ANTERO RESOURCES Corp (AR)

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included elsewhere in this Quarterly Report on Form 10-Q. The following discussion contains “forward-looking statements” that reflect our future plans, estimates, beliefs and expected performance. We caution that assumptions, expectations, projections, intentions or beliefs about future events may, and often do, vary from actual results, and the differences can be material. Some of the key factors that could cause actual results to vary from our expectations include changes in natural gas, NGLs and oil prices, the timing of planned capital expenditures, our ability to fund our development programs, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as our ability to access them, impacts of world health events and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting our business, as well as those factors discussed below, all of which are difficult to predict. In light of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur. See “Cautionary Statement Regarding Forward-Looking Statements.” Also, see the risk factors and other cautionary statements described under the heading “Item 1A. Risk Factors.” We do not undertake any obligation to publicly update any forward-looking statements except as otherwise required by applicable law.

In this section, references to “Antero,” the “Company,” “we,” “us,” and “our” refer to Antero Resources Corporation and its subsidiaries, unless otherwise indicated or the context otherwise requires.

Our Company

We have assembled a portfolio of long-lived properties that are characterized by what we believe to be high repeatability and low geologic risk. We focus on unconventional reservoirs, which can generally be characterized as fractured shale formations. Our management team has worked together for many years and has a successful track record of reserve and production growth as well as significant expertise in unconventional resource plays. Our strategy is to leverage our team’s experience delineating and developing natural gas resource plays to develop our reserves and production, primarily on our existing multi-year inventory of drilling locations in the Appalachian Basin. As of June 30, 2026, we held approximately 858,000 net acres in the Appalachian Basin.

HG Acquisition

On December 5, 2025, we entered into a definitive agreement to acquire 100% of the issued and outstanding equity interests of HG Production for total cash consideration of $2.8 billion, subject to the terms and conditions thereof. The HG Acquisition included approximately 385,000 net acres in the core of the Marcellus Shale in West Virginia. This acquisition closed on the Closing Date. The HG Acquisition was funded with borrowings under the Term Loan, net proceeds of the 2036 Notes, borrowings under the Credit Facility and restricted cash. See Note 3—Transactions to our unaudited condensed consolidated financial statements for additional information. The Company’s condensed consolidated statement of operations for the six months ended June 30, 2026 included results of operations from the assets and operations acquired in the HG Acquisition from the Closing Date through June 30, 2026.

In light of the nature and location of the assets and operations acquired in the HG Acquisition, we and Antero Midstream agreed in principle to certain updates to, and intend to modify, our existing commercial arrangements to provide for well pad compression with respect to certain wells and to provide certain water services. See Note 15—Related Parties to our unaudited condensed consolidated financial statements for additional information.

Utica Shale Divestiture

On December 5, 2025, we entered into a purchase and sale agreement with the Buyer Parties to sell our Utica Shale Properties for aggregate cash consideration of $800 million, subject to the terms and conditions thereof. The Utica Shale Properties included approximately 80,000 gross (70,000 net) acres located in Ohio and proved reserves of approximately 600 Bcfe as of December 31, 2025. The Utica Shale Divestiture closed on February 23, 2026, with an effective date of July 1, 2025. The net proceeds from the Utica Shale Divestiture were used for the repayment of long-term debt. See Note 3—Transactions to our unaudited condensed consolidated financial statements for additional information.

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Martica Hurdle Achievement and Dissolution

On May 1, 2026, Sixth Street achieved its Hurdle for Martica. As such, beginning May 1, 2026, 85% of the distributions in respect of the ORRIs to which Sixth Street was entitled immediately prior to the Hurdle being achieved reverted to us. On June 30, 2026, we elected to dissolve Martica and make in-kind liquidating distributions to Sixth Street and ourselves, which included conveyance of the ORRIs to Sixth Street and Antero Resources after giving effect to the Reversion, after which Martica was deconsolidated for our condensed consolidated financial statements. On July 1, 2026, after the deconsolidation of Martica, our condensed consolidated financial statements will reflect the ORRIs conveyed to us by Martica after giving effect to the Reversion, including the related earnings and cash flows. See Note 2—Summary of Significant Accounting Policies for additional information.

