Western Midstream Operating, LP

(1)Average for period. Calculated as Adjusted Gross Margin for natural-gas assets, crude-oil and NGLs assets, or produced-water assets, divided by the respective total throughput (MMcf or MBbls) attributable to WES for natural-gas assets, crude-oil and NGLs assets, or produced-water assets.

Adjusted Gross Margin. Adjusted Gross Margin decreased by $4.2 million for the three months ended September 30, 2025, primarily due to (i) decreased product recoveries and average prices at the West Texas complex and (ii) decreased throughput at the Powder River Basin complex. These decreases were offset partially by increased throughput at the DJ Basin complex.

Adjusted Gross Margin increased by $106.4 million for the nine months ended September 30, 2025, primarily due to (i) increased throughput at the West Texas and Powder River Basin complexes, (ii) increased throughput and deficiency fees on certain contracts with increasing throughput minimums at the DBM oil system, and (iii) increased throughput at the DBM water systems, partially offset by a change in contract terms effective January 1, 2025. These increases were offset partially by (i) the sale of our interests in the Marcellus Interest systems, Saddlehorn, and Mont Belvieu JV during 2024, and (ii) decreased throughput at the Springfield gas-gathering system and Granger complex.

Per-Mcf Adjusted Gross Margin for natural-gas assets decreased by $0.05 for the three months ended September 30, 2025, primarily due to decreased product recoveries and average prices at the West Texas complex. This decrease was offset partially by higher throughput at the DJ Basin complex, which has a higher-than-average per-Mcf margin as compared to our other natural-gas assets.

Per-Bbl Adjusted Gross Margin for crude-oil and NGLs assets increased by $0.08 for the three months ended September 30, 2025, primarily due to increased deficiency fees on certain contracts with increasing throughput minimums at the DBM oil system.

Per-Bbl Adjusted gross margin for crude-oil and NGLs assets increased by $0.17 for the nine months ended September 30, 2025, primarily due to (i) increased throughput at the DBM oil system, which has a higher-than-average per-Bbl margin as compared to our other crude-oil and NGLs assets, (ii) lower throughput at TEP and FRP, which have a lower-than-average per-Bbl margin as compared to our other crude oil and NGLs assets, and (iii) the sale of our interest in Whitethorn LLC which had a lower-than-average per-Bbl margins as compared to our other crude oil and NGLs assets. These increases were offset partially by decreased revenues associated with demand volumes, partially offset by increased throughput and higher average fees resulting from cost-of-service rate redeterminations effective January 1, 2025, at the DJ Basin oil system.

Per-Bbl Adjusted Gross Margin for produced-water assets decreased by $0.02 for the nine months ended September 30, 2025, primarily due to a change in contract terms effective January 1, 2025.

Adjusted EBITDA. Adjusted EBITDA increased by $15.9 million for the three months ended September 30, 2025, primarily due to (i) a $12.2 million decrease in operation and maintenance expenses and (ii) a $10.2 million increase in total revenues and other. These amounts were offset partially by an $8.5 million increase in cost of product (net of lower of cost or market inventory adjustments).

Adjusted EBITDA increased by $91.9 million for the nine months ended September 30, 2025, primarily due to a $135.2 million increase in total revenues and other. This amount was offset partially by (i) a $15.4 million decrease in distributions from equity investments, (ii) a $14.2 million increase in operation and maintenance expenses, and (iii) a $7.4 million increase in property taxes.

Free Cash Flow. Free Cash Flow increased by $9.0 million for the three months ended September 30, 2025, primarily due to (i) an $8.9 million increase in distributions from equity investments in excess of cumulative earnings and (ii) a $6.2 million increase in net cash provided by operating activities. These amounts were offset partially by a $6.1 million increase in capital expenditures.

Free Cash Flow increased by $170.3 million for the nine months ended September 30, 2025, primarily due to (i) an $89.3 million decrease in capital expenditures and (ii) an $82.6 million increase in net cash provided by operating activities.

See Capital Expenditures and Historical Cash Flow within this Item 2 for further information.