Phillips 66 profit jumps on refining gains in third quarter

Phillips 66 (NYSE: PSX) said on Oct. 28 it earned $5.6 billion, or $14.08 per share, in the third quarter, up from $3.8 billion in the second quarter. Refining earnings drove most of the increase.

The company, which manufactures, transports and markets products through its Midstream, Chemicals, Refining, Marketing and Specialties, and Renewable Fuels businesses, said in a press release furnished with its 8-K filing that adjusted earnings were $5.6 billion for the quarter ended Sept. 30.

Here's how the company did:

• Adjusted EPS: $14.08 vs. $9.41 in the second quarter
• Diluted EPS: $14.08 vs. $9.55 in the second quarter
• Sales and other operating revenues: $50.54 billion vs. $51.00 billion in the second quarter
• Adjusted EBITDA: $8.07 billion vs. $5.89 billion in the second quarter
• Cash flow from operations: $7.28 billion vs. $7.26 billion in the second quarter

Segment results

Refining pre-tax income was $6.0 billion, up from $3.1 billion in the second quarter. The company said the increase reflected higher realized margins and volumes, and that margins were driven mainly by a rise in market crack spreads.

Crude capacity utilization in Refining reached 98%, and the Central Corridor processed a record 848 thousand barrels a day of inputs, according to the release.

Midstream pre-tax income was $702 million, down from $785 million in the second quarter, mainly on lower gas transportation margins. Chemicals fell to $311 million from $404 million on lower polyethylene margins.

Marketing and Specialties income dropped to $245 million from $583 million, mainly on lower global marketing fuel margins. Renewable Fuels income fell to $191 million from $544 million, the company said, citing lower margins, inventory impacts and higher costs.

Capital returns and debt

The company returned $2.8 billion to shareholders through dividends and share repurchases in the quarter. Repurchases of common stock totaled $2.27 billion, and dividends paid were $504 million.

“Phillips 66 delivered strong operating performance in the third quarter and is executing on its financial and operating commitments,” said Mark Lashier, chairman and CEO of Phillips 66. “The company remains steadfast in its disciplined approach to capital allocation. We target returning more than 50% of net operating cash flow to shareholders.”

Total debt fell by $2.0 billion to $18.5 billion, and net debt fell by $3.8 billion to $12.7 billion. Cash and cash equivalents were $5.8 billion at the end of the quarter.

Projects

The company reached a final investment decision on the proposed Western Gateway Pipeline system, with an expected in-service date in 2029.

Chevron Phillips Chemical Company LLC expects full operations at the Golden Triangle Polymers Project in Orange, Texas, and the Ras Laffan Polymers Project in Qatar in 2027.

The Coastal Bend expansion is expected to start initial volumes in the fourth quarter of 2026, with full ramp-up to 350 thousand barrels a day in early 2027.

The company said it delivered more than $50 million of near-term synergies following its acquisition of the remaining 50% interest in WRB Refining LP on Oct. 1, 2025.