Marathon Petroleum Q1 Loss Narrower Than Expected, Revenues Beat

Independent oil refiner and marketer Marathon Petroleum Corporation MPC reported a first-quarter 2025 adjusted loss per share of 24 cents, narrower than the Zacks Consensus Estimate of a loss of 63 cents. This primarily reflects the stronger-than-expected performance of its Refining & Marketing segment. The adjusted EBITDA of the segment totaled $489 million, surpassing the consensus mark of $286 million on the back of lower costs and higher throughput.

However, the company’s bottom line fell sharply from the year-ago adjusted profit of $2.78 per share, primarily due to the execution of the second-largest planned maintenance program in the company's history and a drop in the refining margin from the prior-year level.

Marathon Petroleum reported revenues of $31.9 billion, which beat the Zacks Consensus Estimate of $30.1 but fell 4.1% year over year.

Marathon Petroleum Corporation Price, Consensus and EPS Surprise

Marathon Petroleum Corporation price-consensus-eps-surprise-chart | Marathon Petroleum Corporation Quote

(Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.)

Inside MPC’s Segments

Refining & Marketing: The Refining & Marketing segment reported adjusted EBITDA of $489 million, which plunged approximately 74% from the year-ago profit of $1.9 billion. The drop primarily reflects lower year-over-year margins, partly offset by stronger throughput and lower costs.

Specifically, the refining margin of $13.38 per barrel declined from $19.35 a year ago. Capacity utilization during the quarter was 89% compared to 82% in the corresponding period of 2024.

Meanwhile, total refined product sales volumes were 3,446 thousand barrels per day (mbpd), up from 3,242 mbpd in the year-ago quarter. Throughput rose from 2,656 mbpd in the year-ago quarter to 2,849 mbpd and outperformed the Zacks Consensus Estimate of 2,766 mbpd.

MPC’s operating costs in the Refining & Marketing Segment decreased from $6.06 per barrel in the year-ago quarter to $5.74.

Midstream: This unit mainly reflects Marathon Petroleum’s general partner and majority limited partner interests in MPLX LP MPLX — a publicly traded master limited partnership that owns, operates, develops and acquires pipelines and other midstream assets.

Segment adjusted EBITDA was $1.7 billion, up 8.2% from the first quarter of 2024. Earnings were buoyed up by higher rates, stronger throughput and high volumes processed.

MPC’s Financial Analysis

Marathon Petroleum reported expenses of $31.2 billion in first-quarter 2025, down from $31.4 billion reported in the year-ago quarter.

In the reported quarter, Marathon Petroleum spent $776 million on capital programs (46.6% on Refining & Marketing and 49.7% on the Midstream segment) compared to $636 million in the year-ago period.

As of March 31, 2025, the Zacks Rank #3 (Hold) company had cash and cash equivalents of $3.8 billion and total debt, including that of MPLX, of $30.9 billion, with a debt-to-capitalization of 57.3%.

In the first quarter, MPC repurchased $1.1 billion of shares. It currently has a remaining authorization of $6.7 billion.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Important Refining & Marketing Earnings So Far

While we have discussed Marathon Petroleum’s first-quarter results in detail, let’s take a look at some other key downstream reports of this season.

Valero Energy Corporation VLO reported first-quarter 2025 adjusted loss of $1.90 per share, in contrast to the Zacks Consensus Estimate of earnings of 43 cents. The company reported earnings of $3.82 in the year-ago quarter. Total quarterly revenues decreased from $31,759 million in the prior-year quarter to $30,258 million. The top line, however, beat the Zacks Consensus Estimate of $28,450 million. The weak quarterly earnings can primarily be attributed to its West Coast asset impairment, heavy maintenance activity across refining systems and a steep drop in refining margins, which together weighed on profitability.

The company had cash and cash equivalents of $4.6 billion at the end of the first quarter. As of March 31, 2025, it had a total debt of $8.5 billion and finance lease obligations of $2.3 billion.

Phillips 66 PSX reported first-quarter 2025 adjusted loss of 90 cents per share, wider than the Zacks Consensus Estimate of a loss of 77 cents. The bottom line declined from the year-ago quarter’s earnings of $1.90. Total quarterly revenues of $32 billion beat the Zacks Consensus Estimate of $31 billion. However, the top line declined from the year-ago level of $36 billion.

Weak quarterly earnings can be attributed to lower refining volumes and a drop in realized refining margins worldwide. However, higher contribution from the Midstream segment due to increased NGL transportation volumes partially offsets the negatives.

As of March 31, 2025, cash and cash equivalents were $1.5 billion. Total debt was $18.8 billion, reflecting a debt-to-capitalization of 40%.

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

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