Antero Midstream Corp 10-Q for FY2025 Q3
Antero Midstream Corp (AM)
About this 10-Q
Antero Midstream Corp filed this 10-Q on October 29, 2025, covering the quarter ended September 30, 2025 (FY2025 Q3).
Headline figures
Quarter ended September 30, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.
- Revenue
- $294.82M
- up 9.2% from $269.87M a year earlier
- Net income
- $115.98M
- up 16.3% from net income of $99.74M a year earlier
- Diluted EPS
- $0.24
- up 14.3% from $0.21 a year earlier
PartnersCapitalAbstract
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission file number:
(Exact name of registrant as specified in its charter)
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(State or other jurisdiction of | | (IRS Employer Identification No.) |
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(Address of principal executive offices) | | (Zip Code) |
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(Registrant’s telephone number, including area code)
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Securities registered pursuant to section 12(b) of the Act: | ||||
Title of each class | | Trading Symbol(s) | | Name of each exchange on which registered |
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Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
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| Accelerated Filer ☐ | |
Non-accelerated Filer ☐ | | Smaller Reporting Company |
Emerging Growth Company | | |
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act)
Number of shares of the registrant’s common stock outstanding as of October 24, 2025 (in thousands):
TABLE OF CONTENTS
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Management’s Discussion and Analysis of Financial Condition and Results of Operations | | 27 | ||
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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
Some of the information in this Quarterly Report on Form 10-Q may contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements, other than statements of historical fact, included in this Quarterly Report on Form 10-Q, regarding our strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects, plans and objectives of management are forward-looking statements. Words such as “may,” “assume,” “forecast,” “position,” “predict,” “strategy,” “expect,” “intend,” “plan,” “estimate,” “anticipate,” “believe,” “project,” “budget,” “potential,” or “continue,” and similar expressions are used to identify forward-looking statements, although not all forward-looking statements contain such identifying words. When considering these forward-looking statements, investors should keep in mind the risk factors and other cautionary statements in this Quarterly Report on Form 10-Q and in our Annual Report on Form 10-K for the year ended December 31, 2024. These forward-looking statements are based on management’s current beliefs, based on currently available information, as to the outcome and timing of future events. Factors that could cause our actual results to differ materially from the results contemplated by such forward-looking statements include:
| ● | Antero Resources Corporation’s (“Antero Resources”) expected production and development plan; |
| ● | our ability to execute our business strategy; |
| ● | impacts to producer customers of insufficient storage capacity; |
| ● | our ability to obtain debt or equity financing on satisfactory terms to fund additional acquisitions, expansion projects, working capital requirements and the repayment or refinancing of indebtedness; |
| ● | natural gas, natural gas liquids (“NGLs”), and oil prices; |
| ● | our ability to realize the anticipated benefits of our investments in unconsolidated affiliates; |
| ● | our ability to execute our share repurchase and dividend programs; |
| ● | our ability to complete the construction of or purchase new gathering and compression, processing, water handling or other assets on schedule, at the budgeted cost or at all, and the ability of such assets to operate as designed or at expected levels; |
| ● | costs of conducting our operations; |
| ● | impacts of geopolitical events, including the conflicts in Ukraine and in the Middle East, and world health events; |
| ● | actions taken by third-party producers, operators, processors and transporters; |
| ● | competition; |
| ● | government regulations and changes in laws; |
| ● | operating hazards, natural disasters, weather-related delays, casualty losses and other matters beyond our control; |
| ● | expectations regarding the amount and timing of litigation awards; |
| ● | pending legal or environmental matters; |
| ● | uncertainty regarding our future operating results; |
| ● | credit markets; |
| ● | our ability to achieve our greenhouse gas reduction targets and the costs associated therewith; |
| ● | general economic conditions; and |
| ● | our other plans, objectives, expectations and intentions contained in this Quarterly Report on Form 10-Q. |
1
We caution investors that these forward-looking statements are subject to all of the risks and uncertainties incidental to our business, most of which are difficult to predict and many of which are beyond our control. These risks include, but are not limited to, commodity price volatility, inflation, supply chain or other disruptions, environmental risks, Antero Resources’ drilling and completion and other operating risks, regulatory changes or changes in law, the uncertainty inherent in projecting Antero Resources’ future rates of production, cash flows and access to capital, the timing of development expenditures, impacts of world health events, cybersecurity risks, the state of markets for, and availability of, verified quality carbon offsets and the other risks described or referenced under the heading “1A. Risk Factors” herein, including the risk factors set forth in our Annual Report on Form 10-K for the year ended December 31, 2024 (the “2024 Form 10-K”), which is on file with the Securities and Exchange Commission (“SEC”).
Should one or more of the risks or uncertainties described or referenced in this Quarterly Report on Form 10-Q occur, or should underlying assumptions prove incorrect, our actual results and plans could differ materially from those expressed in any forward-looking statements.
All forward-looking statements, expressed or implied, included in this Quarterly Report on Form 10-Q are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that we or persons acting on our behalf may issue.
Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q.
2
PART I—FINANCIAL INFORMATION
ANTERO MIDSTREAM CORPORATION
Condensed Consolidated Balance Sheets
(In thousands, except per share amounts)
| | | | | (Unaudited) | | |
| | December 31, |
| September 30, | | ||
|
| 2024 |
| 2025 |
| ||
Assets | |||||||
Current assets: | | | | | | | |
Accounts receivable–Antero Resources | | $ | | | | | |
Accounts receivable–third party | | | | | | | |
Income tax receivable | | | — | | | | |
Other current assets | | | | | | | |
Total current assets | | | | | | | |
Long-term assets: | | | | | | | |
Property and equipment, net | | | | | | | |
Investments in unconsolidated affiliates | | | | | | | |
Customer relationships | | | | | | | |
Other assets, net | | | | | | | |
Total assets | | $ | | | | | |
| | | | | | | |
Liabilities and Stockholders' Equity | |||||||
Current liabilities: | | | | | | | |
Accounts payable–Antero Resources | | $ | | | | | |
Accounts payable–third party | | | | | | | |
Accrued liabilities | | | | | | | |
Other current liabilities | | | | | | | |
Total current liabilities | | | | | | | |
Long-term liabilities: | | | | | | | |
Long-term debt | | | | | | | |
Deferred income tax liability, net | | | | | | | |
Other | | | | | | | |
Total liabilities | | | | | | | |
Stockholders' equity: | | | | | | | |
Preferred stock, $ | | | | | | | |
Series A non-voting perpetual preferred stock; | | | | | | ||
Common stock, $ | | | | | | | |
Additional paid-in capital | | | | | | | |
Retained earnings | | | | | | | |
Total stockholders' equity | | | | | | | |
Total liabilities and stockholders' equity | | $ | | | | | |
See accompanying notes to unaudited condensed consolidated financial statements.
3
ANTERO MIDSTREAM CORPORATION
Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited)
(In thousands, except per share amounts)
| | Three Months Ended September 30, | | ||||
|
| 2024 |
| 2025 | | ||
Revenue: |
| | |
| | | |
Gathering and compression–Antero Resources | | $ | | | | | |
Water handling–Antero Resources | | | | | | | |
Water handling–third party | | | | | | | |
Amortization of customer relationships | | | ( | | | ( | |
Total revenue | | | | | | | |
Operating expenses: | | | | | | | |
Direct operating | | | | | | | |
General and administrative (including $ | | | | | | | |
Facility idling | | | | | | | |
Depreciation | | | | | | | |
Impairment of property and equipment | | | | | | | |
Other operating (income) expense, net | | | ( | | | | |
Total operating expenses | | | | | | | |
Operating income | | | | | | | |
Other income (expense): | | | | | | | |
Interest expense, net | | | ( | | | ( | |
Equity in earnings of unconsolidated affiliates | | | | | | | |
Loss on early extinguishment of debt | | | ( | | | ( | |
Total other expense | | | ( | | | ( | |
Income before income taxes | | | | | | | |
Income tax expense | | | ( | | | ( | |
Net income and comprehensive income | | $ | | | | | |
| | | | | | | |
Net income per common share–basic | | $ | | | | | |
Net income per common share–diluted | | $ | | | | | |
| | | | | | | |
Weighted average common shares outstanding: | | | | | | | |
Basic | | | | | | | |
Diluted | | | | | | | |
See accompanying notes to unaudited condensed consolidated financial statements.
4
ANTERO MIDSTREAM CORPORATION
Condensed Consolidated Statements of Operations and Comprehensive Income (Unaudited)
(In thousands, except per share amounts)
| | Nine Months Ended September 30, | | ||||
|
| 2024 |
| 2025 | | ||
Revenue: |
| | |
| | | |
Gathering and compression–Antero Resources | | $ | | | | | |
Water handling–Antero Resources | | | | | | | |
Water handling–third party | | | | | | | |
Amortization of customer relationships | | | ( | | | ( | |
Total revenue | | | | | | | |
Operating expenses: | | | | | | | |
Direct operating | | | | | | | |
General and administrative (including $ | | | | | | | |
Facility idling | | | | | | | |
Depreciation | | | | | | | |
Impairment of property and equipment | | | | | | | |
Other operating expense, net | | | | | | | |
Total operating expenses | | | | | | | |
Operating income | | | | | | | |
Other income (expense): | | | | | | | |
Interest expense, net | | | ( | | | ( | |
Equity in earnings of unconsolidated affiliates | | | | | | | |
Loss on early extinguishment of debt | | | ( | | | ( | |
Total other expense | | | ( | | | ( | |
Income before income taxes | | | | | | | |
Income tax expense | | | ( | | | ( | |
Net income and comprehensive income | | $ | | | | | |
| | | | | | | |
Net income per common share–basic | | $ | | | | | |
Net income per common share–diluted | | $ | | | | | |
| | | | | | | |
Weighted average common shares outstanding: | | | | | | | |
Basic | | | | | | | |
Diluted | | | | | | | |
See accompanying notes to unaudited condensed consolidated financial statements.
5
ANTERO MIDSTREAM CORPORATION
Condensed Consolidated Statements of Stockholders’ Equity (Unaudited)
(In thousands)
| | | | | | | | | | | | | | ||||||
| | | | | | | | | | | Additional | | | | | | | ||
| | Preferred | | Common Stock | | Paid-In | | Retained | | Total | | ||||||||
| | Stock | | Shares | | Amount | | Capital | | Earnings | | Equity | | ||||||
Balance at December 31, 2023 |
| $ | — | | | | | $ | | | | | | | | | | | |
Dividends to stockholders | | | — | | | — | | | — | | | ( | | | ( | | | ( | |
Equity-based compensation | | | — | | | — | | | — | | | | | | — | | | | |
Issuance of common stock upon vesting of equity-based compensation awards, net of common stock withheld for income taxes | | | — | | | | | | | | | ( | | | — | | | ( | |
Net income and comprehensive income | | | — | | | — | | | — | | | — | | | | | | | |
Balance at March 31, 2024 | | | — | | | | | | | | | | | | | | | | |
Dividends to stockholders | | | — | | | — | | | — | | | ( | | | ( | | | ( | |
Equity-based compensation | | | — | | | — | | | — | | | | | | — | | | | |
Issuance of common stock upon vesting of equity-based compensation awards, net of common stock withheld for income taxes | | | — | | | | | | | | | ( | | | — | | | ( | |
Net income and comprehensive income | | | — | | | — | | | — | | | — | | | | | | | |
Balance at June 30, 2024 | | | — | | | | | | | | | | | | | | | | |
Dividends to stockholders | | | — | | | — | | | — | | | ( | | | ( | | | ( | |
Equity-based compensation | | | — | | | — | | | — | | | | | | — | | | | |
Issuance of common stock upon vesting of equity-based compensation awards, net of common stock withheld for income taxes | | | — | | | | | | | | | ( | | | — | | | ( | |
Net income and comprehensive income | | | — | | | — | | | — | | | — | | | | | | | |
Balance at September 30, 2024 | | $ | — | | | | | $ | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | |
Balance at December 31, 2024 |
| $ | — | | | | | $ | | | | | | | | | | | |
Dividends to stockholders | | | — | | | — | | | — | | | ( | | | ( | | | ( | |
Equity-based compensation | | | — | | | — | | | — | | | | | | — | | | | |
Issuance of common stock upon vesting of equity-based compensation awards, net of common stock withheld for income taxes | | | — | | | | | | | | | ( | | | — | | | ( | |
Repurchases and retirement of common stock | | | — | | | ( | | | ( | | | ( | | | ( | | | ( | |
Net income and comprehensive income | | | — | | | — | | | — | | | — | | | | | | | |
Balance at March 31, 2025 | | | — | | | | | | | | | | | | | | | | |
Dividends to stockholders | | | — | | | — | | | — | | | ( | | | ( | | | ( | |
Equity-based compensation | | | — | | | — | | | — | | | | | | — | | | | |
Issuance of common stock upon vesting of equity-based compensation awards, net of common stock withheld for income taxes | | | — | | | | | | | | | ( | | | — | | | ( | |
Repurchases and retirement of common stock | | | — | | | ( | | | ( | | | ( | | | ( | | | ( | |
Net income and comprehensive income | | | — | | | — | | | — | | | — | | | | | | | |
Balance at June 30, 2025 | | | — | | | | | | | | | | | | | | | | |
Dividends to stockholders | | | — | | | — | | | — | | | — | | | ( | | | ( | |
Equity-based compensation | | | — | | | — | | | — | | | | | | — | | | | |
Issuance of common stock upon vesting of equity-based compensation awards, net of common stock withheld for income taxes | | | — | | | | | | — | | | ( | | | — | | | ( | |
Repurchases and retirement of common stock | | | — | | | ( | | | ( | | | ( | | | ( | | | ( | |
Net income and comprehensive income | | | — | | | — | | | — | | | — | | | | | | | |
Balance at September 30, 2025 | | $ | — | | | | | $ | | | | | | | | | | | |
See accompanying notes to unaudited condensed consolidated financial statements.
