HESM $40.53 +1.89%

HESM · Hess Midstream LP

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$40.53 +0.75 (+1.89%) At close · Aug 14

Market Cap

$5.20B

128.35M

All earnings calls

Earnings call · FY2025 Q4

Hess Midstream LP Q4 FY2025 Earnings Call

Concluded Feb 2, 2026 Audio replay

Feb 2, 2026 2:37 3 turns

Period: FY2025 Q4
Runtime: 2:37
Sources: 4 artifacts

8-K 10-K

Executive readout · one minute

What matters this quarter

Hess Midstream reported Q4 2025 net income of $168.0 million and Adjusted EBITDA of $309.1 million, with full-year 2025 Adjusted EBITDA of $1.238 billion (~9% growth from 2024), as the company completed its multiyear infrastructure buildout, setting up substantially lower capital spending and growing free cash flow through 2028.

Guidance and outlook through 2028 74 Free cash flow and shareholder returns 33 Volume and weather impact 24 Leverage and balance sheet 22 Adjusted EBITDA and margin performance 21 Chevron partnership and development plan 21

Management tone

Positive

Net tone +45 · moderate hedging

Grounding quotes

“we expect significant adjusted free cash flow generation in 2026 of $850 to $900 million, reflecting 12% growth over 2025 at the midpoint, followed by annualized growth of approximately 10% through 2028”
“approximately 95% of our revenues are covered by minimum volume commitments in 2026”
“we expect lower volumes across our systems as severe winter weather has continued through January and into February, together with normal contingencies for the rest of the winter period”

Forward guidance

8 guided metrics

Management's latest ranges and targets are included below.

Research coverage

4 live sources

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Revenue · derived Q4 $404.20M +2.1% YoY

Net income · derived Q4 $93.30M +32.5% YoY

Research materials

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8-K earnings release Filed Feb 2, 2026 10-K report Filed Feb 25, 2026 Company webcastOpen the original investor-relations page

Key takeaways

What improved, and what deserves a closer read.

↑ Constructive signals

Full-year 2025 Adjusted EBITDA of $1.238 billion, approximately 9% growth from 2024
2026 capital spending of approximately $150 million, a 40% reduction versus 2025, with spend declining further to less than $75 million per year in 2027 and 2028
2026 Adjusted Free Cash Flow guidance of $850–$900 million, ~12% growth over 2025 at the midpoint, with ~10% annualized growth through 2028
Approximately 95% of 2026 revenues protected by MVCs (90% in 2027, 80% in 2028)
Targeted 5% annual distribution per Class A share growth through 2028 plus excess free cash flow of ~$210 million for incremental shareholder returns and debt repayment
Q4 gross Adjusted EBITDA margin of ~83%, above the 75% target

↓ Risks & pressure points

Q4 throughput volumes declined 4% oil terminaling, 1% gas processing, and 5% water gathering year-over-year due to severe winter weather
Q1 2026 guidance of net income ~$150–$160 million and Adjusted EBITDA ~$295–$305 million, pressured by continued severe winter weather
Full-year 2026 net income guidance of $650–$700 million and Adjusted EBITDA of $1.225–$1.275 billion, approximately flat at the midpoint versus 2025
Q4 2025 net income of $168.0 million was down sequentially from $176 million in Q3 2025
Interest expense rose to $56.7 million in Q4 2025 from $52.2 million in the prior-year quarter due to higher revolver borrowings, with $338 million drawn on the revolving credit facility at year-end

Key moments

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“With the system now substantially built, our projected capital spending will be significantly lower. In 2026, we expect to spend approximately $150 million, a 40% reduction in capital spending relative to 2025. We expect our capital spend to decrease even further in 2027 and 2028 to less than $75 million per year.” Jonathan Stein, CEO

“We expect to generate adjusted free cash flow of between $850 million and $900 million and excess adjusted free cash flow of approximately $210 million after fully funding our targeted 5% annual distribution growth, which we expect to use for incremental shareholder returns and debt repayment.” Speaker 3, CFO

Guidance from the call

Stated verbally and extracted from the transcript.

Metric	Period	Guided	Basis
Capital expenditures 2026	2026	$150M	—
Adjusted free cash flow 2026	2026	$850M – $900M	Non-GAAP
Net income first quarter 2026	first quarter 2026	$150M – $160M	—
Adjusted EBITDA first quarter 2026	first quarter 2026	$295M – $305M	Non-GAAP
Net income full year 2026	full year 2026	$650M – $700M	—
Adjusted EBITDA full year 2026	full year 2026	$1.23B – $1.28B	Non-GAAP
Excess adjusted free cash flow 2026	2026	$210M	Non-GAAP
Gross adjusted EBITDA margin 2026	2026	75%	—

Quarter detail

How the reported period landed and where the business moved.

Capital returned

Dividend / share: $0.76

Listen and read together

Transcript

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2:37 Audio

Operator

Good day, ladies and gentlemen, and welcome to the fourth quarter 2025 Hess Midstream Conference Call. My name is Gigi, and I'll be your operator for today. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised that today's conference is being recorded for replay purposes. I would now like to turn the conference over to Jennifer Gordon, Vice President of Investor Relations. Please proceed.

Jennifer Gordon Head of Investor Relations

Thank you, Gigi. Good morning, everyone, and thank you for participating in our fourth quarter earnings conference call. Our earnings release was issued this morning and appears on our website, www.hessmidstream.com. Today's conference call contains projections and other forward-looking statements within the meaning of the federal securities laws. These statements are subject to known and unknown risks and uncertainties that may cause actual results to differ from those expressed or implied in such statements. These risks include those set forth in the risk factors section of HES Midstream's filings with the SEC. Also, on today's conference call, we may discuss certain GAAP financial measures. A reconciliation of the differences between these non-GAAP financial measures and the most directly comparable GAAP financial measures can be found in the earnings release. With me today are Jonathan Stein, Chief Executive Officer, and Mike Chadwick, Chief Financial Officer. I'll now turn the call over to Jonathan Stein.

Jonathan Stein CEO

Thanks, Jennifer. Welcome, everyone, to our fourth quarter 2025 earnings call. Today, I will review our 2025 performance, our 2026 and long-term guidance issued in December, and then I'll hand the call over to Mike to review our financials. In 2025, we continued our record of strong performance execution, completing our multi-year projects on time and on budget, and strategically growing our gas gathering and compression system. With the system now substantially built, our projected capital spending will be significantly lower. For 2026, we expect to spend approximately $100.

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