Hess Midstream (HESM) Q4 2025 earnings summary

Executive summary

• Delivered strong 2025 performance, completing multi-year infrastructure projects on time and on budget, with strategic growth in gas gathering and compression systems.

• Capital spending to decrease significantly, with 2026 guidance at $150 million (down 40% from 2025) and further reductions to less than $75 million per year in 2027 and 2028.

• Free cash flow generation expected to support 5% annual distribution growth, incremental share repurchases, and debt repayment.

• Chevron became the indirect parent, holding a 37.9% interest following the July 2025 merger.

Financial highlights

• Full-year 2025 net income was $684.6 million; Adjusted EBITDA reached $1,238.1 million, up 9% year-over-year.

• Fourth quarter 2025 net income was $168 million, with Adjusted EBITDA at $309.1 million and Adjusted Free Cash Flow at $207.8 million.

• Q4 2025 revenues were $404.2 million, up $8.3 million year-over-year, driven by higher tariff rates and third-party services.

• Gross Adjusted EBITDA margin for Q4 was 83%, above the 75% target.

Outlook and guidance

• 2026 capital expenditures expected at $150 million, with further reductions to less than $75 million annually in 2027 and 2028.

• 2026 net income guidance: $650–$700 million; Adjusted EBITDA: $1,225–$1,275 million, approximately flat year-over-year.

• Adjusted free cash flow for 2026 projected at $850–$900 million, with 10% annualized growth through 2028.

• Targeting 5% annual distribution growth through 2028, fully funded by free cash flow.

• Guidance for 2026 and beyond reaffirmed as of December 9, 2025.