Chesapeake Energy Corporation (CHK) - Get Report may have produced less oil and gas this quarter, but it got paid more to do it - and investors are happy.

The company was trading up more than 3% Thursday, Aug. 3 after announcing that its second quarter earnings beat analyst expectations despite a downturn in volume over the same quarter last year of about 25%.

The Oklahoma City, Okla.-based E&P reported earnings per share of 18 cents on sales of $2.2 billion, almost 30% ahead of the FactSet consensus of 14 cents per share. The earnings were boosted by a bump in its realized oil price to $48.9 per barrel up from $44.3 per barrel in the same quarter last year.

While total revenues were up more than 40% compared to the same quarter last year, the increase came almost entirely from revenues from oil, natural gas, and NGL. Those revenues spiked 190% to $1.3 billion from $440 million a year ago. Profits in the quarter totaled almost $500 million, compared to a nearly $2 billion loss in the second quarter of 2016.

The company also announced that it would be decreasing its capital expenditures throughout the remainder of the year, including reducing its active rig count to 14 drilling rigs by the end of the year from the 18 it has active today. Capital expenditures have been on the up-and-up, as the company added about $200 million to its CapEx costs since the same period last year and doubled its average rig count.

Hedging proved to be a boon to the company this quarter, and Chesapeake said it remains hedged throughout 2017 and into 2018. For the remainder of the year, 60% of the company's oil production is hedged at $50.32 per barrel, while 74% of the company's natural gas is hedged at $3.09 per thousand cubic feet. 2.7 million barrels of oil is hedged at an average price of $51.78 for 2018, up from $51.43 the company announced last quarter. 535 billion cubic feet of natural gas is hedged at an average price of $3.09 per thousand cubic feet for 2018, down from last quarter's announced average of $3.12. 

Chesapeake plans to continue to sell off its assets, which totaled $1.2 billion in the quarter, down from $1.3 billion in the previous quarter and $2.1 billion in the fourth quarter of last year. About $360 million of asset sales have closed so far this year, or are under sale agreements, the company said.