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Marathon Petroleum Corp (MPC)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 adjusted EPS was $3.01, below S&P Global consensus of $3.16, while sales materially exceeded consensus; GAAP diluted EPS was $4.51 and adjusted EBITDA was $3.206B, with net income attributable to MPC of $1.370B . Estimates retrieved from S&P Global.*
  • Refining & Marketing delivered strong cash generation: margin $17.60/bbl, 95% utilization, and 3.005 mbpd net throughput; Midstream adjusted EBITDA grew 5% YoY to $1.709B .
  • Management announced a 10% quarterly dividend increase and highlighted expected $2.8B annual distributions from MPLX, covering MPC dividends and standalone capex; $926M returned to shareholders in Q3, including $650M in buybacks .
  • Q4 2025 outlook guides to crude throughput of 2.905 mbpd, refining operating costs of $5.80/bbl, turnaround expense of $420M, distribution costs of ~$1.575B, and corporate costs of $240M; management cited normalization of jet/diesel spreads and butane blending as tailwinds for capture .

What Went Well and What Went Wrong

What Went Well

  • R&M strength: adjusted EBITDA of $1.762B and margin $17.60/bbl, with 95% utilization and several refineries achieving monthly throughput records; CEO emphasized “strong cash generation” and commercial optimization .
  • Midstream growth: adjusted EBITDA rose to $1.709B (+5% YoY) on higher rates/throughputs and acquisitions; MPLX distributions expected at $2.8B annually, supporting capital returns at MPC .
  • Capital returns and dividend: $926M returned in Q3, including $650M in repurchases; announced 10% quarterly dividend increase as confidence in outlook and cash generation .

What Went Wrong

  • Margin capture: sequential decline to 96% (from 105% in Q2) driven by West Coast clean product margin compression (~40%), jet-to-diesel inversion, and downtime of Galveston Bay REZID hydrocracker; management expects normalization in Q4 .
  • Renewable Diesel: continued losses with segment adjusted EBITDA of $(56)M amid weaker margins and higher feedstock costs; utilization improved to 86% but policy uncertainty persists .
  • Distribution and operating costs: refining operating costs rose to $5.59/bbl; Q4 distribution cost guidance of ~$1.575B reflects commercial routing to higher-margin markets, raising costs near term .

Financial Results

Consolidated Results (Q1 → Q2 → Q3 2025)

MetricQ1 2025Q2 2025Q3 2025
Total Revenues and Other Income ($USD Billions)$31.850 $34.101 $35.849
Sales and Other Operating Revenues ($USD Billions)$31.517 $33.799 $34.809
Net Income Attributable to MPC ($USD Billions)$(0.074) $1.216 $1.370
Diluted EPS (GAAP) ($)$(0.24) $3.96 $4.51
Adjusted Diluted EPS ($)—$3.96 $3.01
Adjusted EBITDA ($USD Billions)$1.975 $3.286 $3.206

Segment EBITDA (Q1 → Q2 → Q3 2025)

Segment Adjusted EBITDA ($USD Billions)Q1 2025Q2 2025Q3 2025
Refining & Marketing$0.489 $1.890 $1.762
Midstream$1.720 $1.641 $1.709
Renewable Diesel$(0.042) $(0.019) $(0.056)

Refining KPIs (Q1 → Q2 → Q3 2025)

KPIQ1 2025Q2 2025Q3 2025
R&M Margin ($/bbl)$13.38 $17.58 $17.60
Refining Operating Costs ($/bbl)$5.74 $5.34 $5.59
Net Refinery Throughputs (mbpd)2,849 3,060 3,005
Crude Capacity Utilization (%)89 97 95
Capture (%)—105 (Q2 commentary) 96 (Q3)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Refining Operating Costs ($/bbl)Q3 2025 vs Q4 2025$5.70 (Q3) $5.80 (Q4) Raised
Distribution Costs ($MM)Q3 2025 vs Q4 2025$1,525 (Q3) $1,575 (Q4) Raised
Turnaround Expense ($MM)Q3 2025 vs Q4 2025$400 (Q3) $420 (Q4) Raised
Depreciation & Amortization ($MM)Q3 2025 vs Q4 2025$415 (Q3) $400 (Q4) Lowered
Crude Refined (mbpd)Q3 2025 vs Q4 20252,730 (Q3) 2,675 (Q4) Lowered
Other Charge & Blendstocks (mbpd)Q3 2025 vs Q4 2025210 (Q3) 230 (Q4) Raised
Total Throughputs (mbpd)Q3 2025 vs Q4 20252,940 (Q3) 2,905 (Q4) Lowered
Corporate Costs ($MM)Q3 2025 vs Q4 2025$240 (Q3) $240 (Q4) Maintained
DividendOngoing$0.91 declared (payable Sept 10) Announced 10% increase (amount not disclosed) Raised

