Chesapeake Energy Corporation (NYSE:CHK) recently reported its 3Q2016 financial results, recording revenues of $2.3 billion, beating analyst estimates by $0.1 billion. Although this was a substantial improvement, as compared to the preceding quarter, the revenues were still below the figures from 3Q2015 of $3.4 billion. However, the best part of the financial report was that CHK had an adjusted net income for the 3Q2016, worth $27 million, as compared to a net loss of $145 million a year ago.

The company further beat analyst expectations for its EPS as well, recording $0.09 per share, as compared to analyst consensus fo -$0.03 per share. Commenting on the financial condition of the CHK, Doug Lawler, the CEO of the company, stated that they were making significant progress in reducing costs and leverage, while continuing to improve future midstream expenses. He claimed that in regard to Chesapeake’s balance sheet, they had made significant improvements, which would serve as a strong foundation for their future.

Analyst have noted that Chesapeake is currently focusing on reducing its debt burden, with the help of asset sales, open market repurchases and debt exchanges. The 3Q2016 also revealed that CHK had made substantial improvements to its operations, which had brought down the average realized price for crude oil to $45.24 per barrel, a decline of over $20 per barrel, from 3Q2015. The company also provided an update on its production and capex guidance. As such, the company expects to experience a production growth of 0%-3%. However, this was also accompanied by a raise in capex guidance, which now stands at $1.6-$1.8 billion, for the FY2016.

The encouraging financial report has helped the stock rally on November 3, but its success was short lived, as it reversed its gains soon after. This could be possible due to the fact that the company faces a securities class action lawsuit, on charges of issuing misleading statements, with regard to the acquisition and classification of oil & gas properties.

Chesapeake Energy Corporation (NYSE:CHK) moved up by 3.02%, in terms of its share value, to close at $5.45 per share, at the end of the November 7 trading session.