6
ANTERO MIDSTREAM CORPORATION
Condensed Consolidated Statements of Cash Flows (Unaudited)
(In thousands)
| | Nine Months Ended September 30, | | ||||
|
| 2024 |
| 2025 |
| ||
Cash flows provided by (used in) operating activities: |
| | |
|
| | |
Net income | | $ | | | | | |
Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | |
Depreciation | | | | | | | |
Impairment of property and equipment | | | | | | | |
Deferred income tax expense | | | | | | | |
Equity-based compensation | | | | | | | |
Equity in earnings of unconsolidated affiliates | | | ( | | | ( | |
Distributions from unconsolidated affiliates | | | | | | | |
Amortization of customer relationships | | | | | | | |
Amortization of deferred financing costs | | | | | | | |
Settlement of asset retirement obligations | | | ( | | | ( | |
Loss on early extinguishment of debt | | | | | | | |
Other operating activities | | | | | | | |
Changes in assets and liabilities: | | | | | | | |
Accounts receivable–Antero Resources | | | ( | | | | |
Accounts receivable–third party | | | | | | | |
Income tax receivable | | | — | | | ( | |
Other current assets | | | | | | ( | |
Accounts payable–Antero Resources | | | | | | ( | |
Accounts payable–third party | | | ( | | | | |
Income taxes payable | | | — | | | | |
Accrued liabilities | | | ( | | | ( | |
Net cash provided by operating activities | | | | | | | |
Cash flows provided by (used in) investing activities: | | | | | | | |
Additions to gathering systems, facilities and other | | | ( | | | ( | |
Additions to water handling systems | | | ( | | | ( | |
Additional investments in unconsolidated affiliate | | | ( | | | ( | |
Acquisition of gathering systems and facilities | | | ( | | | — | |
Other investing activities | | | | | | | |
Net cash used in investing activities | | | ( | | | ( | |
Cash flows provided by (used in) financing activities: | | | | | | | |
Dividends to common stockholders | | | ( | | | ( | |
Dividends to preferred stockholders | | | ( | | | ( | |
Repurchases of common stock | | | — | | | ( | |
Issuance of Senior Notes | | | | | | | |
Redemption of Senior Notes | | | ( | | | ( | |
Payments of deferred financing costs | | | ( | | | ( | |
Borrowings on Credit Facility | | | | | | | |
Repayments on Credit Facility | | | ( | | | ( | |
Employee tax withholding for settlement of equity-based compensation awards | | | ( | | | ( | |
Net cash used in financing activities | | | ( | | | ( | |
Net decrease in cash and cash equivalents | | | ( | | | | |
Cash and cash equivalents, beginning of period | | | | | | — | |
Cash and cash equivalents, end of period | | $ | | | | | |
| | | | | | | |
Supplemental disclosure of cash flow information: | | | | | | | |
Cash paid during the period for interest | | $ | | | | | |
Cash received (paid) during the period for income taxes | | $ | | | | ( | |
Increase in accrued capital expenditures and accounts payable for property and equipment | | $ | | | | | |
See accompanying notes to unaudited condensed consolidated financial statements.
7
ANTERO MIDSTREAM CORPORATION
Notes to Unaudited Condensed Consolidated Financial Statements
(1) Organization
Antero Midstream Corporation together with its consolidated subsidiaries (the “Company” or “Antero Midstream”) is a growth-oriented midstream company formed to own, operate and develop midstream energy infrastructure primarily to service Antero Resources and its production and completion activity in the Appalachian Basin. The Company’s assets consist of gathering pipelines, compressor stations, interests in processing and fractionation plants and water handling assets. Antero Midstream provides midstream services to Antero Resources under long-term contracts. The Company’s corporate headquarters is located in Denver, Colorado.
(2) Summary of Significant Accounting Policies
(a) | Basis of Presentation |
These unaudited condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC applicable to interim financial information and should be read in the context of the Company’s December 31, 2024 consolidated financial statements and notes thereto for a more complete understanding of the Company’s operations, financial position, and accounting policies. The Company’s December 31, 2024 consolidated financial statements were included in the Company’s 2024 Form 10-K, which was filed with the SEC.
These unaudited condensed consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information, and, accordingly, do not include all of the information and footnotes required by GAAP for complete consolidated financial statements. In the opinion of management, these unaudited condensed consolidated financial statements include all adjustments (consisting of normal and recurring accruals) considered necessary to present fairly the Company’s financial position as of December 31, 2024 and September 30, 2025, results of operations for the three and nine months ended September 30, 2024 and 2025 and cash flows for the nine months ended September 30, 2024 and 2025. The Company has no items of other comprehensive income or loss; therefore, net income is equal to comprehensive income.
Certain costs of doing business incurred and charged to the Company by Antero Resources have been reflected in the accompanying unaudited condensed consolidated financial statements. These costs include general and administrative expenses provided to the Company by Antero Resources in exchange for:
| ● | business services, such as payroll, accounts payable and facilities management; |
| ● | corporate services, such as finance and accounting, legal, human resources, investor relations and public and regulatory policy; and |
| ● | employee compensation. |
Transactions between the Company and Antero Resources have been identified in the unaudited condensed consolidated financial statements (see Note 4—Transactions with Affiliates).
(b) | Principles of Consolidation |
The accompanying unaudited condensed consolidated financial statements include the accounts of Antero Midstream Corporation and its wholly owned subsidiaries. All significant intercompany accounts and transactions have been eliminated in the Company’s unaudited condensed consolidated financial statements.
(c) | Income Taxes |
On July 4, 2025, Public Law No. 119-21, commonly referred to as the One Big Beautiful Bill Act (the “OBBB”), was enacted. The OBBB contains a broad range of changes to U.S. federal income tax laws and makes permanent or modifies certain provisions of Public Law No. 115-97, commonly referred to as the Tax Cuts and Jobs Act. These changes include, among others, permanently restoring an earnings before interest, taxes, depreciation and amortization based business interest deduction limitation, 100% bonus depreciation for certain property and immediate expensing for certain domestic research and experimental expenditures. All effects of changes in tax laws are recognized in the condensed consolidated financial statements during the period of enactment. As such, the effects of the OBBB are reflected in the Company's provision for
8
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
income taxes as of and for the three and nine months ended September 30, 2025. The OBBB is not expected to have a material effect on income tax expense for the year ending December 31, 2025, and the Company expects a refund of substantially all of the cash paid for income taxes during the nine months ended September 30, 2025 when it files its U.S. federal income tax return for the year ending December 31, 2025 as a result of the OBBB.
(d) | Recently Adopted or Issued Accounting Standards |
Reportable Segments
In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2023-07, Improvements to Reportable Segment Disclosures (“ASU 2023-07”). ASU 2023-07 is intended to improve reportable segment disclosures primarily through enhanced disclosure of reportable segment expenses. This ASU was effective for annual reporting periods beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024. The Company adopted ASU 2023-07 in the 2024 Form 10-K, and it did not have a material impact on the Company’s consolidated financial statements.
Income Taxes
In December 2023, the FASB issued ASU No. 2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 is intended to improve income tax disclosures primarily through enhanced disclosure of income tax rate reconciliation items, and disaggregation of income (loss) from continuing operations, income tax (expense) benefit and income taxes paid, net disclosures by federal, state and foreign jurisdictions, among others. This ASU is effective for annual reporting periods beginning after December 15, 2024, although early adoption is permitted. ASU 2023-09 should be applied on a prospective basis, although retrospective application is permitted. The Company plans to adopt ASU 2023-09 on a retrospective basis in the Annual Report on Form 10-K for the year ending December 31, 2025. The Company does not expect the adoption of ASU 2023-09 to have a material impact on the Company’s consolidated financial statements.
Disaggregation of Income Statement Expenses
In November 2024, the FASB issued ASU No. 2024-03, Disaggregation of Income Statement Expenses (“ASU 2024-03”). ASU 2024-03 is intended to improve the disclosure about certain operating expenses primarily through enhanced disclosure of cost of sales and selling, general and administrative expenses. This ASU is effective for annual reporting periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. ASU 2024-03 can be applied on either a prospective or a retrospective basis at the Company’s election. The Company is evaluating the impact that ASU 2024-03 will have on the financial statements and its plans for adoption, including its transition method and adoption date.
(3) Intangibles
All customer relationships are subject to amortization and are amortized over a weighted average period of
| | | | (Unaudited) | | ||
| | December 31, | | September 30, | | ||
(in thousands) | | 2024 |
| 2025 | | ||
Gross carrying value of customer relationships | | $ | |
| | | |
Accumulated amortization of customer relationships | | | ( | | | ( | |
Customer relationships | | $ | | | | | |
9
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
Future amortization expense as of September 30, 2025 is as follows (in thousands):
Remainder of year ending December 31, 2025 | | | | | $ | | |
Year ending December 31, 2026 | | | | | | | |
Year ending December 31, 2027 | | | | | | | |
Year ending December 31, 2028 | | | | | | | |
Year ending December 31, 2029 | | | | | | | |
Thereafter | | | | | | | |
Total | | | | | $ | | |
(4) Transactions with Affiliates
(a) | Revenues |
Substantially all revenues earned during the three and nine months ended September 30, 2024 and 2025 were earned from Antero Resources, under various agreements for gathering and compression and water handling services. Revenues earned from gathering and compression services consist of lease income.
(b) | Accounts receivable—Antero Resources and Accounts payable—Antero Resources |
Accounts receivable—Antero Resources represents amounts due from Antero Resources, primarily related to gathering and compression services and water handling services. Accounts payable—Antero Resources represents amounts due to Antero Resources for general and administrative and other costs.
(c) | Allocation of Costs Charged by Antero Resources |
The employees supporting the Company’s operations are concurrently employed by Antero Resources and the Company. Direct operating expense includes costs charged to the Company of $
(5) Revenue
All of the Company’s gathering and compression revenues are derived from operating lease agreements, and all of the Company’s water handling revenues are derived from service contracts with customers. The Company earned substantially all of its revenues from Antero Resources.
(a) | Gathering and Compression |
The Company’s gathering and compression service agreements with Antero Resources include: (i) the second amended and restated gathering and compression agreement dated December 8, 2019 (the “2019 gathering and compression agreement”), (ii) a gathering and compression agreement acquired with the Crestwood Equity Partners LP (“Crestwood”) assets (the “Marcellus gathering and compression agreement”), (iii) a compression agreement acquired with the EnLink Midstream LLC (NYSE: ENLC) (“EnLink”) assets (the “Utica compression agreement”) and (iv) a gathering and compression agreement acquired with the Summit Midstream Partners, LP (NYSE: SMLP) (“Summit”) assets (the “Mountaineer gathering and compression agreement,” and together with the 2019 gathering and compression agreement, the Marcellus gathering and compression agreement and the Utica compression agreement, the “gathering and compression agreements”). See Note 6—Property and Equipment for additional information.
10
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
Pursuant to the gathering and compression agreements, Antero Resources has dedicated substantially all of its current and future acreage in West Virginia, Ohio and Pennsylvania to the Company for gathering and compression services. The 2019 gathering and compression agreement, Marcellus gathering and compression agreement and Mountaineer gathering and compression agreement have initial terms through 2038, 2031 and 2026, respectively, and the Utica compression agreement has
Under the gathering and compression agreements, the Company receives, where applicable, a low pressure gathering fee, a high pressure gathering fee and a compression fee, substantially all of which are subject to annual Consumer Price Index (“CPI”)-based adjustments (or, in the case of the 2019 gathering and compression agreement, the option in certain cases to elect a cost of service fee when such assets are placed in-service). In addition, under the 2019 gathering and compression agreement, the Company receives a reimbursement for certain variable costs, such as electricity and operating expenses.
The Company determined that its gathering and compression agreements are operating leases as Antero Resources obtains substantially all of the economic benefit of the assets and has the right to direct the use of the assets. Each gathering and compression system is an identifiable asset, and consists of a network of assets that may include underground low pressure pipelines that connect and deliver gas from specific well pads to compressor stations to compress the gas before delivery to underground high pressure pipelines that transport the gas to a third-party pipeline, third-party processing plant or a Joint Venture processing plant. Each compression system is an identifiable asset, and consists of a network of assets that include compressor stations that connect to underground high pressure pipelines that transport the gas to a third-party pipeline, third-party processing plant or a Joint Venture processing plant. Each set of assets in an agreement is considered to be a single lease due to the interrelated network of the assets required to provide services under each respective agreement. When a modification to an agreement occurs, the Company reassesses the classification of the lease. The Company accounts for its lease and non-lease components as a single lease component as the lease component is the predominant component. The non-lease components consist of operating, oversight and maintenance of the gathering systems, which are performed on time-elapsed measures.
The 2019 gathering and compression agreement, the Marcellus gathering and compression agreement and the Mountaineer gathering and compression agreement include certain fixed fee provisions. If and to the extent Antero Resources requests that the Company construct new low pressure lines, high pressure lines and/or compressor stations, the 2019 gathering and compression agreement contains options at the Company’s election for either (i) minimum volume commitments that require Antero Resources to utilize or pay for
11
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
The Company recognizes lease income from its minimum lease payments under its gathering and compression agreements on a straight-line basis. Additional variable operating lease income is earned when volumes in excess of the minimum commitments or fees are delivered under the contract. The Company recognizes variable lease income when low pressure volumes are delivered to a compressor station, compression volumes are delivered to a high pressure line and high pressure volumes are delivered to a processing plant or transmission pipeline, as applicable. Minimum volume commitments for the 2019 gathering and compression agreement are aggregated such that the agreement has a single minimum volume commitment for the respective service each year. The Mountaineer gathering and compression agreement minimum compression and gathering fees are not subject to aggregation and are determined on a monthly basis for each compressor station and gathering line, respectively, subject to such agreement. The Company invoices the customer the month after each service is performed, and payment is due in the same month. The Company is not party to any leases that have not commenced.
