Gazprom: revenue nearly flat, but profit fell 45.9% on FX losses

On May 29, 2026, Gazprom released its Q1 2026 results: revenue fell 0.3% YoY to RUB 2,799,209 million, EBITDA rose 17.5% to RUB 977,548 million, and net profit dropped 45.9% to RUB 375,655 million. The review shows that operationally the report is strong, but the financial line offset the effect.

Key takeaways

— Revenue nearly flat, but gas business lost RUB 51.3 billion due to lower export prices

— EBITDA up 17.5% as operating costs grew slower than revenue

— Net profit down 45.9% on negative FX differences in finance income

— Debt up RUB 543.1 billion over 12 months, but Net Debt/EBITDA stays at 2.25

— Capex up 7.7% in Q1, but operating cash flow covered it with a buffer

— No dividends paid over the last 12 months; model expects zero payouts going forward

— Shares down 28.1% after the report despite strong operating metrics

Key figures, RUB bn

Revenue nearly flat, but gas business lost RUB 51.3 billion due to lower export prices

In Q1 2026, Gazprom's revenue amounted to RUB 2,799,209 million, down 0.3% YoY. The gas segment was the main drag: its external revenue fell RUB 46,086 million YoY to RUB 1,639,771 million. Gas sales revenue dropped RUB 51,349 million to RUB 1,202,585 million, driven by lower export prices: sales outside Russia fell RUB 224,517 million to RUB 778,715 million, while domestic revenue rose RUB 104,740 million to RUB 600,218 million.

The oil segment also declined: external revenue fell RUB 22,114 million to RUB 851,358 million due to lower oil and oil product prices. In contrast, the power segment grew RUB 55,349 million to RUB 269,450 million, and media added RUB 3,368 million to RUB 38,630 million. Overall revenue was nearly flat, but the mix shifted notably toward the domestic market.

EBITDA up 17.5% as operating costs grew slower than revenue

EBITDA for Q1 2026 stood at RUB 977,548 million, up 17.5% YoY. EBITDA margin expanded from 29.6% to 34.9%. Operating profit rose 27.1% to RUB 609,799 million, with all segments except media showing growth: gas profit increased RUB 96,843 million to RUB 429,125 million, oil rose RUB 68,623 million to RUB 136,400 million, and power posted RUB 49,130 million versus a loss a year earlier.

Revenue down 0.3% with EBITDA up 17.5% implies operating costs grew slower than revenue. The report shows depreciation rose RUB 15,329 million to RUB 367,749 million, but that did not prevent margin expansion. The main driver of EBITDA growth was likely lower purchase prices for gas and oil, as well as the effect of a weaker ruble, but the exact cost structure is not disclosed in the report.

Net profit down 45.9% on negative FX differences in finance income

Net profit for Q1 2026 was RUB 375,655 million, down 45.9% YoY. The reason lies in finance income: it fell from RUB 604,535 million to RUB 128,708 million. Last year this line included positive FX differences; this year they were negative, as seen in the statement of comprehensive income. Finance costs rose RUB 45,269 million to RUB 189,206 million, also reducing pre-tax profit.

Pre-tax profit fell from RUB 988,095 million to RUB 594,992 million. Net margin dropped from 24.7% to 13.4%. Operationally the company earned more, but FX revaluation of debt and loans consumed a significant part of the result. Excluding FX differences, profit would have been much higher, but such items are volatile and depend on the ruble exchange rate.

Debt up RUB 543.1 billion over 12 months, but Net Debt/EBITDA stays at 2.25

Net debt at the end of Q1 2026 stood at RUB 7,740,931 million, up RUB 543.1 billion from a year earlier. Over the quarter, debt declined RUB 194.0 billion. The Net Debt/EBITDA ratio for the trailing twelve months is 2.25, which is a level, not a direction. The debt burden remains moderate for a company with such cash flow.

The debt structure is dominated by loans (RUB 2,989,878 million) and Russian bonds (RUB 1,589,845 million). A significant portion of borrowings carries floating rates linked to the CBR key rate, creating sensitivity to monetary policy. Nevertheless, operating cash flow for the quarter was RUB 1,027,242 million, covering both interest and capex.

Capex up 7.7% in Q1, but operating cash flow covered it with a buffer

Capex in Q1 2026 amounted to RUB 680,051 million, up 7.7% YoY from RUB 631,413 million in Q1 2025. The bulk went to gas (RUB 328,583 million) and oil (RUB 332,958 million) segments. Operating cash flow rose 8.7% to RUB 1,027,242 million, covering capex with a buffer: free cash flow before interest and taxes is positive.

Over the trailing twelve months, operating cash flow was RUB 2,867,000 million, more than four times quarterly capex. This gives the company room to fund its investment program without a significant rise in debt. However, the report shows Q1 2026 capex was higher than Q4 2025 (RUB 680,051 million vs RUB 631,413 million), which may indicate an acceleration of the investment program.

No dividends paid over the last 12 months; model expects zero payouts going forward

Over the last 12 months, Gazprom paid no dividends: payouts were RUB 0.0 per share. Our model estimates the next payment also at RUB 0.0 per share, implying a zero payout ratio. The fair yield for this stock, in our view, is 12.0%, reflecting the high risk of no payouts.

The absence of dividends is a consequence of sanctions-related restrictions and the need to fund the investment program. For shareholders, this means returns come only from capital appreciation. The report mentions that coupon income on perpetual bonds arises only when a dividend decision is made, indirectly confirming a conservative dividend policy.

Shares down 28.1% after the report despite strong operating metrics

Gazprom's share price before the report was RUB 115.7, rose 0.3% on the release day, but fell 28.1% from the release to August 17, 2026. Current market cap is RUB 1,997,571 million. P/E LTM is 1.94, and EV/EBITDA LTM is 2.81, well below the three-year average of 3.40.

Such low multiples reflect high risks related to sanctions, uncertainty in export markets, and lack of dividends. Investors are likely discounting future cash flows at a high premium. Despite strong Q1 operating results, the market focuses on structural issues such as dependence on the domestic market and limited access to Western technology.

Valuation on the latest reported figures

Bottom line

Gazprom's Q1 2026 was operationally strong: EBITDA rose 17.5%, margin expanded to 34.9%, and operating cash flow covered capex. However, net profit fell 45.9% due to negative FX differences, reminding of the volatility in financial lines. Debt rose over the year but remains at a manageable level. The key question for shareholders is when the company will resume dividends and whether it can sustain margins amid weak export prices. The market currently prices the stock at a discount to its history, reflecting these uncertainties.