is an independent energy firm primarily engaged in the exploration, development and production of oil, natural gas liquids (NGLs) and natural gas. The company focuses on upstream operations, utilizing horizontal drilling and hydraulic fracturing techniques to unlock hydrocarbons from key reservoirs. Its asset base includes both operated and non‐operated positions, with a particular emphasis on the Permian Basin, one of the most prolific oil-producing regions in North America.
Matador's core operations are concentrated in the Delaware Basin segment of the Permian Basin, where it holds substantial acreage in both Reeves and Culberson counties in West Texas and Eddy and Lea counties in New Mexico.
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