Minimum future lease cash flows to be received by the Company under the gathering and compression agreements as of September 30, 2025 are as follows (in thousands):
Remainder of year ending December 31, 2025 | | $ | | |
Year ending December 31, 2026 | | | | |
Year ending December 31, 2027 | | | | |
Year ending December 31, 2028 | | | | |
Year ending December 31, 2029 | | | | |
Thereafter | | | | |
Total | | $ | | |
(b) | Water Handling |
The Company is party to a water services agreement with Antero Resources, whereby the Company provides certain water handling services to Antero Resources within an area of dedication in defined service areas in West Virginia and Ohio. The initial term of the water services agreement runs to 2035. Upon completion of the initial term in 2035, the water services agreement will continue in effect from year to year until such time as the agreement is terminated, effective upon an anniversary of the effective date of the agreement, by notice from either the Company or Antero Resources to the other party on or before the
The Company satisfies its performance obligations and recognizes revenue when (i) the fresh water volumes have been delivered to the hydration unit of a specified well pad or (ii) other fluid handling services have been completed. The Company invoices the customer the month after water services are performed, and payment is due in the same month. For services contracted through third-party providers, the Company’s performance obligation is satisfied when the service to be performed by the third-party provider has been completed. The Company invoices the customer after the third-party provider billing is received, and payment is due in the same month.
12
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
Transaction Price Allocated to Remaining Performance Obligations
The Company’s water service agreement with Antero Resources has a term greater than one year. The Company is not required to disclose the transaction price allocated to remaining performance obligations if the variable consideration is allocated entirely to a wholly unsatisfied performance obligation. Under this contract, each unit of product delivered to the customer represents a separate performance obligation; therefore, future volumes are wholly unsatisfied and disclosure of the transaction price allocated to remaining performance obligations is not required.
The Company also performs water services for third-party customers and such contracts are short-term in nature with a contract term of one year or less. Accordingly, the Company is exempt from disclosure of the transaction price allocated to remaining performance obligations if the performance obligation is part of a contract that has an original expected duration of
Contract Balances
Under the Company’s water service contracts, the Company invoices customers after the performance obligations have been satisfied, at which point payment is unconditional. Accordingly, the Company’s water service contracts do not give rise to contract assets or liabilities.
(c) | Disaggregation of Revenue |
In the following table, revenue is disaggregated by type of service and type of fee and is identified by the reportable segment to which such revenues relate. See Note 15—Reportable Segments for additional information.
| | Three Months Ended September 30, | | Nine Months Ended September 30, | | | | ||||||||
(in thousands) | 2024 | | 2025 |
| 2024 | | 2025 |
| Reportable Segment | | |||||
Type of service | | | | | | | | | | | | | | | |
Gathering—low pressure | | $ | | | | | | | | | | | | Gathering and Processing (1) | |
Compression | | | | | | | | | | | | | | Gathering and Processing (1) | |
Gathering—high pressure | | | | | | | | | | | | | | Gathering and Processing (1) | |
Fresh water delivery | | | | | | | | | | | | | | Water Handling | |
Other fluid handling | | | | | | | | | | | | | | Water Handling | |
Amortization of customer relationships | | | ( | | | ( | | | ( | | | ( | | Gathering and Processing | |
Amortization of customer relationships | | | ( | | | ( | | | ( | | | ( | | Water Handling | |
Total | | $ | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
Type of contract | | | | | | | | | | | | | | | |
Per unit fixed fee | | $ | | | | | | | | | | | | Gathering and Processing (1) | |
Per unit fixed fee | | | | | | | | | | | | | | Water Handling | |
Cost plus | | | | | | | | | | | | | | Water Handling | |
Cost of service fee | | | | | | | | | | | | | | Water Handling | |
Amortization of customer relationships | | | ( | | | ( | | | ( | | | ( | | Gathering and Processing | |
Amortization of customer relationships | | | ( | | | ( | | | ( | | | ( | | Water Handling | |
Total | | $ | | | | | | | | | | | | | |
| (1) | Revenue related to the gathering and processing segment is classified as lease income related to the gathering and compression systems. |
The Company’s receivables from its contracts with customers and operating leases as of December 31, 2024 and September 30, 2025, were $
13
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
(6) Property and Equipment
(a) | Summary of Property and Equipment |
Property and equipment, net consisted of the following items:
| | | | | | (Unaudited) | | ||
| | Estimated | | December 31, |
| September 30, | | ||
(in thousands) |
| Useful Lives |
| 2024 |
| 2025 | | ||
Land |
| n/a |
| $ | |
| | | |
Gathering systems and facilities | | | | | | | | | |
Permanent buried pipelines and equipment | | | | | | | | | |
Surface pipelines and equipment | | | | | | | | | |
Heavy trucks and equipment | | | | | | | | | |
Above ground storage tanks | | | | | | | | | |
Other assets | | | | | | | | | |
Construction-in-progress | | n/a | |
| | | | | |
Total property and equipment | | | | | | | | | |
Less accumulated depreciation | | | | | ( | | | ( | |
Property and equipment, net | | | | $ | | | | | |
| (1) | Gathering systems and facilities are recognized as a single-leased asset with |
(b) | Asset Acquisition |
On May 1, 2024, the Company acquired certain Marcellus gas gathering and compression assets from Summit for $
(7) Long-Term Debt
Long-term debt consisted of the following items:
| | | | (Unaudited) | | ||
| | December 31, |
| September 30, | | ||
(in thousands) | | 2024 |
| 2025 | | ||
Credit Facility |
| $ | |
| | | |
| | | | | — | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | — | | | | | |
Total principal | | | | | | | |
Unamortized debt premium | | | | | | — | |
Unamortized debt issuance costs | | | ( | | | ( | |
Total long-term debt | | $ | | | | | |
14
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
(a) | Credit Facility |
On July 30, 2024, Antero Midstream Partners LP (“Antero Midstream Partners”), an indirect, wholly owned subsidiary of Antero Midstream Corporation, as borrower (the “Borrower”), amended and restated its senior secured revolving credit facility with a syndicate of banks. References to the “Credit Facility” refer to the senior secured revolving credit facility in effect for periods prior to July 30, 2024 and the senior secured revolving credit facility in effect on or after July 30, 2024, collectively, as the context requires.
Lender commitments under the Credit Facility were $
The Credit Facility contains negative and affirmative covenants applicable to the Borrower and its restricted subsidiaries customary for credit facilities of this type, including, among other things, limitations on: liens; indebtedness; investments; fundamental changes, such as mergers, consolidations, liquidations and dissolutions; the disposition of assets; transactions with affiliates that are not on arms’-length terms; prepayments and amendments of certain indebtedness; and swap and hedge transactions.
The Credit Facility permits distributions to the holders of the Borrower’s equity interests in accordance with the cash distribution policy, adopted by the board under the partnership agreement of the Borrower, provided that no event of default exists or would be caused thereby, and only to the extent permitted by the Borrower’s organizational documents.
The Credit Facility also requires the Borrower to maintain the following financial ratios:
| ● | other than during an Investment Grade Period (as defined in the Credit Facility) a consolidated interest coverage ratio, which is the ratio of our consolidated EBITDA to its consolidated current interest charges of at least |
| ● | a consolidated total leverage ratio, which is the ratio of consolidated debt to consolidated EBITDA, of not more than |
| ● | after a Financial Covenant Election, a consolidated senior secured leverage ratio covenant in addition to the |
The Borrower was in compliance with all of the financial covenants under the Credit Facility as of December 31, 2024 and September 30, 2025.
The Credit Facility provides for borrowing under either the Adjusted Term Secured Overnight Financing Rate (“”) plus a
15
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
If the Borrower receives at least two Investment Grade Ratings (as defined in the Credit Facility), no default or event of default exists and the Borrower is in pro forma compliance with the Credit Facility’s financial covenants (subject to provision of the Credit Facility), the Borrower may elect to enter into an Investment Grade Period. During an Investment Grade Period, the interest margin is determined by reference to our corporate family rating, which for SOFR loans range from
As of December 31, 2024, the Borrower had outstanding borrowings under the Credit Facility of $
(b) |
On November 10, 2020, Antero Midstream Partners and its wholly owned subsidiary, Antero Midstream Finance Corporation (“Finance Corp,” and together with Antero Midstream Partners, the “Issuers”) issued $
(c) |
On February 25, 2019, the Issuers issued $
(d) |
On June 28, 2019, the Issuers issued $
16
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
(e) |
On June 8, 2021, the Issuers issued $
(f) |
On January 16, 2024, the Issuers issued $
(g) |
On September 22, 2025, the Issuers issued $
(h) | Senior Notes Guarantors |
The Company and each of the Company’s wholly owned subsidiaries (except for the Issuers) has fully and unconditionally guaranteed the 2028 Notes, 2029 Notes, 2032 Notes and 2033 Notes (collectively the “Senior Notes”). In the event a guarantor is sold or disposed of (whether by merger, consolidation, the sale of a sufficient amount of its capital stock so that it no longer qualifies as a Restricted Subsidiary (as defined in the applicable indenture governing the series of Senior Notes) of the Issuer or the sale of all or substantially all of its assets) and whether or not the guarantor is the surviving entity in
17
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
such transaction to a person that is not an Issuer or a Restricted Subsidiary of an Issuer, such guarantor will be released from its obligations under its guarantee if the sale or other disposition does not violate the covenants set forth in the indentures governing the applicable Senior Notes.
In addition, a guarantor will be released from its obligations under the applicable indenture and its guarantee (i) upon the release or discharge of the guarantee of other indebtedness under a credit facility that resulted in the creation of such guarantee, except a release or discharge by or as a result of payment under such guarantee, (ii) if the Issuers designate such subsidiary as an unrestricted subsidiary and such designation complies with the other applicable provisions of the indenture governing the applicable Senior Notes or (iii) in connection with any covenant defeasance, legal defeasance or satisfaction and discharge of the applicable Senior Notes.
During the three and nine months ended September 30, 2024 and 2025, all of the Company’s assets and operations are attributable to the Issuers and its guarantors.
(8) Accrued Liabilities
Accrued liabilities consisted of the following items:
| | | | (Unaudited) | | ||
| | December 31, |
| September 30, | | ||
(in thousands) |
| 2024 |
| 2025 |
| ||
Capital expenditures | | $ | | | | | |
Operating expenses | | | | | | | |
Interest expense | | | | | | | |
Ad valorem taxes | | | | | | | |
Other | | | | | | | |
Total accrued liabilities | | $ | | | | | |
(9) Equity-Based Compensation
(a) | Summary of Equity-Based Compensation |
The Company’s equity-based compensation includes costs related to its long term incentive plans. Antero Midstream’s equity-based compensation expense is included in general and administrative expenses, and recorded as a credit to additional paid-in capital.
On June 5, 2024, the Company’s stockholders approved the Amended and Restated Antero Midstream Corporation Long Term Incentive Plan (the “AM LTIP”). The AM LTIP provides for the grant of stock options, stock appreciation rights, restricted stock, restricted stock units (“RSUs”), dividend equivalents, other stock-based awards, cash awards and substitute awards. The terms and conditions of the awards granted are established by the compensation committee of the Board. As of September 30, 2025, a total of
The Company’s equity-based compensation expense, by type of award, is as follows:
| | Three Months Ended September 30, | | Nine Months Ended September 30, | | ||||||||
(in thousands) | | 2024 | | 2025 | | 2024 | | 2025 | | ||||
Restricted stock units | | $ | | | | | | | | | | | |
Performance share units | | | | | | | | | | | | | |
Equity awards issued to directors | | | | | | | | | | | | | |
Total expense | | $ | | | | | | | | | | | |
18
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
(b) | Restricted Stock Unit Awards |
A summary of the RSU awards activity is as follows:
| | | | Weighted Average | | |
| | Number | | Grant Date | | |
|
| of Units |
| Fair Value | | |
Total awarded and unvested—December 31, 2024 | | | | $ | | |
Granted | | | | | | |
Vested | | ( | | | | |
Forfeited | | ( | | | | |
Total awarded and unvested—September 30, 2025 | | | | $ | | |
As of September 30, 2025, unamortized equity-based compensation expense of $
(c) | Performance Share Unit Awards |
Performance Share Unit Awards Based on Return on Invested Capital
In April 2022, the Company granted performance share units (“PSUs”) to certain of its employees and executive officers that vest based on the Company’s actual return on invested capital (“ROIC”) (as defined in the award agreement) over a
In March 2025, the Company granted PSUs to certain of its executive officers that vest based on the Company’s actual ROIC (as defined in the award agreement) over a
Summary Information for Performance Share Unit Awards
A summary of the PSU awards activity is as follows:
| | | Weighted Average | | ||
| | Number | | Grant Date | | |
|
| of Units |
| Fair Value | | |
Total awarded and unvested—December 31, 2024 | | | | $ | | |
Granted | | | | | | |
Vested | | ( | | | | |
Total awarded and unvested—September 30, 2025 | | | | $ | | |
As of September 30, 2025, unamortized equity-based compensation expense of $
19
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
(10) Cash Dividends
The Company paid cash dividends for the quarter indicated as follows (in thousands, except per share data):
| | | | | | | | Dividends | | ||
Period |
| Record Date |
| Dividend Date |
| Dividends |
| per Share | | ||
Q4 2023 | | | | $ | | | $ | | |||
* | | | | | | | | * | | ||
Q1 2024 | | | | | | | | | |||
* | | | | | | | | * | | ||
Q2 2024 | | | | | | | | | |||
* | | | | | | | | * | | ||
Q3 2024 | | | | | | | | | |||
* | | | | | | | | * | | ||
| | Total 2024 | | | | $ | | | | | |
| | | | | | | | | | | |
Q4 2024 | | | | $ | | | $ | | |||
* | | | | | | | | * | | ||
Q1 2025 | | | | | | | | | |||
* | | | | | | | | * | | ||
Q2 2025 | | | | | | | | | |||
* | | | | | | | | * | | ||
| | Total 2025 | | | | $ | | | | | |
* | Dividends are paid in accordance with the terms of the Series A Preferred Stock (as defined below) as discussed in Note 11—Equity and Net Income Per Common Share. |
On October 8, 2025, the Board announced the declaration of a cash dividend on the shares of the Company’s common stock of $
The Board also declared a cash dividend of $
(11) Equity and Net Income Per Common Share
(a) | Preferred Stock |
The Board authorized
20
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
senior to the Company’s common stock as to dividend rights, as well as with respect to rights upon liquidation, winding-up or dissolution of the Company. Holders of the Series A Preferred Stock do not have any voting rights in the Company, except as required by law, or any preemptive rights.
