Enterprise Q2 Earnings Beat Estimates, Revenues Decrease Y/Y

Enterprise Products Partners LP’s EPD second-quarter 2025 adjusted earnings per limited partner unit of 66 cents beat the Zacks Consensus Estimate of 65 cents. The bottom line also increased from the year-ago level of 64 cents.

However, total quarterly revenues of $11.4 billion missed the Zacks Consensus Estimate of $14.2 billion. The top line declined from $13.5 billion in the prior-year quarter.          

The strong quarterly earnings can be primarily attributed to record natural gas processing and pipeline volumes.

Enterprise Products Partners L.P. Price, Consensus and EPS Surprise

Enterprise Products Partners L.P. price-consensus-eps-surprise-chart | Enterprise Products Partners L.P. Quote

Segmental Performance

Pipeline volumes in NGL, crude oil, refined products and petrochemicals totaled 8.2 million barrels per day (bpd), higher than the year-ago quarter’s 7.8 million bpd. Natural gas pipeline volumes amounted to 20.4 trillion British thermal units per day (TBtus/d), higher than 18.7 TBtus/d recorded in the year-ago quarter. Also, marine terminal volumes totaled 2.1 million bpd, lower than 2.2 million bpd in the year-ago period.

The gross operating margin at NGL Pipelines & Services remained unchanged at $1.3 billion. This can be primarily attributed to higher processing volumes at its natural gas processing plant despite small MTM hedging losses.

Natural Gas Pipelines and Services’ gross operating margin decreased to $341 million from $386 million in the year-ago quarter. The downside was primarily due to MTM hedging losses and lower margins in Permian and Rockies facilities.

Crude Oil Pipelines & Services recorded a gross operating margin of $403 million, down from $417 million in the prior-year quarter. The decrease can be attributed to lower sales volumes and margins. Crude oil marine terminal volumes experienced a sharp decline, while pipeline volumes increased slightly.

The gross operating margin at Petrochemical & Refined Products Services was $354 million, down from $392 million in the second quarter of 2024. The segment was affected by lower margins in octane enhancement.

Cash Flow

The distributable cash flow totaled $1.9 billion compared with $1.8 billion in the year-ago period, providing a coverage of 1.6X. Enterprise retained $748 million of distributable cash flow in the second quarter. It generated an adjusted free cash flow of $2.1 billion, flat year over year.

Financials                                              

In the reported quarter, Enterprise’s total capital investment was $1.3 billion.

As of June 30, 2025, the outstanding total debt principal was $33.1 billion, and consolidated liquidity amounted to approximately $5.1 billion.

Outlook

For 2025, EPD expects growth capital expenditures to remain unchanged in the range of $4.0-$4.5 billion.

The company expects sustaining capital expenditure to be approximately $525 million in 2025.

EPD’s Zacks Rank and Key Picks

Currently, EPD carries a Zacks Rank #4 (Sell).

Investors interested in the energy sector may look at some better-ranked stocks like Antero Midstream Corporation AM, Eni S.p.A. E and Enbridge Inc. ENB, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Antero Midstream generates stable cash flow by providing midstream services under long-term contracts with Antero Resources. The company prioritizes debt reduction by effectively utilizing free cash flow after dividends. Antero Midstream’s higher dividend yield compared to its sub-industry peers reflects its commitment to generating shareholder returns.

AM’s earnings beat estimates in one of the trailing four quarters, met once and missed in the other two, delivering an average negative surprise of 5.50%.

Eni’s strategic growth in upstream production, focused portfolio optimization and expansion into renewables highlight its resilience amid changing macroeconomic conditions. Successful ramp-up of exploration projects and efficient asset management reinforce its long-term potential and enhance its position in the global energy market.

E’s earnings missed estimates in three of the trailing four quarters and beat once, delivering an average negative surprise of 11.43%.

Enbridge is a major energy company that owns the longest and most complex oil and gas pipeline system in North America, transporting about 20% of the natural gas used in the United States. The business earns steady fees through long-term contracts, protecting it against big oil price swings or changes in shipment. 

ENB’s earnings beat estimates in two of the trailing four quarters, met once and missed in the other, delivering an average surprise of 0.28%.

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This article originally published on Zacks Investment Research (zacks.com).

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