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WILLIAMS COMPANIES, INC. (WMB) Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 delivered strong operational growth: Adjusted EBITDA rose 13% year over year to $1.920B and Adjusted EPS increased 14% to $0.49, with cash flow from operations up 16% to $1.439B .
  • Results versus consensus: Adjusted EPS ($0.49) was slightly below normalized EPS consensus ($0.517*), revenue ($2.923B) slightly below consensus ($2.956B*), while Adjusted EBITDA ($1.920B) was modestly above EBITDA consensus ($1.918B*) .
  • Guidance: Management reaffirmed 2025 Adjusted EBITDA midpoint at $7.75B; raised 2025 growth capex by ~$500M to $3.95–$4.25B linked to Woodside’s Louisiana LNG project; leverage midpoint ~3.7x; dividend increased 5.3% to $2.00 annualized .
  • Catalysts: Wellhead-to-water LNG strategy (10% terminal stake; fully contracted pipeline), continued Transco expansions (NESE, Power Express) and a broadened Power Innovation backlog (~$5.1B) position WMB for multi-year growth .

What Went Well and What Went Wrong

What Went Well

  • Adjusted EBITDA up 13% YoY to a quarterly record $1.920B; CEO emphasized “another quarter of excellent financial results” with strength from Transco expansions and higher G&P volumes across regions .
  • Strategic execution: Placed Transco’s Alabama Georgia Connector, Commonwealth Energy Connector, Northwest Pipeline’s Stanfield South, plus deepwater Shenandoah and Salamanca, LEG in-service; signed precedent agreements for Pine Prairie storage, MountainWest Green River West, and Transco Wharton West expansion .
  • Power Innovation backlog expanded (~$5.1B, targeted 5x build multiple) with equipment positioned “almost through the end of the decade,” supporting robust data center demand; “very, very robust engagement and interest” in speed-to-market solutions .

What Went Wrong

  • GAAP diluted EPS declined YoY to $0.53 (from $0.58), reflecting absence of prior-year gains (Aux Sable sale, Discovery consolidation), higher interest expense, and a $25M compression asset write-off in West; also higher tax provision including a $25M deferred state rate change .
  • Gas & NGL Marketing weaker realizations: Both quarterly and YTD commentary cited lower gas marketing margins despite Cogentrix contributions; segment Adjusted EBITDA remained modest ($11M) .
  • Eagle Ford MVC step-down pressured West segment revenues; while West Adjusted EBITDA grew YoY, management called out Eagle Ford MVC declines as a headwind .

Financial Results

MetricQ3 2024Q2 2025Q3 2025
Total Revenues ($USD Billions)$2.653 $2.781 $2.923
GAAP Diluted EPS ($)$0.58 $0.45 $0.53
Adjusted EPS ($)$0.43 $0.46 $0.49
Adjusted EBITDA ($USD Billions)$1.703 $1.808 $1.920
Cash Flow from Operations ($USD Billions)$1.243 $1.450 $1.439
AFFO ($USD Billions)$1.286 $1.317 $1.449

Segment breakdown (Adjusted EBITDA):

Segment Adjusted EBITDA ($USD Millions)Q3 2024Q3 2025
Transmission, Power & Gulf$830 $947
Northeast G&P$484 $505
West$330 $367
Gas & NGL Marketing Services$4 $11
Other$55 $90
Total$1,703 $1,920

KPIs:

KPIQ3 2024Q3 2025
Transco Avg Daily Transportation Volumes (MMdth)14.3 14.9
Transco Avg Daily Firm Reserved Capacity (MMdth)20.1 20.6
Northeast G&P Consolidated Gathering Volumes (Bcf/d)4.04 4.10
West Gathering Volumes (Bcf/d)5.38 6.14
NGL Production – Transmission/Power & Gulf (Mbbls/d)49 87

Actual vs Consensus (S&P Global):

MetricConsensus (Q3 2025)*Actual
Primary EPS (Normalized)$0.517*$0.49 (Adjusted EPS)
Revenue ($USD Billions)$2.956*$2.923
EBITDA ($USD Billions)$1.918*$1.920 (Adjusted EBITDA)

*Values retrieved from S&P Global.