(b) | Weighted Average Common Shares Outstanding |
The following is a reconciliation of the Company’s basic weighted average common shares outstanding to diluted weighted average common shares outstanding:
| | Three Months Ended September 30, | | Nine Months Ended September 30, | | ||||||||
(in thousands) |
| 2024 | | 2025 |
| 2024 | | 2025 | | ||||
Basic weighted average number of common shares outstanding | | | | | | | | | | | | | |
Add: Dilutive effect of RSUs | | | | | | | | | | | | | |
Add: Dilutive effect of PSUs | | | | | | | | | | | | | |
Add: Dilutive effect of Series A Preferred Stock | | | | | | | | | | | | | |
Diluted weighted average number of common shares outstanding | | | | | | | | | | | | | |
There were
(c) | Net Income Per Common Share |
Net income per common share—basic for each period is computed by dividing the net income or loss attributable to the Company by the basic weighted average number of common shares outstanding during the period. Net income per common share—diluted for each period is computed after giving consideration to the potential dilution from outstanding equity-based awards, calculated using the treasury stock method. During periods in which the Company incurs a net loss, diluted weighted average common shares outstanding are equal to basic weighted average common shares outstanding because the effect of all equity-based awards is anti-dilutive.
| | Three Months Ended September 30, | | Nine Months Ended September 30, | | ||||||||
(in thousands, except per share amounts) |
| 2024 | | 2025 |
| 2024 | | 2025 | | ||||
Net income | | $ | | | | | | | | | | | |
Less preferred stock dividends | | | ( | | | ( | | | ( | | | ( | |
Net income available to common shareholders | | $ | | | | | | | | | | | |
| | | | | | | | | | | | | |
Net income per common share–basic | | $ | | | | | | | | | | | |
Net income per common share–diluted | | $ | | | | | | | | | | | |
| | | | | | | | | | | | | |
Weighted average common shares outstanding–basic | | | | | | | | | | | | | |
Weighted average common shares outstanding–diluted | | | | | | | | | | | | | |
(12) Fair Value Measurement
The carrying values on the condensed consolidated balance sheets of the Company’s accounts receivable—Antero Resources, accounts receivable—third party, other current assets, accounts payable—Antero Resources, accounts payable—third party, accrued liabilities and other current liabilities approximate fair values due to their short-term maturities. The carrying value of the amounts under the Credit Facility as of December 31, 2024 and September 30, 2025 approximated fair value because the variable interest rates are reflective of current market conditions.
21
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
The fair value and carrying value of the Company’s Senior Notes is as follows:
| | | | | | | | (Unaudited) | | ||||
| | December 31, 2024 | | September 30, 2025 | | ||||||||
(in thousands) | | Fair Value (1) | | Carrying Value (2) | | Fair Value (1) | | Carrying Value (2) | | ||||
2027 Notes | | $ | | | | | | — | | | — | | |
2028 Notes | | | | | | | | | | | | | |
2029 Notes | | | | | | | | | | | | | |
2032 Notes | | | | | | | | | | | | | |
2033 Notes | | | — | | | — | | | | | | | |
Total | | $ | | | | | | | | | | | |
| (1) | Fair values are based on Level 2 market data inputs. |
| (2) | Carrying values are presented net of unamortized debt issuance costs and debt premium. |
(13) Investments in Unconsolidated Affiliates
The Company has a
The Company also has a
The Company’s net income includes its proportionate share of the net income of the Joint Venture and Stonewall. When the Company records its proportionate share of net income, it increases equity income in the unaudited condensed consolidated statements of operations and comprehensive income and the carrying value of that investment on its condensed consolidated balance sheet. When distributions on the Company’s proportionate share of net income are received, they are recorded as reductions to the carrying value of the investment on the unaudited condensed consolidated balance sheet and are classified as cash inflows from operating activities in accordance with the nature of the distribution approach under Financial Accounting Standards Board Accounting Standard Codification Topic 230, Statement of Cash Flows. The Company uses the equity method of accounting to account for its investments in the Joint Venture and Stonewall because it exercises significant influence, but not control, over the entities. The Company’s judgment regarding the level of influence over its equity investments includes considering key factors such as its ownership interest, representation on the applicable Board of Directors and participation in policy-making decisions of the Joint Venture and Stonewall.
The following table is a reconciliation of the Company’s investments in these unconsolidated affiliates:
| | | | | | | Total Investment | | ||
| | | | | | | | in Unconsolidated | | |
(in thousands) |
| Joint Venture |
| Stonewall |
| Affiliates | | |||
Balance as of December 31, 2024 | | $ | | | | | | | | |
Additional investments | | | — | | | | | | | |
Equity in earnings of unconsolidated affiliates (1) | | | | | | | | | | |
Distributions from unconsolidated affiliates | | | ( | | | ( | | | ( | |
Balance as of September 30, 2025 | | $ | | | | | | | | |
| (1) | As adjusted for the amortization of the difference between the cost of the equity investments in Stonewall and the Joint Venture and the amount of the underlying equity in the net assets of the Joint Venture and Stonewall as of March 12, 2019. |
22
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
(14) Contingencies
The Company is currently involved in a consolidated lawsuit with Veolia Water Technologies, Inc. (“Veolia”) relating to the Clearwater Facility.
On March 13, 2020, Antero Treatment LLC (“Antero Treatment”), a wholly owned subsidiary of the Company, filed suit against Veolia in the district court of Denver County, Colorado (the “Court”), asserting claims of fraud, breach of contract and other related claims. Antero Treatment alleges that Veolia failed to meet its contractual obligations to design and build a “turnkey” wastewater disposal facility under a Design/Build Agreement dated August 18, 2015 (the “DBA”), and that Veolia fraudulently concealed certain miscalculations and design flaws during contract negotiations and continued to conceal and fraudulently misrepresent the impact of certain design changes post-execution of the DBA. On March 13, 2020, Veolia filed a separate suit against the Company, Antero Resources, and certain of the Company’s wholly owned subsidiaries (collectively, the “Antero Defendants”) in Denver County, Colorado. In its lawsuit, Veolia asserted breach of contract and equitable claims against the Antero Defendants for alleged failures under the DBA. Veolia’s suit was consolidated into the action filed by Antero Treatment.
Veolia and the Antero Defendants each filed partial motions to dismiss and motions for summary judgment directed at certain claims asserted by the opposing party. A bench trial on the remaining claims was held from January 24 through February 10, 2022 and concluded on February 24, 2022. At trial, Antero Treatment sought damages from Veolia of $
On January 3, 2023, the Court found that Antero Treatment had prevailed on its claims for breach of contract and fraud, and awarded $
23
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
(15) Reportable Segments
The Company’s operations, which are located in the United States, are organized into
The summarized operating results of the Company’s reportable segments are as follows:
| | Three Months Ended September 30, 2024 | | ||||||||||
| | Gathering and | | Water | | | | Consolidated | | ||||
(in thousands) |
| Processing |
| Handling |
| Unallocated (1) |
| Total | | ||||
Revenues: | | | | | | | | | | | | | |
Revenue–Antero Resources | | $ | | | | | | | — | | | | |
Revenue–third-party | | | — | | | | | | — | | | | |
Amortization of customer relationships | | | ( | | | ( | | | — | | | ( | |
Total revenues | | | | | | | | | — | | | | |
Operating expenses: | | | | | | | | | | | | | |
Direct operating | | | | | | | | | — | | | | |
General and administrative (excluding equity-based compensation) | | | | | | | | | | | | | |
Equity-based compensation | | | | | | | | | | | | | |
Facility idling | | | — | | | | | | — | | | | |
Depreciation | | | | | | | | | — | | | | |
Impairment of property and equipment | | | | | | — | | | — | | | | |
Other (2) | | | — | | | ( | | | — | | | ( | |
Total operating expenses | | | | | | | | | | | | | |
Operating income (loss) | | $ | | | | ( | | | ( | | | | |
| | | | | | | | | | | | | |
Equity in earnings of unconsolidated affiliates | | $ | | | | — | | | — | | | | |
Additions to property and equipment | | $ | | | | | | | — | | | | |
| (1) | Certain expenses that are not directly attributable to gathering and processing and water handling are managed and evaluated on a consolidated basis. |
| (2) |
24
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
| | Three Months Ended September 30, 2025 | | ||||||||||
| | Gathering and | | Water | | | | Consolidated | | ||||
(in thousands) |
| Processing |
| Handling |
| Unallocated (1) |
| Total | | ||||
Revenues: | | | | | | | | | | | | | |
Revenue–Antero Resources | | $ | | | | | | | — | | | | |
Revenue–third-party | | | — | | | | | | — | | | | |
Amortization of customer relationships | | | ( | | | ( | | | — | | | ( | |
Total revenues | | | | | | | | | — | | | | |
Operating expenses: | | | | | | | | | | | | | |
Direct operating | | | | | | | | | — | | | | |
General and administrative (excluding equity-based compensation) | | | | | | | | | | | | | |
Equity-based compensation | | | | | | | | | | | | | |
Facility idling | | | — | | | | | | — | | | | |
Depreciation | | | | | | | | | — | | | | |
Impairment of property and equipment | | | — | | | | | | — | | | | |
Other (2) | | | — | | | | | | — | | | | |
Total operating expenses | | | | | | | | | | | | | |
Operating income | | $ | | | | | | | ( | | | | |
| | | | | | | | | | | | | |
Equity in earnings of unconsolidated affiliates | | $ | | | | — | | | — | | | | |
Additions to property and equipment | | $ | | | | | | | — | | | | |
| (1) | Certain expenses that are not directly attributable to gathering and processing and water handling are managed and evaluated on a consolidated basis. |
| (2) |
| | Nine Months Ended September 30, 2024 | | ||||||||||
| | Gathering and | | Water | | | | Consolidated | | ||||
(in thousands) |
| Processing |
| Handling |
| Unallocated (1) | | Total | | ||||
Revenues: | | | | | | | | | | | | | |
Revenue–Antero Resources | | $ | | | | | | | — | | | | |
Revenue–third-party | | | — | | | | | | — | | | | |
Amortization of customer relationships | | | ( | | | ( | | | — | | | ( | |
Total revenues | | | | | | | | | — | | | | |
Operating expenses: | | | | | | | | | | | | | |
Direct operating | | | | | | | | | — | | | | |
General and administrative (excluding equity-based compensation) | | | | | | | | | | | | | |
Equity-based compensation | | | | | | | | | | | | | |
Facility idling | | | — | | | | | | — | | | | |
Depreciation | | | | | | | | | — | | | | |
Impairment of property and equipment | | | | | | — | | | — | | | | |
Other (2) | | | — | | | | | | — | | | | |
Total operating expenses | | | | | | | | | | | | | |
Operating income | | $ | | | | | | | ( | | | | |
| | | | | | | | | | | | | |
Equity in earnings of unconsolidated affiliates | | $ | | | | — | | | — | | | | |
Additions to property and equipment | | $ | | | | | | | — | | | | |
| (1) | Certain expenses that are not directly attributable to gathering and processing and water handling are managed and evaluated on a consolidated basis. |
| (2) |
25
ANTERO MIDSTREAM CORPORATION
Notes to the Unaudited Condensed Consolidated Financial Statements (Continued)
| | | | | | | | | | | | | |
| | Nine Months Ended September 30, 2025 | | ||||||||||
| | Gathering and | | Water | | | | Consolidated | | ||||
(in thousands) |
| Processing |
| Handling |
| Unallocated (1) | | Total | | ||||
Revenues: | | | | | | | | | | | | | |
Revenue–Antero Resources | | $ | | | | | | | — | | | | |
Revenue–third-party | | | — | | | | | | — | | | | |
Amortization of customer relationships | | | ( | | | ( | | | — | | | ( | |
Total revenues | | | | | | | | | — | | | | |
Operating expenses: | | | | | | | | | | | | | |
Direct operating | | | | | | | | | — | | | | |
General and administrative (excluding equity-based compensation) | | | | | | | | | | | | | |
Equity-based compensation | | | | | | | | | | | | | |
Facility idling | | | — | | | | | | — | | | | |
Depreciation | | | | | | | | | — | | | | |
Impairment of property and equipment | | | — | | | | | | — | | | | |
Other (2) | | | — | | | | | | — | | | | |
Total operating expenses | | | | | | | | | | | | | |
Operating income | | $ | | | | | | | ( | | | | |
| | | | | | | | | | | | | |
Equity in earnings of unconsolidated affiliates | | $ | | | | — | | | — | | | | |
Additions to property and equipment | | $ | | | | | | | — | | | | |
| (1) | Certain expenses that are not directly attributable to gathering and processing and water handling are managed and evaluated on a consolidated basis. |
| (2) |
The summarized total assets of the Company’s reportable segments are as follows:
| | As of December 31, 2024 | | ||||||||||
| | Gathering and | | Water | | | | Consolidated | | ||||
(in thousands) |
| Processing |
| Handling |
| Unallocated | | Total | | ||||
Investments in unconsolidated affiliates | | $ | | | | — | | | — | | | | |
Total assets | | | | | | | | | — | | | | |
| | (Unaudited) | | ||||||||||
| | As of September 30, 2025 | | ||||||||||
| | Gathering and | | Water | | | | Consolidated | | ||||
(in thousands) |
| Processing |
| Handling |
| Unallocated (1) | | Total | | ||||
Investments in unconsolidated affiliates | | $ | | | | — | | | — | | | | |
Total assets | | | | | | | | | | | | | |
| (1) | Certain assets that are not directly attributable to gathering and processing and water handling are managed and evaluated on a consolidated basis. |
26
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes included elsewhere in this report. The information provided below supplements, but does not form part of, our unaudited condensed consolidated financial statements. This discussion contains forward-looking statements that are based on the views and beliefs of our management, as well as assumptions and estimates made by our management. Actual results could differ materially from such forward-looking statements as a result of various risk factors, including those that may not be in the control of management. For further information on items that could impact our future operating performance or financial condition, see “Item 1A. Risk Factors” and the section entitled “Cautionary Statement Regarding Forward-Looking Statements.” We do not undertake any obligation to publicly update any forward-looking statements except as otherwise required by applicable law. In this section, references to “Antero Midstream,” “AM,” the “Company,” “we,” “us,” and “our” refer to Antero Midstream Corporation and its consolidated subsidiaries, unless otherwise indicated or the context otherwise requires.