Financing Highlights

Issuance of 2036 Notes

On January 28, 2026, we issued $750 million of 5.400% senior notes due February 1, 2036 at a price of 99.869% of par. The 2036 Notes are unsecured and rank pari passu to our Credit Facility, Term Loan and other outstanding senior notes. The 2036 Notes are not guaranteed by any of our subsidiaries. The net proceeds from this offering were used to partially fund the HG Acquisition. See Note 3—Transactions and Note 7—Debt to our unaudited condensed consolidated financial statements for additional information.

Term Loan

On February 3, 2026, substantially concurrently with the consummation of the HG Acquisition, we entered into an unsecured three year term loan facility in an aggregate principal amount of $1.5 billion with the lenders party thereto and Royal Bank of Canada, as administrative agent. Borrowings are unsecured and are not guaranteed by any of our subsidiaries. On February 3, 2026, we borrowed $1.5 billion in a single borrowing to partially fund the HG Acquisition. The Term Loan is scheduled to mature on February 3, 2029. As of June 30, 2026, we have $1.1 billion outstanding on the Term Loan. See Note 3—Transactions and Note 7—Debt to our unaudited condensed consolidated financial statements for additional information.

Redemption of 2029 Notes

On February 24, 2026, we redeemed the remaining $365 million principal amount of the 2029 Notes at 101.271% of the principal amount thereof, plus accrued and unpaid interest, and the 2029 Notes were fully retired on such date. See Note 7—Debt to our unaudited condensed consolidated financial statements for additional information.

Commercial Paper Program

On June 16, 2026, we established the Commercial Paper Program pursuant to which we may issue short-term, unsecured commercial paper notes. The Commercial Paper may be issued and redeemed from time to time, with the aggregate face or principal amount of the notes outstanding under the Commercial Paper Program at any time not to exceed $1.65 billion. Our Credit Facility will serve as a liquidity backstop for any issuances under the Commercial Paper Program, and we intend to maintain available capacity under the Credit Facility in an amount at least equal to the aggregate outstanding borrowings under the Commercial Paper Program. See Note 7—Debt to our unaudited condensed consolidated financial statements for additional information.

Share Repurchase Program

During 2022, our Board of Directors authorized a share repurchase program that allows us to repurchase up to $2.0 billion of outstanding common stock. During the three and six months ended June 30, 2026, we repurchased approximately 1.1 million shares of our common stock at a total cost of $38 million through our share repurchase program. As of June 30, 2026, we have approximately $877 million of capacity remaining under our share repurchase program. The shares may be repurchased from time to time in open market transactions, through privately negotiated transactions or by other means in accordance with federal securities laws. The timing, as well as the number and value of shares repurchased under the program, will be determined by us at our discretion and will depend on a variety of factors, including the market price of our common stock, general market and economic conditions and applicable legal requirements.

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Market Conditions and Business Trends

Commodity Markets

Prices for natural gas, NGLs and oil that we produce significantly impact our revenues and cash flows. Benchmark prices for C3+ NGLs and oil increased significantly, while benchmark prices for natural gas and ethane decreased during the three months ended June 30, 2026 as compared to the same period of 2025. Benchmark prices for natural gas and oil increased significantly, while benchmark prices for ethane decreased and C3+ NGLs remained consistent during the six months ended June 30, 2026 as compared to the same period of 2025. We monitor the economic factors that impact natural gas, NGLs and oil prices, including domestic and foreign supply and demand indicators, domestic and foreign commodity inventories, the actions of Organization of Petroleum Exporting Countries and other large producing nations and the current conflicts in Ukraine, Venezuela and in the Middle East, among others. In the current economic environment, we expect that commodity prices for some or all of the commodities we produce could remain volatile. This volatility is beyond our control and may adversely impact our business, financial condition, results of operations and future cash flows. However, we use derivative instruments when circumstances warrant to manage our exposure to commodity price risk. See “—Hedge Position” and Note 11—Derivative Instruments to our unaudited condensed consolidated financial statements for additional information on our derivative instruments.

