Cheniere Energy, Inc.

Results of Operations

Consolidated results of operations

Volumes loaded and recognized from the Liquefaction Projects

Components of LNG revenues and corresponding LNG volumes delivered

(1)Long-term agreements include agreements with an initial tenor of 12 months or more.

(2)Includes volumes sold under short-term agreements and IPM agreements.

Net income attributable to Cheniere

Net income attributable to Cheniere declined $149 million for the three months ended March 31, 2025 as compared to the same period of 2024. Although approximately 90% of our LNG volumes recognized in the comparable three month periods were sold in relation to long-term SPAs or IPM agreements, there was a decline in net income attributable to Cheniere in the current year as compared to the same period of 2024 primarily due to a $277 million unfavorable change in fair value of agreements accounted for as derivative instruments (before tax and the impact of non-controlling interests between the comparable three month periods), substantially all of which related to our commodity derivatives, where certain factors, including geopolitical and trade uncertainties, weather, transportation and storage, generally resulted in widening market-based locational price differentials for U.S. natural gas deliveries and persistent global LNG and natural gas index price volatility. Also contributing to the decline in net income attributable to Cheniere was a $70 million decrease in sublease income from our LNG vessels due to fewer days the LNG vessels were subleased and at lower rates in the current year as compared to the same period of 2024. The unfavorable variances were partially offset by a $214 million increase in revenues, net of cost of sales and excluding derivatives, as a result of higher margins generated by our integrated marketing function, as described below under the caption Revenues.

The following is an additional discussion of the significant drivers of the variance in net income attributable to Cheniere by line item:

Revenues

The $1.2 billion increase in revenues between the three months ended March 31, 2025 compared to the same period of 2024 was primarily attributable to:

•$725 million increase in revenues attributable to increased Henry Hub pricing, to which the majority of our long-term LNG sales contracts are indexed; and

•$428 million increase in revenues generated by our integrated marketing function under short-term agreements due to an increase in volumes sold at higher prices due to increased international LNG and natural gas prices.

Operating costs and expenses

The $1.4 billion unfavorable variance between the three months ended March 31, 2025 compared to the same period of 2024 was primarily attributable to:

•$967 million increase in cost of sales excluding the effect of derivative changes, primarily as a result of a $932 million increase in cost of natural gas feedstock largely due to the increase in U.S. natural gas prices; and

•$439 million of unfavorable changes in fair value of agreements accounted for as derivative instruments included in cost of sales, with the primary drivers of the variance described above under the caption Net income attributable to Cheniere.

Other income (expense)

The $34 million favorable variance between the three months ended March 31, 2025 as compared to the same period of 2024 was primarily attributable to:

•$37 million decrease in interest expense, net of capitalized interest, between the comparable three month periods primarily due to a $21 million increase in interest costs qualifying for capitalization, given the higher carrying value of assets under construction, and additionally due to lower gross interest cost due to debt reduction activities associated with our long-term capital allocation plan; and

•$21 million increase in other income (expense), net, primarily from a $26 million gain recognized on the sale of our equity interests in an equity method investment during the three months ended March 31, 2025.

These favorable variances were partially offset by:

•$24 million decrease in interest and dividend income as a result of decreased interest rates and lower average cash and cash equivalents balances between the periods.

Income tax provision

The $12 million unfavorable variance between the three months ended March 31, 2025 as compared to the same period of 2024 was primarily attributable to an increase in our effective tax rate, as described below, partially offset by lower tax expense due to a $159 million decrease in pre-tax income.

Our effective tax rate was 15.3% and 11.5% for the three months ended March 31, 2025 and 2024, respectively. Our effective tax rate increased between the comparable periods primarily due to a decrease in the ratio of our pre-tax income attributable to CQP, which is partially not taxable to us, as well as the tax impact from recording a valuation allowance on a capital loss carryover generated on the sale of our equity interests in an equity method investment during the three months ended March 31, 2025 as discussed above under the caption Other income (expense). The effective tax rate for the comparable three month periods was lower than the statutory rate of 21.0% primarily due to CQP’s income that is partially not taxable to us.

Net income attributable to non-controlling interests

The $22 million decrease between the three months ended March 31, 2025 as compared to the same period of 2024 was primarily attributable to a $41 million decrease in CQP’s consolidated net income, primarily due to an $84 million unfavorable change in fair value of agreements accounted for as derivative instruments between the comparable three month periods, partially offset by a $32 million increase in LNG revenues, net of cost of sales and excluding derivatives, and a $12 million decrease in interest expense, net of capitalized interest.

Significant factors affecting our results of operations

Below are significant factors that affect our results of operations.

Gains and losses on derivative instruments

Derivative instruments, which we use to manage certain risks, are reported at fair value in our Consolidated Financial Statements. For commodity derivative instruments, including those related to our IPM agreements, the underlying LNG sales being economically hedged are accounted for under the accrual method of accounting, whereby revenues expected to be derived from the future LNG sales are recognized only upon delivery or realization of the underlying transaction. Notwithstanding the operational intent to mitigate risk exposure over time, the recognition of derivative instruments at fair value has the effect of recognizing gains or losses relating to future period exposure, and given the significant volumes, long-term duration and volatility in price basis for certain of our derivative contracts, the use of derivative instruments may result in continued volatility of our results of operations based on changes in market pricing, counterparty credit risk and other relevant factors that may be outside of our control. For example, as described in Note 5—Derivative Instruments of our Notes to Consolidated Financial Statements, the fair value of the Liquefaction Supply Derivatives incorporates, as applicable, market participant-based assumptions pertaining to certain contractual uncertainties, including those related to the availability of market information for delivery points, which may require future development of infrastructure, as well as the timing of satisfaction of certain events or development of infrastructure to support natural gas gathering and transport. We may recognize changes in fair value through earnings that could significantly impact our results of operations if and when such uncertainties are resolved.

Commissioning volumes

Prior to substantial completion of a Train, amounts received from the sale of commissioning volumes from that Train are offset against LNG terminal construction-in-process, because these amounts are earned or loaded during the testing phase for the construction of that Train and are necessary activities to bring the asset to the condition for its intended use. During the three months ended March 31, 2025, we realized offsets to LNG terminal costs of $48 million corresponding to 5 TBtu of LNG that were related to the sale of commissioning volumes. We did not record any offsets to LNG terminal costs during the three months ended March 31, 2024.

Additional liquefaction capacities

The Corpus Christi Stage 3 Project is currently under construction and is expected to add over 10 mtpa of operational liquefaction capacity once all seven Trains reach substantial completion. Substantial completion was achieved for the first Train of the Corpus Christi Stage 3 Project in March 2025. The increased LNG volumes produced by these Trains are expected to result in higher revenues and cost of sales. However, prior to the commencement of long-term SPAs associated with these volumes, the additional volumes will be sold by our integrated marketing function at prevailing market prices.