Overview
We are a growth-oriented midstream energy company formed to own, operate and develop midstream energy assets to primarily service Antero Resources’ production and completion activity. We believe that our strategically located assets and our relationship with Antero Resources have allowed us to become a leading midstream energy company serving the Appalachian Basin and present opportunities to expand our midstream services to other operators in the Appalachian Basin. Our assets consist of gathering pipelines, compressor stations and interests in processing and fractionation plants that collect and process production from Antero Resources’ wells in the Appalachian Basin in West Virginia and Ohio. Our assets also include two independent water handling systems that deliver water from the Ohio River and several regional waterways. These water handling systems consist of permanent buried pipelines, surface pipelines and water storage facilities, as well as pumping stations, blending facilities and impoundments. Portions of these water handling systems are also utilized to transport flowback and produced water. These services are provided by us directly or through third-parties with which we contract.
Financing Highlights
Senior Notes
Issuance of 2033 Notes
On September 22, 2025, we issued $650 million of 2033 Notes at par. The 2033 Notes are unsecured and effectively subordinated to the Credit Facility to the extent of the value of the collateral securing the Credit Facility. The 2033 Notes rank pari passu to our other outstanding senior notes and are guaranteed on a full and unconditional and joint and several senior unsecured basis by our wholly owned subsidiaries and certain of our future restricted subsidiaries. The net proceeds from this offering were used to redeem the 2027 Notes. See Note 7—Long-Term Debt to the unaudited condensed consolidated financial statements for more information.
Redemption of 2027 Notes
During the nine months ended September 30, 2025, we redeemed $650 million aggregate principal amount of our 2027 Notes at par, plus accrued and unpaid interest. The 2027 Notes were retired as of September 23, 2025. See Note 7—Long-Term Debt to the unaudited condensed consolidated financial statements for more information.
Share Repurchase Program
Through our share repurchase program, during the three and nine months ended September 30, 2025, we repurchased and retired approximately 2 million and 5 million shares of our common stock, respectively, for a total cost of $41 million and $87 million, respectively. As of September 30, 2025, we have approximately $385 million of capacity remaining under our share repurchase program. The shares may be repurchased from time to time in open market transactions, through privately negotiated transactions or by other means in accordance with federal securities laws. The timing, as well as the number and value of shares repurchased under the program, will be determined by us at our discretion and will depend on a variety of factors, including the market price of our common stock, general market and economic conditions and applicable legal requirements. The exact number of shares to be repurchased by us is not guaranteed and the program may be suspended, modified or discontinued at any time without prior notice.
27
Market Conditions and Business Trends
Commodity Markets
Benchmark prices for natural gas and ethane increased significantly, while benchmark prices for C3+ NGL’s and oil decreased during the three and nine months ended September 30, 2025 as compared to the same periods of 2024. While substantially all of our revenues are based on fixed-fee contracts that are not directly impacted by changes in commodity prices, commodity price changes do impact the revenues and cash flows of Antero Resources, and Antero Resources’ drilling and development plan does have a direct impact on our gathering, compression and water handling services, revenues and cash flows. In the current economic environment, we expect that commodity prices for some or all of the commodities produced by Antero Resources could remain volatile. However, due to Antero Resources’ improved liquidity and leverage position as compared to historical levels together with Antero Resources’ increased commodity derivative portfolio, we do not expect to experience significant variability in our throughput volumes resulting from volatile commodity prices.
Economic Indicators
The economy experienced elevated inflation levels as a result of global supply and demand imbalances, where global demand outpaced supplies beginning in 2021 and continuing through 2024. In order to manage the inflation risk present in the United States’ economy, the Federal Reserve utilized monetary policy in the form of interest rate increases beginning in 2022 in an effort to bring the inflation rate in line with its stated goal of 2% on a long-term basis. Between 2022 and 2023, the Federal Reserve increased the federal funds interest rate by 5.25%. During the second half of 2024, inflation rates began to approach the Federal Reserve’s stated goal of 2%, and the Federal Reserve decreased the federal funds rate by 1.25% in 2024 and 2025. While inflationary pressures in the United States’ economy have begun to subside, it is uncertain what impact recent tariff activity by the United States and foreign governments will have on inflation.
The economy also continues to be impacted by global events. These events have often caused global supply chain disruptions with additional pressure due to trade sanctions, tariffs, other global trade restrictions and the outbreak of armed conflict, including in the Middle East and Iran, among others. While neither our nor Antero Resources’ supply chain has experienced any significant interruptions due to such events, there can be no assurance that we will not experience interruptions in the future.
Inflationary pressures and supply chain disruptions could result in further increases to our operating and capital costs that are not fixed. However, our gathering and compression and water agreements provide for annual CPI-based adjustments that mitigate a portion of such inflationary pressures.
These economic variables are beyond our control and may adversely impact our business, financial condition, results of operations and future cash flows.
Results of Operations
We have two reportable segments: (i) gathering and processing and (ii) water handling. The gathering and processing segment includes a network of gathering pipelines and compressor stations that collect and process production from Antero Resources’ wells in the Appalachian Basin, as well as equity in earnings from our investments in the Joint Venture and Stonewall. The Joint Venture and Stonewall provide processing and fractionation services and high-pressure gas gathering services, respectively, in the Appalachian Basin. The water handling segment includes (i) two independent systems that deliver water from sources including the Ohio River, local reservoirs and several regional waterways, and (ii) other fluid handling services, which include high rate transfer, wastewater transportation, disposal and blending. See Note 15—Reportable Segments to our unaudited condensed consolidated financial statements for additional information.
28
Three Months Ended September 30, 2024 Compared to Three Months Ended September 30, 2025
The operating results of our reportable segments are as follows:
| | Three Months Ended September 30, 2024 | | ||||||||||
| | Gathering and | | Water | | | | Consolidated | | ||||
(in thousands) |
| Processing |
| Handling |
| Unallocated (1) |
| Total | | ||||
Revenues: | | | | | | | | | | | | | |
Revenue–Antero Resources | | $ | 234,847 | | | 52,294 | | | — | | | 287,141 | |
Revenue–third-party | | | — | | | 397 | | | — | | | 397 | |
Amortization of customer relationships | | | (9,271) | | | (8,397) | | | — | | | (17,668) | |
Total revenues | | | 225,576 | | | 44,294 | | | — | | | 269,870 | |
Operating expenses: | | | | | | | | | | | | | |
Direct operating | | | 24,516 | | | 27,208 | | | — | | | 51,724 | |
General and administrative (excluding equity-based compensation) | | | 7,495 | | | 2,203 | | | 1,229 | | | 10,927 | |
Equity-based compensation | | | 9,591 | | | 2,105 | | | 249 | | | 11,945 | |
Facility idling | | | — | | | 405 | | | — | | | 405 | |
Depreciation | | | 18,632 | | | 13,902 | | | — | | | 32,534 | |
Impairment of property and equipment | | | 332 | | | — | | | — | | | 332 | |
Other operating income, net | | | — | | | (424) | | | — | | | (424) | |
Total operating expenses | | | 60,566 | | | 45,399 | | | 1,478 | | | 107,443 | |
Operating income (loss) | | | 165,010 | | | (1,105) | | | (1,478) | | | 162,427 | |
Other income (expense): | | | | | | | | | | | | | |
Interest expense, net | | | — | | | — | | | (51,812) | | | (51,812) | |
Equity in earnings of unconsolidated affiliates | | | 27,668 | | | — | | | — | | | 27,668 | |
Loss on early extinguishment of debt | | | — | | | — | | | (341) | | | (341) | |
Total other income (expense) | | | 27,668 | | | — | | | (52,153) | | | (24,485) | |
Income (loss) before income taxes | | | 192,678 | | | (1,105) | | | (53,631) | | | 137,942 | |
Income tax expense | | | — | | | — | | | (38,202) | | | (38,202) | |
Net income (loss) and comprehensive income (loss) | | $ | 192,678 | | | (1,105) | | | (91,833) | | | 99,740 | |
| (1) | Corporate expenses that are not directly attributable to either the gathering and processing or water handling segments. |
29
| | Three Months Ended September 30, 2025 | | ||||||||||
| | Gathering and | | Water | | | | Consolidated | | ||||
(in thousands) |
| Processing |
| Handling |
| Unallocated (1) |
| Total | | ||||
Revenues: | | | | | | | | | | | | | |
Revenue–Antero Resources | | $ | 249,827 | | | 62,129 | | | — | | | 311,956 | |
Revenue–third-party | | | — | | | 533 | | | — | | | 533 | |
Amortization of customer relationships | | | (9,271) | | | (8,397) | | | — | | | (17,668) | |
Total revenues | | | 240,556 | | | 54,265 | | | — | | | 294,821 | |
Operating expenses: | | | | | | | | | | | | | |
Direct operating | | | 29,077 | | | 28,809 | | | — | | | 57,886 | |
General and administrative (excluding equity-based compensation) | | | 5,670 | | | 2,903 | | | 1,717 | | | 10,290 | |
Equity-based compensation | | | 7,662 | | | 3,079 | | | 285 | | | 11,026 | |
Facility idling | | | — | | | 445 | | | — | | | 445 | |
Depreciation | | | 19,419 | | | 15,046 | | | — | | | 34,465 | |
Impairment of property and equipment | | | — | | | 167 | | | — | | | 167 | |
Other operating expense, net | | | — | | | 49 | | | — | | | 49 | |
Total operating expenses | | | 61,828 | | | 50,498 | | | 2,002 | | | 114,328 | |
Operating income | | | 178,728 | | | 3,767 | | | (2,002) | | | 180,493 | |
Other income (expense): | | | | | | | | | | | | | |
Interest expense, net | | | — | | | — | | | (47,196) | | | (47,196) | |
Equity in earnings of unconsolidated affiliates | | | 29,688 | | | — | | | — | | | 29,688 | |
Loss on early extinguishment of debt | | | — | | | — | | | (1,313) | | | (1,313) | |
Total other income (expense) | | | 29,688 | | | — | | | (48,509) | | | (18,821) | |
Income before income taxes | | | 208,416 | | | 3,767 | | | (50,511) | | | 161,672 | |
Income tax expense | | | — | | | — | | | (45,688) | | | (45,688) | |
Net income and comprehensive income | | $ | 208,416 | | | 3,767 | | | (96,199) | | | 115,984 | |
| (1) | Corporate expenses that are not directly attributable to either the gathering and processing or water handling segments. |
30
The operating data for Antero Midstream is as follows:
| | | | | | | | Amount of | | | | | | |
| | Three Months Ended September 30, | | Increase | | Percentage | | |||||||
|
| 2024 |
| 2025 |
| or Decrease |
| Change | | |||||
Operating Data: | | | | | | | | | | | | | | |
Gathering—low pressure (MMcf) | | | 301,468 | | | 315,719 | | | 14,251 | | | 5 | % | |
Compression (MMcf) | | | 300,790 | | | 314,729 | | | 13,939 | | | 5 | % | |
Gathering—high pressure (MMcf) | | | 280,189 | | | 291,637 | | | 11,448 | | | 4 | % | |
Fresh water delivery (MBbl) | | | 6,514 | | | 8,472 | | | 1,958 | | | 30 | % | |
Other fluid handling (MBbl) | | | 4,751 | | | 4,966 | | | 215 | | | 5 | % | |
Wells serviced by fresh water delivery | | | 9 | | | 17 | | | 8 | | | 89 | % | |
Gathering—low pressure (MMcf/d) | | | 3,277 | | | 3,432 | | | 155 | | | 5 | % | |
Compression (MMcf/d) | | | 3,269 | | | 3,421 | | | 152 | | | 5 | % | |
Gathering—high pressure (MMcf/d) | | | 3,046 | | | 3,170 | | | 124 | | | 4 | % | |
Fresh water delivery (MBbl/d) | | | 71 | | | 92 | | | 21 | | | 30 | % | |
Other fluid handling (MBbl/d) | | | 52 | | | 54 | | | 2 | | | 4 | % | |
Average Realized Fees(1): | | | | | | | | | | | | | | |
Average gathering—low pressure fee ($/Mcf) | | $ | 0.36 | | | 0.36 | | | — | | | * | | |
Average compression fee ($/Mcf) | | $ | 0.21 | | | 0.22 | | | 0.01 | | | 5 | % | |
Average gathering—high pressure fee ($/Mcf) | | $ | 0.23 | | | 0.23 | | | — | | | * | | |
Average fresh water delivery fee ($/Bbl) | | $ | 4.31 | | | 4.37 | | | 0.06 | | | 1 | % | |
Joint Venture Operating Data: | | | | | | | | | | | | | | |
Processing—Joint Venture (MMcf) | | | 149,039 | | | 157,696 | | | 8,657 | | | 6 | % | |
Fractionation—Joint Venture (MBbl) | | | 3,680 | | | 3,680 | | | — | | | * | | |
Processing—Joint Venture (MMcf/d) | | | 1,620 | | | 1,714 | | | 94 | | | 6 | % | |
Fractionation—Joint Venture (MBbl/d) | | | 40 | | | 40 | | | — | | | * | | |
| * | Not meaningful or applicable. |
| (1) | The average realized fees for the three months ended September 30, 2025 include annual CPI-based adjustments of approximately 1.6%. |
Revenues. Total revenues increased by 9%, from $270 million for the three months ended September 30, 2024 to $295 million for the three months ended September 30, 2025. Total revenues included amortization of customer relationships of $18 million for the three months ended September 30, 2024 and 2025. Gathering and processing revenues increased by 7%, from $226 million for the three months ended September 30, 2024 to $241 million for the three months ended September 30, 2025. Water handling revenues increased by 23%, from $44 million for the three months ended September 30, 2024 to $54 million for the three months ended September 30, 2025. These fluctuations primarily resulted from the following:
Gathering and Processing
| ● | Low pressure gathering revenue increased $7 million period over period primarily due to increased throughput volumes of 14 Bcf, or 155 MMcf/d, and increased low pressure gathering rates as a result of annual CPI-based adjustments. Low pressure gathering volumes increased between periods primarily due to 65 additional wells being connected to our system since September 30, 2024, partially offset by natural production decline of the wells connected to our system between periods. |
| ● | Compression revenue increased $4 million period over period primarily due to increased throughput volumes of 14 Bcf, or 152 MMcf/d, and increased compression rates as a result of annual CPI-based adjustments. Compression volumes increased between periods primarily due to 65 additional wells being connected to our system since September 30, 2024, partially offset by natural production decline of the wells connected to our system between periods. |
| ● | High pressure gathering revenue increased $4 million period over period primarily due to increased throughput volumes of 11 Bcf, or 124 MMcf/d, and increased high pressure gathering rates as a result of annual CPI-based adjustments. High pressure gathering volumes increased between periods primarily due to 65 additional wells being connected to our system since September 30, 2025, partially offset by natural production decline of the wells connected to our system between periods. |
31
Water Handling
| ● | Fresh water delivery revenue increased $9 million period over period primarily due to increased fresh water delivery volumes of 2 MMBbl, or 21 MBbl/d, and an increase to the fresh water delivery rate as a result of an annual CPI-based adjustment. |
| ● | Other fluid handling services revenue increased $1 million period over period primarily due to increased other fluid handling volumes between periods. |
Direct operating expenses. Direct operating expenses increased by 12%, from $52 million for the three months ended September 30, 2024 to $58 million for the three months ended September 30, 2025. Gathering and processing direct operating expenses increased by 19% from $25 million for the three months ended September 30, 2024 to $29 million for the three months ended September 30, 2025 primarily due to increased gathering and compression volumes and increased heavy maintenance expense between periods. Water handling direct operating expenses increased by 6%, from $27 million for the three months ended September 30, 2024 to $29 million for the three months ended September 30, 2025 primarily due to increased fresh water delivery and other fluid handling volumes between periods.