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Adjusted EBITDA Range ($B)FY2025$7.6–$7.9; Mid: $7.75 $7.6–$7.9; Mid: $7.75 Maintained
Growth Capex ($B)FY2025$2.575–$2.875 $3.95–$4.25 (raised ~$0.5B for LNG pipeline/terminal) Raised
Maintenance Capex ($B)FY2025$0.65–$0.75 (ex. emissions/modernization) $0.65–$0.75 (same, ex. emissions/modernization) Maintained
Leverage Ratio (Midpoint)FY2025~3.65x ~3.7x Slightly higher
Dividend (Annualized)FY2025$2.00 $2.00 Maintained
AFFO/Common Dividend Coverage (Midpoint)FY20252.32x 2.32x Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current PeriodTrend
Wellhead-to-water LNG strategy (Woodside partnership; 10% LNG terminal stake; Line 200 pipeline)Not disclosed in Q1; Q2 focused on Transco/storage and Power Innovation Fully contracted take-or-pay pipeline (3.1 Bcf/d) and fully contracted LNG terminal; offtake <1% of earnings; bidirectional pipeline optimization New strategic platform; strengthens demand-pull
Power Innovation (data centers/AI demand; backlog; equipment procurement)Commercialized Socrates ($1.6B); announced Power Express; robust demand Backlog now ~$5.1B at 5x build multiple; equipment positioned “almost through the end of the decade” Backlog widened; execution accelerating
Transco expansions (NESE; Power Express; CECI)Q1 placed projects; Q2 finalized NESE commercial agreements; accelerated CECI timeline Continued expansions; Wharton West, NESE permitting progress, Power Express scope fine-tuning Pipeline growth persistent
Storage (Pine Prairie)Announced 10 Bcf expansion; demand beyond project capacity; next expansions in view Signed precedent agreements; strong LNG-linked storage need Demand rising; more projects likely
Regulatory/permitting toneAdvocates permitting reform; NESE certificate reinstatement path Confidence on NESE/Constitution timelines; affordability narrative boosting support Supportive tone, progress visible
Tariffs/macro and cost inflationSteel tariffs impact modest (1–3% of total project cost); managed via contingencies Broader cost inflation acknowledged; disciplined capital and credit protections Manageable; not thesis-changing
AI/data centers demand narrativePower Innovation targeting speed-to-market; Cogentrix intelligence “Very robust engagement”; multi-decade scaling; geographic breadth Strengthening, multi-year runway

Management Commentary

  • “Williams delivered another quarter of excellent financial results with Adjusted EBITDA up 13%… Expansions to our Transco and Gulf assets… drove earnings growth in the quarter.” — Chad Zamarin, President & CEO .
  • “We are reaffirming our previously raised guidance for 2025, with an EBITDA midpoint of $7.750 billion…” .
  • “This is an integrated platform… not a speculative entry into the LNG space.” — on Woodside LNG partnership and Line 200 .
  • “Very robust engagement and interest… long term need for power for data centers… backlog strengthened to over $5 billion.” .

Q&A Highlights

  • Equipment/procurement cadence: WMB has positioned equipment “almost through the end of the decade,” enabling ongoing Power Innovation layering through 2030 .
  • LNG contracting: Pipeline (3.1 Bcf/d) and terminal are 100% take-or-pay; offtake exposure small (<1% of earnings) and intended as a customer access “window” to international markets .
  • Capex/leverage: Growth capex trending ~$4B/year is supported by balance sheet capacity within 3.5–4.0x leverage targets; tax deferrals (bonus depreciation) improve cash profiles .
  • NESE/CECI timeline clarity: NESE approvals are advancing; CECI benefits from environmental assessment and could see partial in-service earlier, accelerating value in 2027 .
  • West/Eagle Ford MVCs: Step-downs noted, but Haynesville/LEG ramp and acquisitions (Rimrock, Saber) drive segment growth .

Estimates Context

  • Adjusted EPS came in at $0.49 versus S&P Global normalized EPS consensus of $0.517* — slight miss; revenue at $2.923B versus $2.956B* — slight miss; Adjusted EBITDA at $1.920B versus $1.918B* — modest beat .
  • Post quarter, consensus looks for a sequential step-up in Q4: EPS $0.569*, EBITDA $2.186B*, revenue $2.974B*, supported by project ramp and storage pricing.
    *Values retrieved from S&P Global.

Key Takeaways for Investors

  • Reaffirmed 2025 Adjusted EBITDA midpoint ($7.75B) and dividend ($2.00) underscore balance sheet strength and predictable cash generation .
  • Growth capex lift to $3.95–$4.25B reflects high-confidence, fully contracted LNG pipeline/terminal investments with 20-year tenors (fixed-fee, take-or-pay) .
  • Power Innovation backlog (~$5.1B) and secured equipment supply underpin multi-year AI/data center demand monetization; expect continued project FIDs .
  • Ongoing Transco expansions (NESE, Power Express, Wharton West) and Pine Prairie storage enhance demand-pull and earnings visibility through decade-end .
  • Segment momentum: Transmission/Power & Gulf continues to set records; West growing on LEG and Haynesville volumes; watch Eagle Ford MVC dynamics .
  • Tactical LNG offtake (<1% earnings) is a strategic customer access tool rather than commodity exposure, reducing risk while broadening WMB’s value chain .
  • Near-term trading lens: modest top-line/EPS miss vs consensus but EBITDA beat, plus guidance reaffirmation and LNG platform clarity, are constructive into Q4 and Analyst Day .

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