Earnings Call Insights: Energy Transfer LP (ET) Q3 2025
Management View
- Thomas Long, Co-CEO & Director, highlighted that adjusted EBITDA for Q3 2025 was $3.84 billion, noting, “We saw several volume records during the quarter, including midstream gathering, NGL transportation, NGL and refined products terminal volumes and NGL export volumes.” He added that year-to-date adjusted EBITDA reached $11.8 billion and stated, “Year-to-date, we generated adjusted EBITDA of $11.8 billion compared to $11.6 billion for the same period in 2024. DCF attributable to the partners of Energy Transfer, as adjusted, was approximately $1.9 billion.” Long also detailed $3.1 billion spent on organic growth capital for the first nine months of 2025, primarily in the NGL and refined products, midstream and intrastate segments.
- Long announced, “We now expect to spend approximately $4.6 billion on organic growth capital projects in 2025 compared to our previous guidance of $5 billion. This is a result of project forecast reductions as well as spending deferrals into 2026.”
- Strategic highlights included a fully contracted 1.5 Bcf per day Desert Southwest pipeline, Phase 1 of the Hugh Brinson Pipeline expected in service by Q4 2026, and significant new long-term agreements with hyperscalers and data centers, including Oracle and Fermi America.
- Long noted, “Within the last year, we have contracted over 6 Bcf per day of pipeline capacity with demand-pull customers. These contracts have a weighted average life of over 18 years and are expected to generate more than $25 billion of revenue from firm transportation fees.”
- Long also emphasized, “We are leveraging our strong relationships to develop new projects, backed by high-quality counterparties on both the supply and demand side, and we see growth opportunities across all aspects of our business.”
- Dylan Bramhall, Group CFO, stated, “For the guidance, we have not included Parkland in there. So we’re saying without Parkland, we expect to be slightly below the initial guide.”
- Marshall McCrea, Co-CEO, commented, “The unique nature of these data centers, especially the hyperscalers are very confidential. So unlike a lot of our business, we can’t really talk about it. I can’t really get out there and get out in front of it. We were pleased to have the ability to disclose what we disclosed for this earnings call, believe me.”
Outlook
- Management expects to spend approximately $4.6 billion on organic growth capital projects in 2025. Long stated, “We now expect to spend approximately $4.6 billion on organic growth capital projects in 2025 compared to our previous guidance of $5 billion.”
- Guidance for 2025 is now expected to be slightly below the lower end of the $16.1 billion to $16.5 billion range. Bramhall clarified, “For the guidance, we have not included Parkland in there. So we’re saying without Parkland, we expect to be slightly below the initial guide.”
- Growth capital for 2026 is projected at approximately $5 billion, with the majority targeted toward natural gas segments.
Financial Results
- Adjusted EBITDA for Q3 2025 was $3.84 billion, compared to $3.96 billion in Q3 2024.
- Year-to-date adjusted EBITDA reached $11.8 billion, up from $11.6 billion in the same period in 2024.
- DCF attributable to partners was approximately $1.9 billion for the quarter.
- NGL and refined products adjusted EBITDA was $1.1 billion, up from $1 billion in Q3 2024, while midstream adjusted EBITDA was $751 million (vs. $816 million in Q3 2024, which included a $70 million one-time item).
- Crude oil segment delivered $746 million in adjusted EBITDA, down from $768 million in Q3 2024.
- Interstate natural gas adjusted EBITDA was $431 million, versus $460 million in Q3 2024, with a $43 million increase from a resolved tax obligation.
- Intrastate natural gas adjusted EBITDA was $230 million, compared to $329 million in Q3 2024.
Q&A
- Keith Stanley, Wolfe Research: Asked if Parkland acquisition was included in guidance. Bramhall responded, “For the guidance, we have not included Parkland in there. So we’re saying without Parkland, we expect to be slightly below the initial guide.”
- Elias Jossen, JPMorgan: Inquired about financial impact of recent data center deals. McCrea explained confidentiality but highlighted, “We have so many of these we’re chasing. A lot of them are high probability to get there.”
- Theresa Chen, Barclays: Asked about potential NGL pipe conversion to natural gas service and project economics. McCrea detailed historical asset conversions, current negotiations, and revenue opportunities, stating, “Some of the scenarios show twice the revenue with natural gas as what we might see with NGL.”
- Spiro Dounis, Citi: Asked about growth backlog and future CapEx run rate. Long said, “We have put out the $5 billion for next year. Obviously, as we get into early next year and year-end, we’ll keep that number updated for you.”
- Jean Ann Salisbury, BofA Securities: Queried on entering power generation. McCrea replied, “We like good rates of return on our projects, and we just — unless we’ve missed the boat on that, the opportunities that we’ve seen are low double, if not high single digit, it just doesn’t fit.”
- Michael Blum, Wells Fargo: Asked about capital outlay and returns for data center projects. McCrea provided high-level commentary, noting capital requirements vary widely.
- Zackery Van Everen, TPH: Sought details on Hugh Brinson pipeline contracts. McCrea explained a combination of supply push and demand pull, with future growth driven by demand pull.
- John Mackay, Goldman Sachs: Inquired about incremental growth from new pipeline deals. Bramhall confirmed, “That’s all incremental business that we’ve signed up that we’re not currently doing today.”
- Manav Gupta, UBS: Asked about regulatory changes and Price River Terminal expansion. McCrea described potential benefits from expedited regulation and terminal expansion demand.
Sentiment Analysis
- Analysts pressed for clarity on guidance, financial impacts of new data center contracts, capital efficiency, and backlog quantification, with a generally inquisitive yet neutral tone, as seen in Stanley’s and Jossen’s questions.
- Management maintained a confident and optimistic stance, especially on growth opportunities and project pipeline, repeatedly describing future prospects as “exciting” and emphasizing capital discipline and strategic asset positioning.
- Compared to the previous quarter, analyst tone remained steady, focusing on project specifics and strategic returns, while management continued to project confidence and enthusiasm around growth and contract wins.
Quarter-over-Quarter Comparison
- Organic growth capital guidance reduced to $4.6 billion from $5 billion due to project forecast reductions and deferrals.
- Guidance expectation shifted from “at or slightly below the lower end” of $16.1-$16.5 billion to “slightly below the lower end.”
- Expanded disclosure on data center contracts, including Oracle and Fermi America, and more detail on long-term pipeline commitments.
- Continued strong focus on large-scale pipeline and processing projects, with increased commentary on potential NGL-to-natural gas pipeline conversions.
- Management tone remained highly positive, with more detailed discussion on capital allocation, project returns, and customer demand.
Risks and Concerns
- Management highlighted continued competition and rate pressure in the NGL segment, leading to consideration of asset conversion for higher returns.
- Guidance was revised downward, with expectations now slightly below the lower end of the initial range.
- Certain growth project timelines and FID decisions, especially for Lake Charles LNG, remain contingent on contract finalizations and equity partner commitments.
- Analysts raised questions about capital efficiency, regulatory changes, and the ability to capitalize on new demand from data centers and power generation.
Final Takeaway
Energy Transfer’s third quarter call emphasized disciplined capital allocation and a robust pipeline of long-term, high-return projects, many of which are now fully contracted with investment-grade counterparties. Management projects $4.6 billion in organic growth capital for 2025 and expects continued growth in natural gas demand, driven by multi-decade agreements with data centers and utilities. While guidance was revised to slightly below the previous range, the company reported volume records and detailed significant progress on major expansions and strategic partnerships, reinforcing its position as a premier provider in the evolving U.S. energy infrastructure landscape.