Kinetik Holdings Inc - Class A
Q1 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: +6.73%.
Did KNTK Beat Earnings? Q1 2025 Results
Kinetik Holdings posted a quietly encouraging first quarter for 2025, with revenue of $443.26 million and earnings per share of $0.05 as the midstream operator navigated winter weather disruptions and a volatile macro backdrop that CEO Jamie Welch acknowledged had tested the business. The quarter's standout metric was a 7% year-over-year increase in Adjusted EBITDA to $250.02 million, driven by a 17% surge in gas processed volumes to 1.80 Bcf/d, with the return to production at Alpine High providing meaningful sequential lift. GAAP net income fell to $19.26 million from $35.41 million a year ago, pressured by rising depreciation, amortization, and interest costs tied to the company's expanding infrastructure footprint. Looking ahead, Kinetik affirmed its full-year 2025 Adjusted EBITDA guidance of $1.09 billion to $1.15 billion, framing the year as a tale of two halves, with volumes expected to ramp materially once the Kings Landing Complex in New Mexico begins operations in early Q3, though softer commodity prices could trim full-year Adjusted EBITDA by approximately $20 million if sustained.
- 17% year-over-year growth in gas processed volumes to 1.80 Bcf/d
- Margin expansion in the Midstream Logistics segment
- Return to production at Alpine High driving sequential volume growth
- Fee-based and take-or-pay contract structures providing revenue visibility
“The start to 2025 has been marked with early successes, macroeconomic uncertainty, and the prospect of exciting potential opportunities. Despite winter weather and the recent, elevated volatility, Kinetik is pleased to report another solid quarter that slightly exceeded our internal estimates. Adjusted EBITDA of $250 million represents a 7% increase year-over-year driven by growth in processed gas volumes and margin expansion in the Midstream Logistics segment. Processed gas volumes were up sequentially, largely driven by the return to production at Alpine High.”
Kinetik CEO, on the earnings call
Forward Guidance & Outlook
Kinetik affirmed its 2025 Adjusted EBITDA guidance range of $1.09 billion to $1.15 billion and capital guidance range of $450 million to $540 million. Management expects a 'tale of two halves' for 2025 earnings, with annualized first-half Adjusted EBITDA of approximately $1 billion, ramping to annualized Q4 2025 Adjusted EBITDA of approximately $1.2 billion following the commissioning of Kings Landing. Current commodity futures pricing, if sustained, could negatively impact full-year Adjusted EBITDA by approximately $20 million. Several well pads expected in Q4 2025 have been pushed to 2026 due to lower crude oil prices. The company has less than $50 million of committed growth capital in 2026 and beyond, providing significant capital allocation flexibility. Management is cautiously proceeding with new large-scale infrastructure projects such as a Kings Landing expansion and a behind-the-meter power generation opportunity.
KNTK YoY Financials
KNTK Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.