Energy Transfer LP (ET)·Q1 2025 Earnings Summary

Executive Summary

• Q1 2025 delivered Adjusted EBITDA of $4.10B (+5.6% YoY), Distributable Cash Flow (as adjusted) of $2.31B, and diluted EPS of $0.36; revenue was $21.02B. Strength was driven by Midstream (including a nonrecurring $160M Winter Storm Uri recognition), Interstate record volumes and strong NGL exports, while Crude saw timing-related optimization losses expected to partially reverse in Q2 .
• Guidance maintained: 2025 Adjusted EBITDA $16.1–$16.5B and ~$5B growth capex; management reiterated confidence in fee-based cash flows and project pipeline ramping into 2026–2027 .
• Distribution raised to $0.3275 per unit ($1.31 annualized) for Q1 2025, up >3% YoY, reinforcing capital return momentum .
• Strategic catalysts: HOA with MidOcean Energy for 30% of Lake Charles LNG and SPA with Kyushu Electric up to 1.0 mtpa, plus CloudBurst AI data center gas supply agreement; all build commercialization and demand-pull optionality .
• Liquidity strong: $4.37B available under the revolver as of 3/31/25; diversified segment mix with no single segment >1/3 of Adjusted EBITDA .

What Went Well and What Went Wrong

What Went Well

• Midstream outperformed: Adjusted EBITDA rose to $925M (from $696M), aided by Permian volume growth and a nonrecurring $160M recognition tied to Winter Storm Uri; “we saw strong volumes… in addition, we saw strong NGL exports” .
• Interstate gas set records: Adjusted EBITDA increased to $512M (from $483M), driven by Panhandle, Trunkline, Gulf Run utilization and higher rates; management highlighted record throughput and rate improvements .
• NGL export capacity ramp: Flexport nearing completion with ethane service in May and propane in July; “over 90% sold out under 3–5-year agreements starting Jan 1, 2026” and management sees minimal impact from tariffs on ethane/LPG demand .

What Went Wrong

• Crude segment pressured: Adjusted EBITDA declined to $742M (from $848M) on lower transportation and timing of optimization losses; ~$30M hedge inventory losses are expected to reverse in Q2 .
• Intrastate EBITDA fell to $344M (from $438M) as lower gas price volatility reduced pipeline optimization, offsetting storage optimization gains .
• Cost inflation: NGL and Midstream operating expenses rose (utilities, employee and project costs), while fractionation/refinery services margins softened; NGL Adjusted EBITDA declined to $978M (from $989M) .

Financial Results

Segment Adjusted EBITDA (Q1 2025 vs Q1 2024):

Key KPIs (Q1 2025 vs Q1 2024):

Guidance Changes

Earnings Call Themes & Trends

Management Commentary

• “We continue to expect our 2025 adjusted EBITDA to be between $16.1 billion and $16.5 billion… Our cash flows are highly fee-based with limited commodity price exposure... we are well positioned to manage volatility while we continue to grow.”
• “During the quarter, we achieved record volumes driven by higher throughput on Panhandle, Gulf Run and Trunkline… we also had increased rates on several of our pipelines.”
• “Flexport expansion… ethane service later this month and propane service in July… we’re over 90% sold out under 3- to 5-year agreements starting January 1 of ’26.”
• “We now pass 10.4 million tons [Lake Charles LNG]… targeting about 15 million tons… hopeful we reach FID by the end of the year.”

Q&A Highlights

• Lake Charles LNG commercialization: Management cited momentum (HOA with MidOcean; SPA with Japanese utility; HOA with German company) and target FID by year-end, while evaluating partner structures and EPC costs .
• Hugh Brinson pipeline demand: Phase 1 sold out; negotiations well in excess of Phase 2 capacity; considering bidirectional capability; opportunity set includes data centers and power plants with limited incremental capex .
• Data center/power demand: ~150 prospective Texas data centers; pipeline and fiber/electric corridor adjacency provides advantaged positioning; announcements anticipated in 4–8 weeks .
• Guidance drivers: Tight range reflects muted commodity exposure (~10% of business) and limited volume sensitivity; intrastate optimization was lighter in Q1, partially offset by nonrecurring midstream item .
• Capex flexibility and 2026 outlook: 2025 growth capex ~$5B reiterated; ability to defer if macro softens; 2026 sanctioned spend currently “less than half” of $5B .

Estimates Context

Values retrieved from S&P Global.*

Where estimates may adjust: Crude’s optimization loss reversal in Q2 (~$30M) and midstream’s nonrecurring $160M recognition in Q1 could prompt fine-tuning to segment trajectories and full-year mix assumptions .

Key Takeaways for Investors

• Quality beat on Adjusted EBITDA with EPS roughly in line; revenue modestly below consensus—stock narrative likely focuses on fee-based resilience and project execution rather than top-line volatility .
• Midstream strength was boosted by a one-time $160M item; normalize forward assumptions accordingly; watch core Permian volumes and WTG integration ramp .
• Crude softness tied to timing/hedge inventory losses expected to reverse in Q2; monitor Bakken volumes and ET-S Permian JV contributions .
• NGL exports are structurally de-risked with Flexport largely contracted; ethane/propane ramps in 2025, ethylene in Q4 2025—cash flow visibility rising .
• Lake Charles LNG advancing: HOA with MidOcean and new SPAs widen commercialization; FID by year-end would be a step-change catalyst with upstream pipeline expansion opportunities .
• Capital allocation: Distribution increased; balance sheet/liquidity robust ($4.37B revolver availability); 2026 capex likely below 2025 peak—supports improving FCF coverage .
• Near-term trading: Watch Q2 crude optimization reversal and Flexport startup milestones; medium-term thesis hinges on LNG/data center/power demand pull and contracted NGL export growth .

Additional Context and References

• Q1 2025 results and details, including segment tables and reconciliations .
• Prior quarters for trend: Q4 2024 press release and financials –; Q3 2024 press release and financials –.
• Distribution increase (Q1 2025) .
• Strategic press releases: MidOcean HOA for Lake Charles LNG ; Kyushu SPA ; CloudBurst AI data center gas supply agreement .