Phillips 66
For the period ended Jun 30, 2025. Filed Jul 28, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Jul 28, 2025
PSX$245.72-0.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-04-25.
0001534701-25-000094
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-07-28.
0001534701-25-000137
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 220 previous paragraphs and 220 current paragraphs.
151 unchanged; 51 reworded; 18 added; 17 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 23 previous and 25 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (18)
Current report
•On May 15, 2025, we entered into a definitive agreement to divest 65% of our equity interest in our Germany and Austria retail marketing business (Germany and Austria Marketing) for expected cash proceeds of approximately $1.6 billion (1.5 billion Euros), subject to purchase price adjustments for working capital and certain long-term liabilities on the closing date. We will retain a 35% non-operating equity interest in Germany and Austria Marketing through a joint venture, which will be formed prior to the closing of the transaction. We expect to complete this transaction in the second half of 2025, subject to regulatory approvals and other customary closing conditions.
Current report
Net income attributable to Phillips 66 in the second quarter of 2025 was $877 million, compared with $1,015 million in the second quarter of 2024. Net income attributable to Phillips 66 for the six months ended June 30, 2025, was $1,364 million, compared with $1,763 million for the six months ended June 30, 2024.
Current report
The decrease in net income attributable to Phillips 66 the six months ended June 30, 2025, was due to lower realized refining margins, accelerated depreciation for the Los Angeles Refinery, and the gain on sale of our ownership interest in REX recognized in the second quarter of 2024, partially offset by a before-tax gain of $1 billion associated with the sale of our investment in Coop recognized in January 2025 and the before-tax impairment of certain Midstream assets recognized in the second quarter of 2024.
Current report
Other income increased $81 million and $40 million for the three and six months ended June 30, 2025, respectively. The increase for the three months ended June 30, 2025, was primarily due to the recognition of Clean Fuel Production credits starting in 2025, as well as higher results from trading activities. The increase for the six months ended June 30, 2025, was primarily due to the recognition of Clean Fuel Production credits starting in 2025, partially offset by changes in the fair value of our investment in NOVONIX.
Current report
Operating expenses increased 2% and 7% for the three and six months ended June 30, 2025, respectively. The increase in the three months ended June 30, 2025, was primarily due to maintenance activity in the Midstream segment, partially offset by lower turnaround activity in the Refining segment. The increase in the six months ended June 30, 2025, was primarily due to higher turnaround activity in the Refining segment and increased maintenance activity in the Midstream segment.
Current report
Interest and debt expense increased 14% and 6% for the three and six months ended June 30, 2025, respectively, primarily due to debt issuances related to an asset acquisition.
Current report
Results from our Midstream segment decreased $36 million and increased $161 million for the three and six months ended June 30, 2025, respectively.
Current report
Results from our Transportation business decreased $305 million and $306 million for the three and six months ended June 30, 2025, respectively, primarily due to the sale of our ownership interest in the REX in the second quarter of 2024.
Current report
Results from our NGL business increased $269 million and $467 million for the three and six months ended June 30, 2025, respectively. The increases for both periods of 2025 were primarily due to before-tax impairment charges associated with certain gathering and processing assets in Texas recognized in 2024 and results from the recently acquired Coastal Bend operations. In addition, the six months ended June 30, 2025, reflected benefits from the sale of DCP LP’s ownership interest in GCX in January 2025, improved export margins, and increased gathering and processing activity in the Permian region associated with our acquisition of Dos Picos.
Current report
Results from our Refining segment increased $57 million and decreased $1,096 million for the three and six months ended June 30, 2025, respectively. The increase in the three months ended June 30, 2025, was primarily driven by improved realized margins, higher volumes and lower operating costs, partially offset by accelerated depreciation for the Los Angeles Refinery. The increase in realized margins was primarily due to higher market crack spreads, partially offset by lower product differentials. The decrease in the six months ended June 30, 2025, was primarily driven by lower realized margins resulting from declining market crack spreads and reduced product differentials, as well as accelerated depreciation for the Los Angeles Refinery.
