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 increased by $83.9 million for the three months ended June 30, 2026, primarily due to (i) increased throughput and disposal-fee revenue at the DBM water systems, (ii) the acquisition of the Comanche complex, (iii) increased throughput, average prices, and volumes sold at the DJ Basin complex, and (iv) increased average prices and volumes sold at the Powder River Basin and Chipeta complexes.

Adjusted Gross Margin increased by $325.3 million for the six months ended June 30, 2026, primarily due to (i) increased throughput at the DBM water systems, including the acquisition of Aris, increased skim-oil volumes sold, and averages prices, (ii) increased throughput, volumes sold, and average prices at the DJ Basin complex, (iii) increased throughput and deficiency fees on certain contracts with increasing throughput minimums at the DBM oil system, and (iv) the acquisition of the Comanche complex.

Per-Mcf Adjusted Gross Margin for natural-gas assets increased by $0.03 for the three months ended June 30, 2026, primarily due to (i) the acquisition of the Comanche complex, which has a higher-than-average per-Mcf margin as compared to our other natural-gas assets, (ii) increased throughput at the DJ Basin complex, which has a higher-than-average per-Mcf margin as compared to our other natural-gas assets, and increased average prices and volumes sold, and (iii) increased average prices and volumes sold at the Powder River Basin and Chipeta complexes.

Per-Bbl Adjusted Gross Margin for crude-oil and NGLs assets increased by $0.14 for the three months ended June 30, 2026, primarily due to increased deficiency fees on certain contracts with increasing throughput minimums at the DBM oil system, partially offset by lower distributions at FRP and TEP.

Per-Bbl Adjusted Gross Margin for crude-oil and NGLs assets increased by $0.05 for the six months ended June 30, 2026, primarily due to 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, and increased deficiency fees on certain contracts with increasing throughput minimums. This increase was offset partially by lower distributions at FRP and TEP.

Per-Bbl Adjusted Gross Margin for produced-water assets increased by $0.06 for the three months ended June 30, 2026, primarily due to increased throughput and disposal-fee revenue.

Adjusted EBITDA. Adjusted EBITDA increased by $53.4 million for the three months ended June 30, 2026, primarily due to a $101.1 million increase in total revenues and other, partially offset by (i) a $21.1 million increase in operation and maintenance expenses, (ii) a $14.2 million increase in cost of product (net of lower of cost or market inventory adjustments), and (iii) an $8.1 million increase in general and administrative expenses excluding non-cash equity-based compensation expense.

Adjusted EBITDA increased by $208.2 million for the six months ended June 30, 2026, primarily due to a $488.9 million increase in total revenues and other. This amount was offset partially by (i) a $136.1 million increase in cost of product (net of lower of cost or market inventory adjustments), (ii) a $98.5 million increase in operation and maintenance expenses, (iii) a $22.7 million increase in general and administrative expenses excluding non-cash equity-based compensation expense, and (iv) a $15.2 million decrease in distributions from equity investments.

Distributable Cash Flow. Distributable Cash Flow increased by $40.6 million for the three months ended June 30, 2026, primarily due to a $53.4 million increase in Adjusted EBITDA. This amount was offset partially by a $6.7 million increase in cash paid for income taxes.

Distributable Cash Flow decreased by $18.0 million for the six months ended June 30, 2026, primarily due to (i) a $164.6 million increase in recognized service revenues - fee based in excess of (less than) customer billings, (ii) a $31.6 million increase in interest expense (net of interest income), (iii) a $16.0 million increase in cash paid for maintenance capital expenditures, (iv) an $11.3 million increase in cash paid for income taxes, and (v) a $6.7 million increase in capitalized interest. These amounts were offset partially by a $208.2 million increase in Adjusted EBITDA.

Free Cash Flow. Free Cash Flow increased by $21.3 million for the three months ended June 30, 2026, primarily due to a $64.8 million increase in net cash provided by operating activities. This amount was offset partially by (i) a $34.6 million increase in capital expenditures and (ii) a $9.9 million decrease in distributions from equity investments in excess of cumulative earnings.

Free Cash Flow decreased by $281.9 million for the six months ended June 30, 2026, primarily due to (i) a $185.0 million increase in capital expenditures and (ii) a $90.1 million decrease in net cash provided by operating activities.

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