The following table details the average benchmark natural gas, NGLs and oil prices:

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K. The following discussion contains “forward-looking statements” that reflect our future plans, estimates, beliefs and expected performance. We caution that assumptions, expectations, projections, intentions, or beliefs about future events may, and often do, vary from actual results and the differences can be material. Some of the key factors that could cause actual results to vary from our expectations include changes in natural gas, NGLs and oil prices, the timing of planned capital expenditures, our ability to fund our development programs, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as our ability to access them, impacts of world health events and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting our business, as well as those factors discussed below, all of which are difficult to predict. In light of these risks, uncertainties and assumptions, the forward-looking events discussed may not occur. See “Cautionary Statement Regarding Forward-Looking Statements.” Also, see the risk factors and other cautionary statements described under the heading “Item 1A. Risk Factors.” We do not undertake any obligation to publicly update any forward-looking statements except as otherwise required by applicable law.

Our Company

We have assembled a portfolio of long-lived properties that are characterized by what we believe to be high repeatability and low geologic risk. We focus on unconventional reservoirs, which can generally be characterized as fractured shale formations. Our management team has worked together for many years and has a successful track record of reserve and production growth as well as significant expertise in unconventional resource plays. Our strategy is to leverage our team’s experience delineating and developing natural gas resource plays to develop our reserves and production, primarily on our existing multi-year inventory of drilling locations in the Appalachian Basin. As of December 31, 2025, we held approximately 537,000 net acres in the Appalachian Basin. In addition, we estimate that approximately 168,000 net acres of our leasehold may be prospective for the slightly shallower Upper Devonian Shale.

As of December 31, 2025, our estimated proved reserves were 19.1 Tcfe, consisting of 11.8 Tcf of natural gas, 679 MMBbl of assumed recovered ethane, 529 MMBbl of C3+ NGLs and 23 MMBbl of oil. These reserve estimates have been prepared by our internal reserve engineers and management and audited by our independent reserve engineers. As of December 31, 2025, we had 1,279 potential horizontal well locations on our existing leasehold acreage that were classified as proved, probable and possible.

We have three reportable segments: exploration and production, our equity method investment in Antero Midstream and marketing. All of our operations are conducted in the United States. See Note 17—Reportable Segments to our consolidated financial statements for additional information.

HG Acquisition

On December 5, 2025, we entered into a definitive agreement to acquire 100% of the issued and outstanding equity interests of HG Production from HG Energy for total cash consideration of $2.8 billion, subject to the terms and conditions thereof. The HG Acquisition includes approximately 385,000 net acres in the core of the Marcellus Shale in West Virginia. Pursuant to the same agreement, Antero Midstream Partners agreed to acquire 100% of the issued and outstanding equity interests of HG Midstream from HG Energy for cash consideration of $1.1 billion, subject to the terms and conditions thereof. The HG Midstream Acquisition includes gathering pipelines and integrated water handling assets in the core of the Marcellus Shale in West Virginia. These acquisitions closed on February 3, 2026. The HG Acquisition was funded with borrowings under the Term Loan A Facility, net proceeds of the 2036 Notes (as defined below), borrowings under the Credit Facility and restricted cash. See Note 3—Transactions to our consolidated financial statements for additional information. We intend to make certain modifications to our existing commercial arrangements with Antero Midstream to provide for on-pad compression with respect to certain wells and to provide a transition period through 2026 before certain water services would be provided under the existing agreements with Antero Midstream.

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Utica Shale Divestiture

On December 5, 2025, we entered into a definitive agreement with the Buyer Parties to sell our Utica Shale Properties for aggregate cash consideration of $800 million, subject to the terms and conditions thereof. The Utica Shale Properties include approximately 80,000 gross (70,000 net) acres located in Ohio and proved reserves of approximately 600 Bcfe as of December 31, 2025. The Utica Shale Divestiture is expected to close in February 2026, subject to the satisfaction of certain customary closing conditions. The net proceeds from the Utica Shale Divestiture are expected to be used for the repayment of long-term debt. See Note 3—Transactions to our consolidated financial statements for additional information.

Financing Highlights

Credit Facility Maturity Date Extension

Effective July 30, 2025, we obtained the consent of each of the lenders under our Unsecured Credit Facility to extend the Maturity Date from July 30, 2029 to July 30, 2030. The terms of the Unsecured Credit Facility otherwise remain unchanged. Under the terms of the Unsecured Credit Facility, we may request two one-year extensions of the Maturity Date, subject to the satisfaction of certain conditions. This is the first such extension. See Note 7—Long-Term Debt to our consolidated financial statements for additional information.

