(Reuters) -EOG Resources beat fourth-quarter profit estimates on Thursday, as higher production at the oil and gas firm helped offset lower oil prices.

Shares of the company were, however, down 3.5% after market hours as its net income more than halved, falling to $1.25 billion from $1.998 billion in the year-ago quarter.

Overall quarterly revenue fell 12% to $5.59 billion due to the lower oil revenues and losses from derivative contracts.

Operating expenses also rose 3.6% from last year.

But quarterly crude equivalent volumes were up 6.7% at nearly 1.1 million barrels of oil per day (boepd) from the previous year, and the company expects to pump between 1.1 million boepd and 1.14 million boepd in 2025.

Data from the U.S. Energy Information Administration showed that oil production in the country rose to a record in October, as drilling and well efficiencies helped companies put out more oil than before.

The company’s in-house drilling motor program helped lower well costs by 6%, Chief Executive Officer Ezra Yacob said. EOG is also targeting a low single-digit percentage reduction in well costs in the current year.

The Houston, Texas-based company expects total expenditures to be in the range of $6 billion to $6.4 billion. It spent $6.23 billion in 2024.

Roth MKM’s analysts also noted that EOG reported cash flow per share of $4.77, which was 0.5% below the consensus of $4.79 due to higher cash taxes.

It expects to keep steady year-over-year activity levels in the Delaware basin, with a step up in activity in the Utica and Dorado basins.

Last year, it repurchased 25.8 million shares for $3.2 billion, and has $5.8 billion remaining on its current repurchase authorization.

The company reported an adjusted profit of $2.74 per share for the quarter ended December 31, compared with the analysts’ average estimate of $2.57 per share, according to data compiled by LSEG.