Energy Transfer LP (NYSE:ET) reported financial results for the fourth quarter of 2025, delivering a mixed performance relative to Wall Street expectations. The midstream giant posted solid growth in a key profitability metric but fell short on the bottom line, a dynamic reflected in the stock's muted initial reaction.
Earnings Snapshot: A Miss on Profit
For the quarter ended December 31, 2025, Energy Transfer reported net income attributable to partners of $928 million, a decrease from $1.08 billion in the prior-year period. On a per-unit basis, this translated to earnings of $0.25.
The results presented a clear divergence from analyst forecasts:
- EPS Miss: The reported $0.25 per common unit fell short of the consensus estimate of $0.3793.
- Revenue Beat: Quarterly revenue of $25.32 billion surpassed the analyst estimate of $24.82 billion.
This pattern of higher revenue but lower-than-expected profit suggests pressures from costs or other income statement items, which included a $277 million impairment charge in the quarter.
Key Operational and Financial Highlights
Beyond the headline earnings figures, the press release emphasized robust operational growth and strategic capital allocation. The company's diversified asset base saw volume increases across nearly every segment compared to Q4 2024.
Operational Volume Growth:
- Crude oil transportation volumes rose 6%, setting a new partnership record.
- NGL and refined product terminal volumes increased by 12%.
- NGL exports grew by 12%.
- Interstate and intrastate natural gas transportation volumes were up 4% and 3%, respectively.
Management highlighted the strength of its fee-based, commodity-resistant business model, noting that approximately 40% of its Adjusted EBITDA comes from natural gas-related assets.
Strategic Capital Re-allocation: A significant strategic update was the decision to suspend development of the Lake Charles LNG export project. The partnership stated it would instead focus capital on its "significant backlog of natural gas pipeline infrastructure projects," which it believes offer superior risk/return profiles. This includes major expansions like the upsized Desert Southwest pipeline project and new agreements to supply natural gas to Oracle data centers in Texas.
Financial Health and Shareholder Returns
The partnership demonstrated continued financial discipline and commitment to returning capital to unitholders.
- Distribution Increase: Energy Transfer announced a quarterly cash distribution of $0.3350 per common unit for Q4 2025, an increase of more than 3% year-over-year.
- Strong Cash Flow: Adjusted EBITDA for the quarter grew 8% year-over-year to $4.18 billion. Distributable Cash Flow was $2.04 billion.
- Updated Guidance: The company raised its full-year 2026 Adjusted EBITDA guidance to a range of $17.45 to $17.85 billion, up from a prior range of $17.3 to $17.7 billion, attributing the increase to an acquisition by its USA Compression Partners subsidiary.
Market Reaction and Forward Look
In pre-market trading following the report, ET units were down approximately 1.7%, indicating investor disappointment primarily with the earnings per unit miss. This near-term reaction contrasts with the stock's positive performance over the past month, which saw a gain of over 7%.
Looking ahead, analyst estimates for the coming periods provide a benchmark. For the first quarter of 2026, the consensus is for revenue of $25.03 billion and earnings per share of $0.383. For the full 2026 year, analysts are projecting sales of $95.70 billion and revenue of $1.60 billion. Energy Transfer's own capital expenditure forecast of $5.0 to $5.5 billion for 2026, focused on natural gas network enhancements, aligns with its stated strategic pivot away from LNG development and toward pipeline investments.
For a detailed breakdown of past and future earnings estimates for Energy Transfer LP, you can review the data here.
Disclaimer: This article is for informational purposes only and does not constitute investment advice, financial analysis, or a recommendation to buy or sell any security. Investors should conduct their own research and consult with a qualified financial advisor before making any investment decisions.
