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Marathon Petroleum Corp (MPC)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered net income of $1.2B and diluted EPS of $3.96, with adjusted EBITDA of $3.3B; results were driven by 97% utilization, 105% margin capture, and continued Midstream strength .
  • Revenue and EPS exceeded Wall Street consensus; EPS beat by roughly $0.74 and revenue by ~$1.17B, while SPGI-defined EBITDA modestly missed; non-GAAP adjusted EBITDA was stronger than SPGI’s EBITDA definition, reflecting turnaround exclusions *.
  • Guidance for Q3 2025 raised turnaround expense and corporate costs versus prior quarter guidance, with operating cost per barrel higher and throughput slightly lower; distribution costs held flat .
  • Strategic catalysts included MPLX’s $2.375B Northwind Midstream acquisition, full ownership of BANGL, and continued fractionation/LPG export development, reinforcing the wellhead-to-water NGL strategy .

What Went Well and What Went Wrong

What Went Well

  • Margin execution: “97% utilization and 105% margin capture” underscored strong refining/commercial performance in a mixed margin environment .
  • Midstream resilience: Segment adjusted EBITDA rose YoY ($1.641B vs $1.620B), supported by higher rates/throughputs and strategic M&A (BANGL, Northwind) .
  • Portfolio optimization: Announced divestiture of ethanol JV interest for gross proceeds of $425M and continued high-return capex in LA, Galveston Bay, Robinson with IRRs of ~20–25% .

What Went Wrong

  • Refining cost pressure: Refining operating costs increased to $5.34/bbl (vs $4.91/bbl YoY), reflecting cost inflation and heavier turnaround burden .
  • Renewable Diesel remained negative: Segment adjusted EBITDA of $(19)M (improved YoY) amid regulatory credit and feedstock headwinds; utilization and margins improved but profitability still challenged .
  • Corporate expense ticked up: Corporate costs rose to $243M (vs $223M YoY), and Q3 outlook implies further cost elevation .

Financial Results

Consolidated Results vs Prior Quarters

MetricQ4 2024Q1 2025Q2 2025
Total Revenues and Other Income ($USD Millions)33,466 31,850 34,101
Net Income Attributable to MPC ($USD Millions)371 (74) 1,216
Diluted EPS ($USD)$1.15 $(0.24) $3.96
Adjusted EBITDA ($USD Millions)2,120 1,975 3,286

Year-over-Year (Q2)

MetricQ2 2024Q2 2025
Total Revenues and Other Income ($USD Millions)38,362 34,101
Net Income Attributable to MPC ($USD Millions)1,515 1,216
Diluted EPS ($USD)$4.33 $3.96
Adjusted EBITDA ($USD Millions)3,415 3,286

Segment Breakdown (Adjusted EBITDA)

Segment ($USD Millions)Q4 2024Q1 2025Q2 2025
Refining & Marketing559 489 1,890
Midstream1,707 1,720 1,641
Renewable Diesel28 (42) (19)
Corporate(189) (210) (243)

KPIs and Margins

KPIQ4 2024Q1 2025Q2 2025
Crude Capacity Utilization (%)94 89 97
Net Refinery Throughputs (mbpd)2,997 2,849 3,060
R&M Margin ($/bbl)$12.93 $13.38 $17.58
R&M Adj. EBITDA ($/bbl)$2.03 $1.91 $6.79
Refining Operating Costs ($/bbl)$5.26 $5.74 $5.34

Guidance Changes

MetricPeriodPrevious Guidance (Q2 2025 outlook)Current Guidance (Q3 2025 outlook)Change
R&M Operating Costs ($/bbl)Q3 2025$5.30 $5.70 Raised
Distribution Costs ($USD Millions)Q3 2025$1,525 $1,525 Maintained
Planned Turnaround Costs ($USD Millions)Q3 2025$265 $400 Raised
Depreciation & Amortization ($USD Millions)Q3 2025$410 $415 Raised
Total Refinery Throughputs (mbpd)Q3 20252,945 2,940 Slightly Lower
Corporate Costs ($USD Millions)Q3 2025$220 $240 Raised
Dividend per Share ($)Q3 2025 (declared)N/A$0.91 (payable Sept 10, record Aug 20) Announced