General and administrative (excluding equity-based compensation) expenses. General and administrative expenses (excluding equity-based compensation expense) remained relatively consistent at $11 million and $10 million for the three months ended September 30, 2024 and 2025, respectively.
Equity-based compensation expenses. Equity-based compensation expenses remained relatively consistent at $12 million and $11 million for the three months ended September 30, 2024 and 2025, respectively. See Note 9—Equity-Based Compensation to the unaudited condensed consolidated financial statements for additional information.
Depreciation expense. Depreciation expense remained relatively consistent at $33 million and $34 million for the three months ended September 30, 2024 and 2025, respectively.
Interest expense. Interest expense decreased by 9%, from $52 million for the three months ended September 30, 2024 to $47 million for the three months ended September 30, 2025 primarily due to lower average daily Credit Facility borrowings and interest rates between periods.
Equity in earnings of unconsolidated affiliates. Equity in earnings of unconsolidated affiliates increased by 7%, from $28 million for the three months ended September 30, 2024 to $30 million for the three months ended September 30, 2025 primarily due to increased processing volumes and higher processing and fractionation fees as a result of annual CPI-based adjustments between periods.
Loss on early extinguishment of debt. During the three months ended September 30, 2024, we recognized a loss on early extinguishment of debt of less than $1 million related to the amendment and restatement of our Credit Facility. During the three months ended September 30, 2025, we recognized a loss on early extinguishment of debt of $1 million related to the write-off of unamortized deferred financing costs and premium attributable to our 2027 Notes that were fully redeemed at par, plus accrued and unpaid interest, during the period. See Note 7—Long-Term Debt to the unaudited condensed consolidated financial statements for additional information.
Income tax expense. Income tax expense increased by 20%, from $38 million for the three months ended September 30, 2024 to $46 million for the three months ended September 30, 2025, which reflects effective tax rates of 27.7% and 28.3%, respectively. This income tax expense increase was primarily due to higher income before income taxes between periods. The increase in our effective tax rate between periods was primarily due to the effects of equity-based compensation expense. See Note 2—Summary of Significant Accounting Policies to the unaudited condensed consolidated financial statements for additional information on the effects of the OBBB.
32
Nine Months Ended September 30, 2024 Compared to Nine Months Ended September 30, 2025
The operating results of our reportable segments were as follows:
| | Nine Months Ended September 30, 2024 | | ||||||||||
| | Gathering and | | Water | | | | Consolidated | | ||||
(in thousands) |
| Processing |
| Handling |
| Unallocated (1) |
| Total | | ||||
Revenues: | | | | | | | | | | | | | |
Revenue–Antero Resources | | $ | 691,433 | | | 178,805 | | | — | | | 870,238 | |
Revenue–third-party | | | — | | | 1,482 | | | — | | | 1,482 | |
Amortization of customer relationships | | | (27,814) | | | (25,190) | | | — | | | (53,004) | |
Total revenues | | | 663,619 | | | 155,097 | | | — | | | 818,716 | |
Operating expenses: | | | | | | | | | | | | | |
Direct operating | | | 76,849 | | | 85,202 | | | — | | | 162,051 | |
General and administrative (excluding equity-based compensation) | | | 21,840 | | | 6,742 | | | 3,859 | | | 32,441 | |
Equity-based compensation | | | 26,341 | | | 5,782 | | | 748 | | | 32,871 | |
Facility idling | | | — | | | 1,339 | | | — | | | 1,339 | |
Depreciation | | | 65,661 | | | 41,544 | | | — | | | 107,205 | |
Impairment of property and equipment | | | 332 | | | — | | | — | | | 332 | |
Other operating expense | | | — | | | 1,046 | | | — | | | 1,046 | |
Total operating expenses | | | 191,023 | | | 141,655 | | | 4,607 | | | 337,285 | |
Operating income | | | 472,596 | | | 13,442 | | | (4,607) | | | 481,431 | |
Other income (expense): | | | | | | | | | | | | | |
Interest expense, net | | | — | | | — | | | (157,306) | | | (157,306) | |
Equity in earnings of unconsolidated affiliates | | | 82,795 | | | — | | | — | | | 82,795 | |
Loss on early extinguishment of debt | | | — | | | — | | | (14,091) | | | (14,091) | |
Total other income (expense) | | | 82,795 | | | — | | | (171,397) | | | (88,602) | |
Income before income taxes | | | 555,391 | | | 13,442 | | | (176,004) | | | 392,829 | |
Income tax expense | | | — | | | — | | | (103,126) | | | (103,126) | |
Net income and comprehensive income | | $ | 555,391 | | | 13,442 | | | (279,130) | | | 289,703 | |
| (1) | Corporate expenses that are not directly attributable to either the gathering and processing or water handling segments. |
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| | Nine Months Ended September 30, 2025 | | ||||||||||
| | Gathering and | | Water | | | | Consolidated | | ||||
(in thousands) |
| Processing |
| Handling |
| Unallocated (1) |
| Total | | ||||
Revenues: | | | | | | | | | | | | | |
Revenue–Antero Resources | | $ | 736,745 | | | 206,177 | | | — | | | 942,922 | |
Revenue–third-party | | | — | | | 1,504 | | | — | | | 1,504 | |
Amortization of customer relationships | | | (27,814) | | | (25,190) | | | — | | | (53,004) | |
Total revenues | | | 708,931 | | | 182,491 | | | — | | | 891,422 | |
Operating expenses: | | | | | | | | | | | | | |
Direct operating | | | 80,932 | | | 96,898 | | | — | | | 177,830 | |
General and administrative (excluding equity-based compensation) | | | 16,040 | | | 11,096 | | | 4,494 | | | 31,630 | |
Equity-based compensation | | | 22,774 | | | 11,217 | | | 844 | | | 34,835 | |
Facility idling | | | — | | | 1,263 | | | — | | | 1,263 | |
Depreciation | | | 57,786 | | | 42,791 | | | — | | | 100,577 | |
Impairment of property and equipment | | | — | | | 984 | | | — | | | 984 | |
Other operating expense, net | | | — | | | 143 | | | — | | | 143 | |
Total operating expenses | | | 177,532 | | | 164,392 | | | 5,338 | | | 347,262 | |
Operating income | | | 531,399 | | | 18,099 | | | (5,338) | | | 544,160 | |
Other income (expense): | | | | | | | | | | | | | |
Interest expense, net | | | — | | | — | | | (143,568) | | | (143,568) | |
Equity in earnings of unconsolidated affiliates | | | 87,724 | | | — | | | — | | | 87,724 | |
Loss on early extinguishment of debt | | | — | | | — | | | (1,313) | | | (1,313) | |
Total other income (expense) | | | 87,724 | | | — | | | (144,881) | | | (57,157) | |
Income before income taxes | | | 619,123 | | | 18,099 | | | (150,219) | | | 487,003 | |
Income tax expense | | | — | | | — | | | (125,769) | | | (125,769) | |
Net income and comprehensive income | | $ | 619,123 | | | 18,099 | | | (275,988) | | | 361,234 | |
| (1) | Corporate expenses that are not directly attributable to either the gathering and processing or water handling segments. |
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The operating data for Antero Midstream is as follows:
| | | | | | | | Amount of | | | | | | |
| | Nine Months Ended September 30, | | Increase | | Percentage | | |||||||
|
| 2024 |
| 2025 |
| or Decrease |
| Change | | |||||
Operating Data: | | | | | | | | | | | | | | |
Gathering—low pressure (MMcf) | | | 898,386 | | | 931,843 | | | 33,457 | | | 4 | % | |
Compression (MMcf) | | | 892,853 | | | 928,153 | | | 35,300 | | | 4 | % | |
Gathering—high pressure (MMcf) | | | 822,558 | | | 864,362 | | | 41,804 | | | 5 | % | |
Fresh water delivery (MBbl) | | | 24,150 | | | 26,828 | | | 2,678 | | | 11 | % | |
Other fluid handling (MBbl) | | | 14,956 | | | 15,475 | | | 519 | | | 3 | % | |
Wells serviced by fresh water delivery | | | 45 | | | 56 | | | 11 | | | 24 | % | |
Gathering—low pressure (MMcf/d) | | | 3,279 | | | 3,413 | | | 134 | | | 4 | % | |
Compression (MMcf/d) | | | 3,259 | | | 3,400 | | | 141 | | | 4 | % | |
Gathering—high pressure (MMcf/d) | | | 3,002 | | | 3,166 | | | 164 | | | 5 | % | |
Fresh water delivery (MBbl/d) | | | 88 | | | 98 | | | 10 | | | 11 | % | |
Other fluid handling (MBbl/d) | | | 55 | | | 57 | | | 2 | | | 4 | % | |
Average Realized Fees(1): | | | | | | | | | | | | | | |
Average gathering—low pressure fee ($/Mcf) | | $ | 0.36 | | | 0.36 | | | — | | | * | | |
Average compression fee ($/Mcf) | | $ | 0.21 | | | 0.22 | | | 0.01 | | | 5 | % | |
Average gathering—high pressure fee ($/Mcf) | | $ | 0.22 | | | 0.23 | | | 0.01 | | | 5 | % | |
Average fresh water delivery fee ($/Bbl) | | $ | 4.30 | | | 4.37 | | | 0.07 | | | 2 | % | |
Joint Venture Operating Data: | | | | | | | | | | | | | | |
Processing—Joint Venture (MMcf) | | | 439,317 | | | 459,779 | | | 20,462 | | | 5 | % | |
Fractionation—Joint Venture (MBbl) | | | 10,960 | | | 10,920 | | | (40) | | | * | | |
Processing—Joint Venture (MMcf/d) | | | 1,603 | | | 1,684 | | | 81 | | | 5 | % | |
Fractionation—Joint Venture (MBbl/d) | | | 40 | | | 40 | | | — | | | * | | |
| * | Not meaningful or applicable. |
| (1) | The average realized fees for the nine months ended September 30, 2025 include annual CPI-based adjustments of approximately 1.6%. |
Revenues. Total revenues increased by 9%, from $819 million for the nine months ended September 30, 2024 to $891 million for the nine months ended September 30, 2025. Total revenues included amortization of customer relationships of $53 million for each of the nine months ended September 30, 2024 and 2025. Gathering and processing revenues increased by 7%, from $664 million for the nine months ended September 30, 2024 to $709 million for the nine months ended September 30, 2025. Water handling revenues increased by 18%, from $155 million for the nine months ended September 30, 2024 to $182 million for the nine months ended September 30, 2025. These fluctuations primarily resulted from the following:
Gathering and Processing
| ● | Low pressure gathering revenue increased $17 million period over period primarily due to increased throughput volumes of 33 Bcf, or 134 MMcf/d, and increased low pressure gathering rates as a result of annual CPI-based adjustments. Low pressure gathering volumes increased between periods primarily due to 65 additional wells being connected to our system since September 30, 2024, partially offset by natural production decline of the wells connected to our system between periods. |
| ● | Compression revenue increased $12 million period over period primarily due to increased throughput volumes of 35 Bcf, or 141 MMcf/d, two compressor stations acquired during the second quarter of 2024 and increased compression rates as a result of annual CPI-based adjustments. Compression volumes increased between periods primarily due to 65 additional wells being connected to our system September 30, 2024, partially offset by natural production decline of the wells connected to our system between periods. |
| ● | High pressure gathering revenue increased $16 million period over period primarily due to increased throughput volumes of 42 Bcf, or 164 MMcf/d, 48 miles of high pressure gathering lines acquired during the second quarter of 2024 and increased high pressure gathering rates as a result of annual CPI-based adjustments. The high pressure gathering volumes increased period over period primarily due to 65 additional wells being connected to our system since September 30, 2024, partially offset by natural production decline of the wells connected to our system between periods. |
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Water Handling
| ● | Fresh water delivery revenue increased $13 million period over period primarily due to increased fresh water delivery volumes of 3 MMBbl, or 10 MBbl/d, and an increase to the fresh water delivery rate as a result of an annual CPI-based adjustment. |
| ● | Other fluid handling services revenue increased $14 million period over period primarily due to higher wastewater trucking and disposal volumes and costs that are billed at cost plus 3%, as well as increased blending cost of service fees and volumes. |
Direct operating expenses. Direct operating expenses increased by 10%, from $162 million for the nine months ended September 30, 2024 to $178 million for the nine months ended September 30, 2025. Gathering and processing direct operating expenses increased by 5% from $77 million for the nine months ended September 30, 2024 to $81 million for the nine months ended September 30, 2025 primarily due to increased gathering and compression volumes, higher costs for the two compressor stations and 48 miles of high pressure gathering lines acquired during the second quarter of 2024 and increased heavy maintenance expense between periods. Water handling direct operating expenses increased by 14%, from $85 million for the nine months ended September 30, 2024 to $97 million for the nine months ended September 30, 2025 primarily due to higher wastewater trucking and disposal costs, increased blending costs and increased fresh water delivery volumes between periods.