Issuance of the 2036 Senior Notes

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On January 28, 2026, we issued $750 million of 5.400% senior notes due February 1, 2036 (the “2036 Notes”) at a price of 99.869% of par. The 2036 Notes are unsecured and rank pari passu to our Unsecured Credit Facility and Term Loan A Facility and other outstanding senior notes. The 2036 Notes are not guaranteed by any of our subsidiaries. The net proceeds from this offering were used to partially fund the HG Acquisition. See Note 3—Transactions and Note 7—Long-Term Debt to our consolidated financial statements for additional information.

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Notice of Redemption of 2029 Notes

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On February 9, 2026, we notified the holders of our 7.625% senior notes due February 1, 2029 (the “2029 Notes”) of our intent to redeem all $365 million aggregate principal amount of our 2029 Notes on February 24, 2026, subject to certain conditions, including the closing of the Utica Shale Divestiture, at a redemption price of 101.271%, plus accrued and unpaid interest.

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Term Loan A

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On February 3, 2026, substantially concurrently with the consummation of the HG Acquisition, we entered into an unsecured three year term loan facility in an aggregate principal amount of $1.5 billion with the Royal Bank of Canada, RBC Capital Markets and JPMorgan Chase Bank, N.A. (collectively, the “Banks”). Borrowings are unsecured and are not guaranteed by any of our subsidiaries. On February 3, 2026, we borrowed $1.5 billion in a single borrowing to partially fund the HG Acquisition. The Term Loan A Facility is scheduled to mature on February 3, 2029. See Note 3—Transactions and See Note 7—Long-Term Debt to our consolidated financial statements for additional information.

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Debt Repurchase Program

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During the year ended December 31, 2025, we redeemed the remaining $97 million aggregate principal amount of our 8.375% senior notes due July 15, 2026 (the “2026 Notes”) at a redemption price of 102.094% of the principal amount thereof, plus accrued and unpaid interest. In addition, we repurchased $42 million aggregate principal amount of our 2029 Notes through open market transactions at a weighted average price of approximately 103% of the principal amount thereof, plus accrued and unpaid interest. See Note 7—Long-Term Debt to our consolidated financial statements for additional information.

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Share Repurchase Program

During 2022, our Board of Directors authorized a share repurchase program that allows us to repurchase up to $2.0 billion of outstanding common stock. Through our share repurchase program, during the year ended December 31, 2025, we repurchased and retired approximately 4 million shares of our common stock at a total cost of $136 million. As of December 31, 2025, we have approximately $914 million of capacity remaining under our share repurchase program. The shares may be repurchased from time to time in open market transactions, through privately negotiated transactions or by other means in accordance with federal securities laws. The timing, as well as the number and value of shares repurchased under the program, will be determined by us at our discretion and will depend on a variety of factors, including the market price of our common stock, general market and economic conditions and applicable legal requirements.

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Market Conditions and Business Trends

Commodity Markets

Prices for natural gas, NGLs and oil that we produce significantly impact our revenues and cash flows. Benchmark prices for natural gas and ethane increased significantly, while benchmark prices for C3+ NGLs and oil decreased, during the year ended December 31, 2025 as compared to the year ended December 31, 2024. As a result of the higher benchmark natural gas and ethane prices during the year ended December 31, 2025, we experienced an increase in price realization for natural gas and ethane products, partially offset by the effects of decreased benchmark NGLs and oil prices as compared to the year ended December 31, 2024. We monitor the economic factors that impact natural gas, NGLs and oil prices, including domestic and foreign supply and demand indicators, domestic and foreign commodity inventories, the actions of Organization of Petroleum Exporting Countries and other large producing nations and the current conflicts in Ukraine, Venezuela and in the Middle East, among others. In the current economic environment, we expect that commodity prices for some or all of the commodities we produce could remain volatile. This volatility is beyond our control and may adversely impact our business, financial condition, results of operations and future cash flows. However, we use derivative instruments when circumstances warrant to manage our exposure to commodity price risk. See “—Hedge Position” and Note 11—Derivative Instruments to our consolidated financial statements for additional information on our derivative instruments.

The following table details the average benchmark natural gas, NGLs and oil prices:

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