(Reuters) - EOG Resources ( EOG ) beat fourth-quarter profit estimates on higher production, but shares fell 4.1% on Friday as the company forecast higher capital expenditure for the current year.

The higher spend and cash costs in 2025 led to a lower-than-expected free cash flow target, which came in at $4.7 billion compared to an expected $5.2 billion, per analysts polled by LSEG.

"Essentially our capital and volume growth is similar to 2024, the free cash is a little bit less, and the two drivers really are increased cash costs and a bit of an increase in operating expenses in the field," said company executives in the post-earnings call.

"We've got nearly $100 million increased capital internationally," they added, noting that volumes from its two natural gas exploration joint venture projects - one with Bahrain's Bapco Energies and the Coconut project with BP in Trinidad - would only show up in 2026.

EOG's earnings beat on Thursday came despite the company's expenses rising 3.6% in the reporting quarter compared to last year, and overall quarterly revenue falling 12% to $5.59 billion due to the lower oil revenues and losses from derivative contracts.

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.

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.

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.

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.