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1 & Q2)Current Period (Q3 2025)Trend
Margin CaptureQ2 capture 105%; strong commercial execution . Q1 heavy turnarounds pressured R&M .Capture 96% on West Coast headwinds, jet/diesel inversion; REZID downtime; normalization in Q4; butane inventory tailwind .Softer sequentially, expected rebound
West Coast DynamicsElevated margins and heavier turnarounds in Q2 West Coast .Clean product margins fell ~40%; feedstock advantage rising; LAR utility intertie project startup in Q4; potential pipeline remains “ambitious” (≥2029) .Structurally tighter; advantaged positioning
Midstream Growth/MPLXBANGL remaining interest acquired; Northwind announced; multiple Permian/Northeast projects .Eiger Express FID; Secretariat year-end; Harmon Creek III, Titan, BANGL expansion; LPG export terminal and fracs in 2028–29; $2.8B annual MPLX distributions .Steady build-out, cash flow durability
Renewable DieselUtilization improvement, still losses; policy uncertainty .86% utilization; margins weaker; regulatory uncertainty (feedstocks, credits); limited capex; PTC largely reflected .Operationally stable, policy headwinds
Macro/DemandExpect improving seasonal trends into summer (Q1 PR) .Diesel/jet modest growth; gasoline flat to slightly lower; tight global supply; geopolitical disruptions widening cracks; exports to Europe strong .Tight supply/demand supports cracks
Capital Returns/Leverage$1.3B returned in Q1; $1.0B in Q2; no intent to lever for buybacks .$926M in Q3; primary return via buybacks; will not add debt for buybacks; dividend pathway supported by MPLX .Consistent, distribution-supported

Management Commentary

  • “In the third quarter, Refining & Marketing delivered strong cash generation… MPLX will provide $2.8 billion of annualized distributions to MPC that we expect to cover our dividends and standalone capital spending” — CEO Maryann Mannen .
  • “We are off to a good start in the fourth quarter… jet and product margins [back to] normal… butane inventory build in 3Q will be a tailwind in the fourth quarter” — Executive remarks .
  • “We believe MPC is positioned to deliver industry-leading cash generation through all parts of the cycle” — CEO .
  • “We do not see taking on debt at MPC to buy back stock as something that we would do” — CEO .

Q&A Highlights

  • Capture drivers: West Coast accounted for >50% of capture change; clean product margins fell ~40%; REZID downtime ~2% system headwind; normalization expected in Q4 .
  • Capital return stance: Buybacks remain primary lever; supported by $2.8B MPLX distributions; no intent to lever for buybacks .
  • Renewable Diesel: Operating at 86% utilization; margins pressured by feedstock costs; policy uncertainties (D4 RINs, LCFS, foreign feedstock limits) persist; PTC largely reflected .
  • Crude differentials: Expect sour diffs to widen slightly in Q1; depressed WCS prices a positive; broader tailwinds across ANS, Bakken, Syncrude .
  • West Coast market structure: advantaged feedstock and logistics; LAR project benefits; pipeline proposals viewed as ambitious (earliest ~2029) .

Estimates Context

  • Q3 2025: Adjusted EPS of $3.01 versus S&P Global consensus $3.16 (miss); Sales and other operating revenues of $34.81B versus $31.71B consensus (beat). S&P’s EBITDA consensus was ~$3.07B; company reported adjusted EBITDA of $3.206B (methodology differs; S&P “actual” EBITDA prints lower) . Estimates retrieved from S&P Global.*
MetricActualConsensusSurprise
Adjusted EPS ($)3.01 3.164*(0.15)
Sales & Other Operating Revenues ($B)34.809 31.707*+3.102
Adjusted EBITDA ($B)3.206 3.070*+0.136

Values retrieved from S&P Global.*

Where estimates may adjust:

  • EPS models likely trim near-term capture assumptions for West Coast and factor REZID downtime impact; Q4 guidance and commentary on normalization should support partial recovery .
  • Revenue trajectories may rise on stronger product cracks and throughput, particularly if diesel export dynamics remain favorable .

Key Takeaways for Investors

  • Q3 delivered strong sales and adjusted EBITDA with a softer capture; setup for Q4 improves as jet/diesel normalizes and butane blending assists margins; throughput guided to 2.905 mbpd .
  • Midstream remains a cash flow anchor, with $2.8B of annual MPLX distributions expected to fund dividends and capex, underscoring a durable capital return framework .
  • West Coast positioning is advantaged (feedstocks, logistics, LAR intertie project), but quarter-to-quarter volatility can be elevated; watch for capture rebound as REZID returns .
  • Renewable Diesel is operationally stable but still loss-making; management curtailing growth capex; policy outcomes (credits, foreign feedstocks) are key 2026 catalysts .
  • No willingness to lever for buybacks; expect continued buybacks paced by cash generation and MPLX distributions; dividend growth trajectory supported by falling share count and MPLX .
  • Crude diffs (WCS, ANS, Bakken, Syncrude) and export economics are tailwinds; monitor sour widening into Q1 and Gulf Coast export pull-through .
  • Tactical implication: near-term strength in Q4 margins and improved capture could be a positive trading catalyst; medium-term thesis rests on integrated value chains and midstream growth driving peer-leading cash returns .