Hess Midstream (HESM) Q2 2025 earnings summary

Executive summary

• Net income for Q2 2025 was $179.7 million, up from $160.3 million in Q2 2024, with adjusted EBITDA reaching $316.0 million, reflecting strong operational performance and higher volumes.

• Revenues for Q2 2025 were $414.2 million, a significant increase year-over-year, driven by higher physical volumes and tariff rates.

• Chevron completed its merger with Hess in July 2025, now indirectly holding a 37.8% interest, with new board structure and governance updates.

• Public ownership increased to 62.2% as of June 30, 2025, following equity offerings and unit repurchases.

• S&P upgraded senior unsecured debt to BBB- investment grade in July 2025, improving credit terms.

Financial highlights

• Net income attributable to LP for Q2 2025 was $90.3 million ($0.74 per Class A share), up from $49.5 million ($0.59 per share) in Q2 2024.

• Adjusted EBITDA for Q2 2025 was $316.0 million, up from $276.5 million in Q2 2024.

• Gross adjusted EBITDA margin for Q2 2025 was 82%, up from 81% in Q2 2024 and above the 75% target.

• Q2 capital expenditures were $70 million; adjusted free cash flow was $193.8 million.

• Declared a Q2 2025 cash distribution of $0.7370 per Class A share, a $0.0272 increase from Q1 2025.

Outlook and guidance

• Full-year 2025 adjusted EBITDA guidance maintained at $1.235–$1.285 billion, with net income guidance updated to $685–$735 million.

• Adjusted free cash flow for 2025 expected at $725–$775 million, with $125 million excess after distributions.

• Targeting at least 5% annual distribution growth per Class A share through 2027 and maintaining a long-term leverage target of 3x Adjusted EBITDA.

• Management expects all volumes to remain above minimum volume commitments through at least 2027.

• Capital expenditures in 2025 focus on expanding compression capacity and pipeline infrastructure, with a $300 million capex target.