General and administrative (excluding equity-based compensation) expenses. General and administrative expenses (excluding equity-based compensation expense) remained consistent at $32 million for each of the nine months ended September 30, 2024 and 2025, respectively.
Equity-based compensation expenses. Equity-based compensation expenses increased by 6%, from $33 million for the nine months ended September 30, 2024 to $35 million for the nine months ended September 30, 2025 primarily due to annual equity-based awards granted during the first quarters of 2024 and 2025. Our equity-based awards vest over three or four year service periods. See Note 9—Equity-Based Compensation to the unaudited condensed consolidated financial statements for additional information.
Depreciation expense. Depreciation expense decreased by 6%, from $107 million for the nine months ended September 30, 2024 to $101 million for the nine months ended September 30, 2025 primarily due to lower depreciation expense of $11 million related to our program to repurpose underutilized compressor units to expand existing or construct new compressor stations between periods, partially offset by depreciation expense of $4 million related to assets placed in service between periods and higher depreciation expense of $1 million for our assets acquired during the second quarter of 2024.
Interest expense. Interest expense decreased by 9%, from $157 million for the nine months ended September 30, 2024 to $144 million for the nine months ended September 30, 2025 primarily due to lower interest expense on our Senior Notes due to the repurchase and redemption of the remaining $550 million principal amount of the 2026 Notes during the nine months ended September 30, 2024, and lower interest rates on our Credit Facility during the nine months ended September 30, 2025, partially offset by higher average daily Credit Facility borrowings between periods. See Note 7—Long-Term Debt to our unaudited condensed consolidated financial statements for additional information.
Equity in earnings of unconsolidated affiliates. Equity in earnings of unconsolidated affiliates increased by 6%, from $83 million for the nine months ended September 30, 2024 to $88 million for the nine months ended September 30, 2025 primarily due to increased processing volumes and higher processing and fractionation fees as a result of annual CPI-based adjustments between periods.
Loss on early extinguishment of debt. Loss on early extinguishment of debt of $14 million for the nine months ended September 30, 2024 relates to the premium paid to repurchase or otherwise fully redeem all of our 2026 Notes at a weighted average premium of 101.975% of the principal amount thereof, plus accrued and unpaid interest, as well as the write-off of unamortized deferred financing costs. Loss on early extinguishment of debt of $1 million for the nine months ended September 30, 2025 primarily relates to the write-off of unamortized deferred financing costs and unamortized premium attributable to our 2027 Notes that were fully redeemed at par, plus accrued and unpaid interest. See Note 7—Long-Term Debt to the unaudited condensed consolidated financial statements for more information.
Income tax expense. Income tax expense increased by 22%, from $103 million for the nine months ended September 30, 2024 to $126 million for the nine months ended September 30, 2025, which reflects effective tax rates of 26.3% and 25.8%, respectively. This income tax increase was primarily due to higher income before income taxes between periods. The decrease in our effective tax rate between periods was primarily due to the effects of equity-based compensation expense.
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See Note 2—Summary of Significant Accounting Policies to the unaudited condensed consolidated financial statements for additional information on the effects of the OBBB.
Capital Resources and Liquidity
Sources and Uses of Cash
Capital resources and liquidity are provided by operating cash flows, available borrowings under our Credit Facility and capital market transactions. See Note 7—Long-Term Debt to the unaudited condensed consolidated financial statements. We expect that the combination of these capital resources will be adequate to meet our working capital requirements, capital expenditures program and expected quarterly cash dividends for at least the next 12 months.
Our Board declared a cash dividend on the shares of our common stock of $0.2250 per share for the quarter ended September 30, 2025. The dividend is payable on November 5, 2025 to stockholders of record as of October 22, 2025. Our Board also declared a cash dividend of $137,500 on the shares of Series A Preferred Stock that is payable on November 14, 2025 in accordance with their terms as discussed in Note 11—Equity and Net Income Per Common Share. As of September 30, 2025, there were dividends in the amount of $68,750 accumulated in arrears on our Series A Preferred Stock.
We expect our future cash requirements relating to working capital, capital expenditures, acquisitions and quarterly cash dividends to our stockholders will be funded from cash flows internally generated from our operations or borrowings under the Credit Facility.
As of September 30, 2025, we did not have any off-balance sheet arrangements.
Cash Flows
The following table summarizes our cash flows for the nine months ended September 30, 2024 and 2025:
| | Nine Months Ended September 30, | | ||||
(in thousands) |
| 2024 |
| 2025 | | ||
Net cash provided by operating activities | | $ | 611,303 | | | 676,961 | |
Net cash used in investing activities | | | (203,076) | | | (119,240) | |
Net cash used in financing activities | | | (408,293) | | | (557,721) | |
Net decrease in cash and cash equivalents | | $ | (66) | | | — | |
Operating activities. Net cash provided by operating activities was $611 million and $677 million for the nine months ended September 30, 2024 and 2025, respectively. This increase in cash flows provided by operating activities between periods was primarily due to higher gathering and processing and water handling revenues, partially offset by increased direct operating expenses and changes in working capital.
Investing activities. Net cash flows used in investing activities was $203 million and $119 million for the nine months ended September 30, 2024 and 2025, respectively. The decrease in cash flows used in investing activities between periods was primarily due to our acquisition of gathering and compression assets during the second quarter of 2024 of $70 million, before closing adjustments, and lower capital spending related to our gathering systems and facilities of $43 million, partially offset by higher capital spending on our water handling systems of $22 million and additional investment in Stonewall of $6 million between periods.
Financing activities. Net cash used in financing activities was $408 million and $558 million for the nine months ended September 30, 2024 and 2025, respectively. The increase in cash flows used in financing activities between periods was primarily due to share repurchases of $87 million during the nine months ended September 30, 2025, as well as lower net cash provided by our senior note refinancing of $39 million, higher net repayments on our Credit Facility of $15 million and higher employee tax withholdings for the settlement of equity-based compensation awards of $12 million between periods, partially offset by lower payments of deferred financing costs of $6 million between periods.
2025 Capital Investment
On February 12, 2025, we announced a capital budget with a range of $170 million to $200 million. On July 30, 2025, we announced a revised capital budget for 2025 of $170 million to $190 million. This revised capital budget supports Antero Resources’ maintenance capital program for 2025. Our capital budget may be adjusted as business conditions warrant.
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Additionally, we monitor our existing assets and look for opportunities to reuse or otherwise repurpose assets in an effort to optimize our capital efficiency.
Our capital expenditures were as follows:
| | Three Months Ended September 30, | | Nine Months Ended September 30, | | ||||||||
(in thousands) | | 2024 | | 2025 | | 2024 | | 2025 | | ||||
Gathering systems and facilities | | $ | 49,365 | | | 23,702 | | | 115,279 | | | 69,615 | |
Water handling systems | | | 6,007 | | | 26,059 | | | 21,141 | | | 57,203 | |
Investments in unconsolidated affiliates | | | 893 | | | 1,575 | | | 893 | | | 6,653 | |
Total capital expenditures | | $ | 56,265 | | | 51,336 | | | 137,313 | | | 133,471 | |
Debt Agreements
See Note 7—Long-Term Debt to the unaudited condensed consolidated financial statements and to “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our 2024 Form 10-K for additional information.
Critical Accounting Estimates
The discussion and analysis of our financial condition and results of operations are based upon our unaudited condensed consolidated financial statements, which have been prepared in accordance with GAAP. Any new accounting policies or updates to existing accounting policies as a result of recently adopted accounting standards have been included in Note 2—Summary of Significant Accounting Policies to our unaudited condensed consolidated financial statements. The preparation of our unaudited condensed consolidated financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent liabilities. Accounting estimates and assumptions are considered to be critical if there is reasonable likelihood that materially different amounts could have been reported under different conditions, or if different assumptions had been used. We evaluate our estimates and assumptions on a regular basis. We base our estimates on historical experience and various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the reported amounts in our unaudited condensed consolidated financial statements that are not readily apparent from other sources. Actual results may differ from these estimates and assumptions used in preparation of our unaudited condensed consolidated financial statements. See “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in the 2024 Form 10-K for additional information.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
The primary objective of the following information is to provide forward-looking quantitative and qualitative information about our potential exposure to market risk. The term “market risk” refers to the risk of loss arising from adverse changes in commodity prices and interest rates. The disclosures are not meant to be precise indicators of expected future losses, but rather indicators of reasonably possible losses. This forward-looking information provides indicators of how we view and manage our ongoing market risk exposures.
Commodity Price Risk
Our gathering and compression and water services agreements with Antero Resources provide for fixed-fee and cost of service fee structures, and we intend to continue to pursue additional fixed-fee or cost of service fee opportunities with Antero Resources and third parties in order to avoid direct commodity price exposure. However, to the extent that our future contractual arrangements with Antero Resources or third parties do not provide for fixed-fee or cost of service fee structures, we may become subject to commodity price risk. We are subject to commodity price risks to the extent that they impact Antero Resources’ development program and production and therefore our gathering, compression, and water handling volumes. We cannot predict to what extent our business would be impacted by lower commodity prices and any resulting impact on Antero Resources’ operations.
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Interest Rate Risk
Our primary exposure to interest rate risk results from outstanding borrowings under the Credit Facility, which has a floating interest rate. We do not currently, but may in the future, hedge the interest on portions of our borrowings under the Credit Facility from time-to-time in order to manage risks associated with floating interest rates. As of September 30, 2025, we had $380 million of borrowings and no letters of credit outstanding under the Credit Facility. A 1.0% increase in the Credit Facility interest rate would have resulted in an estimated $4 million increase in interest expense for the nine months ended September 30, 2025.
Credit Risk
We are dependent on Antero Resources as our primary customer, and we expect to derive substantially all of our revenues from Antero Resources for the foreseeable future. As a result, any event, whether in our area of operations or otherwise, that adversely affects Antero Resources’ production, drilling schedule, financial condition, leverage, market reputation, liquidity, results of operations or cash flows may adversely affect our revenues and operating results.
Further, we are subject to the risk of non-payment or non-performance by Antero Resources, including with respect to our gathering and compression and water handling services agreements. We cannot predict the extent to which Antero Resources’ business would be impacted if conditions in the energy industry were to deteriorate, nor can we estimate the impact such conditions would have on Antero Resources’ ability to execute its drilling and development program or to perform under our agreements. Any material non-payment or non-performance by Antero Resources could adversely affect our revenues and operating results and our ability to return capital to stockholders.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
As required by Rule 13a-15(b) under the Exchange Act, we have evaluated, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this Quarterly Report on Form 10-Q. Our disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed by us in reports that we file under the Exchange Act is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure and is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC. Based upon that evaluation, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were effective as of September 30, 2025 at a reasonable assurance level.
