Santos to cut 10% jobs as growth projects near end, annual profit misses estimates

Published Wed, Feb 18, 2026 · 11:33 AM

[BENGALURU] Australian oil and gas producer Santos reported a steeper-than-expected drop in annual profit on Wednesday (Feb 18), hurt by weak commodity prices, and said that it would reduce its headcount by about 10 per cent as major growth projects near completion.

Shares of Australia’s second-largest gas producer slipped as much as 1.8 per cent in early trading, but retraced most of those losses to trade marginally lower as at 0020 GMT.

Chief executive Kevin Gallagher said that, as it delivered on its Barossa LNG offshore project and neared completion of the Pikka phase 1 project in Alaska, its growth projects would transition to the “base business”.

“As these major growth projects come to an end and become a part of the base business, and as we deliver on our cost savings objectives, we are targeting a headcount reduction of around 10 per cent, rightsizing the business.”

Santos employs around 4,028 people, according to its 2025 annual report issued along with the results announcement, implying the layoffs would affect around 400 roles. The gas producer did not provide any further details on the cuts.

“The market should like the targeted 10 per cent headcount reduction as a sign of lower forecast operating costs,” analysts at Jarden said.

The company added that it will prioritise conducting “a strategic review of Australian Integrated Oil and Gas Portfolio” in 2026, which Jarden said, “may imply a potential for (Santos’) Australian asset divestments”.

Underlying earnings for fiscal year 2025 at the oil and gas producer tumbled 25 per cent from the prior year to US$898 million, missing the Visible Alpha consensus of US$904 million by a wide margin.

Weaker commodity prices and a delay in ramping up Barossa LNG due to a technical issue impacted annual earnings.

Santos declared a final dividend of 10.3 US cents per share, in line with the FY24 payout but below the market consensus of 20 US cents. Revenue for fiscal year 2025 fell 8 per cent to US$4.94 billion. REUTERS