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024, Q1 2025)Current Period (Q2 2025)Trend
Margin capture/commercial excellenceCapture 119% in Q4; structural advantages across specialty products, asphalt, product margins; Q1 capture 104% despite heavy turnarounds 105% margin capture highlighted in Q2 release; 97% utilization Improving execution; sustained high capture
Midstream wellhead-to-water NGL strategyGulf Coast fractionation, LPG export JV with ONEOK; mid-teen returns; MPLX capex focus; distribution growth visibility BANGL 100% ownership; Northwind Midstream $2.375B announced; continued Permian/Northeast processing expansions Expanding platform; accretive M&A
West Coast regulatory/import dynamicsLA project compliance (Rule 119), imports add volatility; competitive positioning vs high-cost alternatives LA investment targeted to improve reliability/efficiency; continued emphasis on competitiveness Regulatory-driven capex; long-term asset positioning
Renewable Diesel regulatory/operationsQ4: positive EBITDA; Q1: utilization 70%, 45Z credit guidance impact; feedstock optimization via pretreat Q2: RD adj. EBITDA $(19)M (improved YoY); utilization/margins better; regulatory uncertainty persists Gradual improvement; policy-sensitive
Macro demand/tariffsConstructive demand outlook; closures likely to tighten; tariff scenarios analyzed; system optionality to pivot crude slate Management remains constructive on long-term outlook; utilization/throughputs elevated Supportive backdrop; preparedness for policy shifts

Management Commentary

  • “Our team delivered 97% utilization and 105% margin capture… We believe execution of our strategic commitments will position our integrated system to deliver industry-leading capital returns” — CEO Maryann Mannen .
  • Strategic update: LA ($100M, ~20% return, YE’25), Robinson ($150M + $50M, ~25% return, YE’26), Galveston Bay DHT ($200M in 2025; +$575M 2026–27; >20% return, YE’27) .
  • Midstream expansion: “MPLX has entered into a definitive agreement to acquire Northwind… $2.375B cash… supported by minimum volume commitments… close expected in Q3 2025” .

Q&A Highlights

  • Demand/margins: Seasonally stronger Q2 margins vs Q1; utilization ramp to meet summer demand; regional margin uplift across Mid-Con (+$6/bbl), Gulf Coast (+$3), West Coast (+$5) cited in Q1 call .
  • Capture rates: Structural and sustainable improvements in commercial performance; aim to approach 100% capture through integrated value chain .
  • Renewable diesel: Actions to realize 45Z credits starting Q2; focus on feedstock optimization leveraging pretreat; cautious on regulatory-dependent profitability .
  • Tariffs contingency: Scenario planning across refineries; optionality to pivot crude slate (e.g., Bakken, Rockies); expect producers bear much of cost impact .

Note: Q2 2025 earnings call transcript could not be retrieved due to source database inconsistency; Q&A highlights reflect recent calls (Q1/Q4) to inform trend analysis .

Estimates Context

MetricQ4 2024Q1 2025Q2 2025
Primary EPS Consensus Mean$0.02$(0.54)$3.22
Reported/Actual EPS$0.77$(0.24)$3.96
Revenue Consensus Mean ($USD Billions)$31.94$30.15$31.71
Reported/Actual Revenue ($USD Billions)$33.20$31.62$33.88

Values retrieved from S&P Global.*
Interpretation: EPS and revenue beat consensus in Q2 2025; SPGI-defined EBITDA modestly missed (estimate ~$2.96B vs actual ~$2.76B), while company-reported adjusted EBITDA was $3.29B, reflecting turnaround exclusions *.

Key Takeaways for Investors

  • Strong operational execution with 97% utilization and 105% margin capture drove an EPS and revenue beat; refining margins improved sequentially and per-barrel R&M EBITDA rebounded materially .
  • Midstream strategy is a multi-year growth pillar: BANGL full ownership, Northwind acquisition, and fractionation/LPG export projects support durable cash flows and MPLX distribution growth, enhancing MPC capital returns .
  • Cost headwinds visible: Q3 guidance raises turnaround ($400M) and operating costs ($5.70/bbl), with corporate costs up to $240M—watch margin capture to offset .
  • Renewable Diesel remains a swing factor; improved YoY but still negative EBITDA in Q2; regulatory clarity (45Z, LCFS) and feedstock optimization are key to achieving sustained profitability .
  • Shareholder returns remain robust: ~$1.0B returned in Q2 (including $692M buybacks); $6.0B authorization remaining; dividend of $0.91 declared for Sept 10 .
  • Near-term trading: Focus on margin indicators, capture updates, and throughput vs guidance; constructive demand plus asset optimization could sustain outperformance even with higher Q3 turnaround .
  • Medium-term thesis: Integrated refining/commercial excellence and MPLX’s wellhead-to-water buildout underpin cash generation and capital returns through cycles; watch regulatory/tariff developments and West Coast policy environment .

*Values retrieved from S&P Global.