Kinetik Holdings Inc. reported fourth‑quarter and full‑year 2025 results on February 25, 2026. Net income rose to $416.7 million from $16.2 million in Q4 2024, while adjusted EBITDA for the quarter reached $252.1 million, a 15% increase from the $218.5 million reported a year earlier. Full‑year 2025 adjusted EBITDA totaled $987.7 million, up from $876.3 million in 2024, and net income for the year climbed to $525.9 million, a 30% gain over the $406.5 million earned in 2024.
Revenue for the quarter was $430.42 million, falling short of the $476.77 million consensus estimate. The shortfall was driven by weaker demand in the Permian Basin and lower gas prices, which compressed margins. Despite the revenue miss, earnings per share surged to $2.16, beating the $0.33 consensus by $1.83, a 554% surprise. The EPS beat was largely attributable to a $45 million gain from the sale of Kinetik’s equity interest in EPIC Crude, which offset the decline in the Pipeline Transportation segment.
The Midstream Logistics segment generated $173.1 million of adjusted EBITDA, up 15% year‑over‑year, reflecting stronger throughput volumes and higher utilization rates. In contrast, the Pipeline Transportation segment produced $84.0 million of adjusted EBITDA, a 9% decline driven by the divestiture of its EPIC Crude interest. Operating cash flow for the quarter was $151.7 million, while free cash flow was a modest $12.0 million negative, reflecting capital expenditures and timing of dividend distributions.
President and CEO Jamie Welch said, "2025 was a year of challenges and strategic progress for Kinetik as we navigated a difficult operating environment." He added that the company advanced core initiatives, including the construction of the ECCC Pipeline and the AGI project at Kings Landing, and that the capital investments made in 2025 provide a solid foundation for 2026 and beyond.
The market reacted positively to the results, with analysts noting the strong EPS beat and the company’s confidence in its 2026 outlook. Kinetik guided for adjusted EBITDA of $950 million to $1,050 million and capital expenditures of $450 million to $510 million for 2026, signaling continued investment in growth projects while maintaining financial resilience. The guidance reflects a 7% increase year‑over‑year and underscores management’s belief that the company’s strategic initiatives will drive future earnings growth.
Kinetik’s dividend coverage ratio for the quarter was 1.4×, indicating a stable dividend policy. The company also announced a revised capital allocation framework that prioritizes growth‑oriented reinvestment while preserving balance‑sheet flexibility. In addition, Kinetik completed a bolt‑on acquisition of natural gas and crude oil gathering systems in Reeves County, Texas, in January 2025, and S&P Global Ratings upgraded its outlook to positive, citing increased scale and expected deleveraging.
The content on EveryTicker is for informational purposes only and should not be construed as financial or investment advice. We are not financial advisors. Consult with a qualified professional before making any investment decisions. Any actions you take based on information from this site are solely at your own risk.