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the three months ended September 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II—OTHER INFORMATION
Item 1. Legal Proceedings.
Our operations are subject to a variety of risks and disputes normally incident to our business. As a result, we may, at any given time, be a defendant in various legal proceedings and litigation arising in the ordinary course of business.
We maintain insurance policies with insurers in amounts and with coverage and deductibles that we, with the advice of our insurance advisors and brokers, believe are reasonable and prudent. We cannot, however, assure you that this insurance will be adequate to protect us from all material expenses related to potential future claims for personal and property damage or that these levels of insurance will be available in the future at economical prices.
See Note 14—Contingencies to the unaudited condensed consolidated financial statements for additional information.
Item 1A. Risk Factors.
We are subject to certain risks and hazards due to the nature of the business activities we conduct. For a discussion of these risks, see “Item 1A. Risk Factors” in the 2024 Form 10-K. There have been no material changes to the risks described in such report. We may experience additional risks and uncertainties not currently known to us. Furthermore, as a result of developments occurring in the future, conditions that we currently deem to be immaterial may also materially and adversely affect us.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
Issuer Purchases of Equity Securities
The following table sets forth our common stock share purchase activity for each period presented:
| | | | | | | | | Approximate | | |
| | | | | | | | Dollar Value of | | ||
| | | | | | Total Number of | | Shares that May | | ||
| | Total Number | | Average Price | | Shares Purchased | | Yet be Purchased | | ||
| | of Shares | | Paid per | | as Part of Publicly | | Under the Plan (2) | | ||
Period | | Purchased (1) | | Share | | Announced Plans | | ($ in thousands) | | ||
July 1, 2025 – July 31, 2025 | | 635,121 | | $ | 17.46 | | 634,939 | | $ | 414,884 | |
August 1, 2025 – August 31, 2025 | | 684,890 | | | 17.68 | | 684,890 | | | 402,777 | |
September 1, 2025 – September 30, 2025 | | 995,890 | | | 18.21 | | 995,890 | | | 384,641 | |
Total | | 2,315,901 | | $ | 17.85 | | 2,315,719 | | | | |
| (1) | The total number of shares purchased includes shares of our common stock transferred to us in order to satisfy tax withholding obligations incurred upon the vesting of equity-based awards held by our employees. |
| (2) | In February 2024, the Board authorized a $500 million share repurchase program. |
Item 5. Other INFORMATION.
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Item 6. Exhibits
Exhibit Number | | Description of Exhibit |
3.1 | | |
3.2 | | |
3.3 | | |
3.4 | | |
3.5 | | |
3.6 | | |
4.1 | | |
4.2 | | |
10.1 | | |
10.2 | | |
10.3 | * | |
31.1 | * | |
31.2 | * | |
32.1 | * | |
32.2 | * | |
101 | * | The following financial information from this Quarterly Report on Form 10-Q of Antero Midstream Corporation for the quarter ended September 30, 2025, formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Condensed Consolidated Balance Sheets, (ii) Condensed Consolidated Statements of Operations and Comprehensive Income, (iii) Condensed Consolidated Statements of Stockholders’ Equity, (iv) Condensed Consolidated Statements of Cash Flows and (v) Notes to the Unaudited Condensed Consolidated Financial Statements, tagged as blocks of text. |
104 | | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
The exhibits marked with the asterisk symbol (*) are filed or furnished with this Quarterly Report on Form 10-Q.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| |
ANTERO MIDSTREAM CORPORATION | |
| |
By: | /s/ Justin J. Agnew |
| Justin J. Agnew |
| Chief Financial Officer, Vice President—Finance and Investor Relations |
| |
Date: | October 29, 2025 |
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Exhibit 10.3
ANTERO MIDSTREAM CORPORATION
SUMMARY OF COMPENSATION FOR NON-EMPLOYEE DIRECTORS
(Effective as of August 14, 2025)
Each member of the Board of Directors (the “Board”) of Antero Midstream Corporation (the “Company”) who is not an employee of the Company or Antero Resources Corporation and who does not otherwise waive in writing his or her compensation hereunder (each such individual a “Non-Employee Director”), shall receive the compensation described in this Summary of Compensation for Non-Employee Directors.
Annual Base Retainer:$107,500
Additional Annual Retainers:
Chairman:$32,500
Audit Committee:$15,000 ($27,500 for Chair)
Compensation Committee: $7,500 ($20,000 for Chair)
Nominating & Governance Committee: $7,500 ($15,000 for Chair)
Environmental, Social & Governance Committee: $7,500 ($15,000 for Chair)
Conflicts Committee: $7,500
Annual Stock-Based Compensation
(Excluding Chairman):$142,500
Annual Stock-Based Compensation
(Chairman):$260,000
Form of Payment of Annual Retainers:
| ● | All annual retainers are paid on a quarterly basis in arrears in substantially equal installments on the tenth day following the last day of each calendar quarter (or, if such tenth day does not fall on a day on which shares (“Shares”) of common stock, par value $0.01, of the Company are traded on the New York Stock Exchange (each, a “Trading Day”), on the last Trading Day preceding such tenth day). Each date determined in accordance with the preceding sentence is referred to herein as a “Payment Date.” So long as an individual serves as a Non-Employee Director or, if applicable, in one or more of the positions described above under “Additional Annual Retainers” on any date during the applicable calendar quarter, such Non-Employee Director shall receive the entire installment of the annual retainer(s) payable for such calendar quarter on the applicable Payment Date. |
| ● | All annual stock-based compensation shall be granted in arrears in four equal installments on each Payment Date in the form of fully vested and unrestricted Shares issued pursuant to the Antero Midstream Corporation Long Term Incentive Plan (as amended from time to time, including any successor plan, the “LTIP”). With respect to each calendar quarter, the number of Shares issued to each Non-Employee Director shall be determined by dividing (i) $35,625 (the “Quarterly Stock Value”) by (ii) the Fair Market Value (as defined in the LTIP) of a Share on the applicable Payment Date, rounded up or down to the nearest whole Share, as applicable. In the event a Non-Employee Director does not serve as a Non-Employee Director for an entire calendar quarter, such individual shall receive a prorated portion of the annual stock-based compensation otherwise payable to such individual for such calendar quarter, with such prorated portion determined by dividing (i) the product of (a) $35,625 and (b) a fraction, the numerator of which is the number of days during which the individual serves as a Non-Employee Director during the applicable calendar quarter and the denominator of which is the number of days in the applicable calendar quarter (the “Pro-rated Quarterly Stock Value”) by (ii) the Fair Market Value of a Share on the applicable Payment Date, rounded up or down to the nearest whole Share, as applicable. Each installment of a Non- |
| Employee Director’s annual stock-based compensation shall be evidenced by and subject to the terms of a form of stock award agreement most recently approved by the Compensation Committee (the “Compensation Committee”) of the Board. Notwithstanding the foregoing, if a Non-Employee Director is not providing services to the Company on the Payment Date, such Non-Employee Director shall not be granted Shares on the Payment Date and shall instead receive an additional cash payment on the Payment Date equal to the Quarterly Stock Value or the Pro-rated Quarterly Stock Value, as applicable. |
| ● | Subject to compliance with the Company’s insider trading policies and all applicable laws, Non-Employee Directors may elect to have the Company pay all or a portion of their annual retainer(s) for a calendar year in Shares in lieu of cash. If such an election is made, the number of Shares paid is determined by dividing the dollar amount of the annual retainer(s) elected to be paid in Shares by the Fair Market Value of a Share on the applicable Payment Date, rounded up or down to the nearest whole Share, as applicable. Shares issued as payment of annual retainer(s) are fully vested and unrestricted Shares issued pursuant to the LTIP and are paid on the same schedule as the annual retainer(s) for which they are issued. Any election by a Non-Employee Director to receive all or a portion of an annual retainer for a calendar year in Shares must be made on the form prescribed by the Compensation Committee and made no later than the expiration of the election period established by the Compensation Committee. A Non-Employee Director may not make such an election during a Company blackout period or when the Non-Employee Director is otherwise in possession of material non-public information. Any such election will be irrevocable with respect to the calendar year for which it is made, and the election will remain in effect for subsequent calendar years unless the Non-Employee Director revokes the election or makes a different election with respect to a subsequent calendar year. If a Non-Employee Director does not make such an election, then all of the Non-Employee Director’s annual retainer(s) will be paid in cash. Notwithstanding the foregoing, if a Non-Employee Director is not providing services to the Company on the Payment Date, such Non-Employee Director shall not be granted Shares on the Payment Date and shall instead receive an additional cash payment on the Payment Date equal to the value of the annual retainer the Non-Employee Director elected to receive in Shares for the preceding calendar quarter. |
| ● | If the grant of Shares deliverable on a Payment Date is prohibited by the terms of the Company’s Insider Trading Policy (as amended from time to time), applicable law or the rules of the securities exchange upon which the Shares are traded, then such Shares will instead be granted on the first business day that they can be granted in compliance with the terms of the applicable policy, law or rules. For the avoidance of doubt, the number of Shares delivered on such date will still be calculated based on the Fair Market Value of a Share on the originally scheduled Payment Date, rounded up or down to the nearest whole Share, as applicable. In addition, Shares will not be issued hereunder unless (i) a registration statement under the Securities Act of 1933, as amended from time to time (the “Securities Act”), is in effect at the time of such issuance with respect to the Shares to be issued and the issuance qualifies for registration thereunder or (ii) in the opinion of legal counsel to the Company, the Shares to be issued are permitted to be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act. |
Meeting Fees:
| ● | Non-employee directors receive meeting fees of $1,500 for each committee meeting attended in excess of ten meetings for such committee per calendar year up to a total maximum of $22,500 of committee meeting fees for each committee per calendar year. Any meeting fees earned during a quarter will be paid on the Payment Date immediately following the quarter in which they were earned. |
| ● | Additionally, each Non-Employee Director will be reimbursed for: (i) travel and miscellaneous expenses to attend meetings and activities of the Board or its committees and (ii) travel and miscellaneous expenses related to his or her participation in general education and orientation programs for directors. |
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Stock Ownership Requirements:
| ● | Non-employee directors are subject to the stock retention percentages and target ownership levels as set forth in the Antero Midstream Corporation Stock Ownership and Retention Guidelines, adopted as of March 12, 2019, and as amended from time to time. |
Indemnification/Liability Insurance:
| ● | The Company will enter into indemnification agreements with current and future Non-Employee Directors, which will provide for the indemnification of Non-Employee Directors to the fullest extent permitted under Delaware law against liabilities that may arise by reason of their service to the Company, and entitle the Non-Employee Directors to advances of expenses reasonably incurred as a result of any proceeding against them for which they are entitled to indemnification. |
| ● | The Company will purchase insurance on behalf of any Non-Employee Director for liability arising out of that person's actions as a Non-Employee Director regardless of whether Delaware law would permit indemnification. |
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Exhibit 31.1
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
PURSUANT TO RULE 13A-14(A) AND RULE 15D-14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED
I, Michael N. Kennedy, Chief Executive Officer and President of Antero Midstream Corporation, certify that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2025 of Antero Midstream Corporation (the “registrant”); |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and |
| b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and |
| c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: October 29, 2025 | | |
| | |
/s/ Michael N. Kennedy | | |
Michael N. Kennedy | | |
Chief Executive Officer and President | | |
Exhibit 31.2
CERTIFICATION OF CHIEF FINANCIAL OFFICER
PURSUANT TO RULE 13A-14(A) AND RULE 15D-14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED
I, Justin J. Agnew, Chief Financial Officer and Vice President—Finance and Investor Relations of Antero Midstream Corporation, certify that:
| 1. | I have reviewed this Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2025 of Antero Midstream Corporation (the “registrant”); |
| 2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
| 3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
| 4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
| a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and |
| b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and |
| c. | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
| d. | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting. |
| 5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
| a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
| b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: October 29, 2025 | | |
| | |
/s/ Justin J. Agnew | | |
Justin J. Agnew | | |
Chief Financial Officer, Vice President—Finance and Investor Relations | | |
Exhibit 32.1
CERTIFICATION OF
CHIEF EXECUTIVE OFFICER
OF ANTERO MIDSTREAM CORPORATION
PURSUANT TO 18 U.S.C. SECTION 1350
In connection with this Quarterly Report on Form 10-Q of Antero Midstream Corporation for the quarter ended September 30, 2025, I, Michael N. Kennedy, Chief Executive Officer and President of Antero Midstream Corporation, hereby certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
| 1. | This Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| 2. | The information contained in this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 fairly presents, in all material respects, the financial condition and results of operations of Antero Midstream Corporation for the periods presented therein. |
Date: October 29, 2025 | |
| |
/s/ Michael N. Kennedy | |
Michael N. Kennedy | |
Chief Executive Officer and President | |
Exhibit 32.2
CERTIFICATION OF
CHIEF FINANCIAL OFFICER
OF ANTERO MIDSTREAM CORPORATION
PURSUANT TO 18 U.S.C. SECTION 1350
In connection with this Quarterly Report on Form 10-Q of Antero Midstream Corporation for the quarter ended September 30, 2025, I, Justin J. Agnew, Chief Financial Officer and Vice President—Finance and Investor Relations of Antero Midstream Corporation, hereby certify pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:
| 1. | This Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
| 2. | The information contained in this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025 fairly presents, in all material respects, the financial condition and results of operations of Antero Midstream Corporation for the periods presented therein. |
Date: October 29, 2025 | | |
| | |
/s/ Justin J. Agnew | | |
Justin J. Agnew | | |
Chief Financial Officer, Vice President—Finance and Investor Relations | | |