Current report
Results from the M&S segment increased $156 million and $1,072 million for the three and six months ended June 30, 2025, respectively. The increase in the three months ended June 30, 2025, was primarily due to higher U.S. and international marketing fuel margins, partially offset by a before-tax aggregate unrealized loss of $89 million on foreign currency forward contracts entered into in connection with the Germany and Austria Marketing pending divestiture. The increase in the six months ended June 30, 2025, was primarily due to a before-tax gain of $1 billion associated with the sale of our investment in Coop and higher U.S. and international marketing fuel margins. See Note 7—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information regarding the sale of Coop. See Note 23—Assets Held for Sale in the Notes to Consolidated Financial Statements for additional information related to the Germany and Austria Marketing pending divestiture.
Current report
Results from the Renewable Fuels segment decreased $78 million and $208 million for the three and six months ended June 30, 2025, respectively. The decreases in both periods were primarily due to decreased margins driven by increased feedstock costs and unfavorable hedging impacts, partially offset by increased credit production.
Current report
Net interest expense increased $30 million and $31 million for the three and six months ended June 30, 2025, respectively, primarily due to debt issuances related to an asset acquisition.
Current report
Pending Marketing Divestiture
Current report
On May 15, 2025, we entered into a definitive agreement to divest 65% of our equity interest in Germany and Austria Marketing for expected pre-tax cash proceeds of approximately $1.6 billion (1.5 billion Euros), subject to purchase price adjustments for working capital and certain long-term liabilities on the closing date. We will retain a 35% non-operating equity interest in Germany and Austria Marketing through a new joint venture, which will be formed prior to the closing of the transaction. We expect to close this transaction in the second half of 2025, subject to regulatory approvals and other customary closing conditions. See Note 23—Assets Held for Sale in the Notes to Consolidated Financial Statements for additional information.
Current report
On June 27, 2025, DCP LP early redeemed the outstanding $525 million of its 5.375% Senior Notes due July 2025 with an aggregate principal amount of $825 million.
Current report
Midstream Acquisition
Current report
Includes goodwill and intangibles held in Assets held for sale related to the Germany and Austria Marketing pending divestiture, see Note 23—Assets Held for Sale, in the Notes to Consolidated Financial Statements for additional information.
Removed paragraphs (17)
Previous report
Basis of Presentation
Previous report
Effective April 1, 2024, we changed the internal financial information reviewed by our chief executive officer to evaluate performance and allocate resources to our operating segments. This resulted in changes to the composition of our operating segments, as well as measurement changes for certain activities between our operating segments. The primary effects are summarized below. Prior period information has been recast for comparability.
Previous report
•Establishment of a Renewable Fuels operating segment, which includes renewable fuels activities and assets historically reported in our Refining, M&S and Midstream operating segments.
Previous report
•Change in method of allocating results for certain Gulf Coast distillate export activities from our M&S operating segment to our Refining operating segment.
Previous report
•Reclassification of certain crude oil and international clean products trading activities between our M&S operating segment and our Refining operating segment.
Previous report
•Change in reporting of our investment in NOVONIX Limited (NOVONIX) from our Midstream operating segment to Corporate and Other.
Previous report
Other income decreased 42% for the three months ended March 31, 2025, primarily due to lower results from trading activities, as well as a decrease in the fair value of our investment in NOVONIX. These decreases were partially offset by Clean Fuel Production credits recorded in the first quarter of 2025.
Previous report
Operating expenses increased 12% for the three months ended March 31, 2025. The increase was primarily due to higher turnaround and utility costs.
Previous report
Results from our Midstream segment increased $197 million for the three months ended March 31, 2025.
Previous report
Results from our Transportation business for the three months ended March 31, 2025, were in line with results for the three months ended March 31, 2024.
Previous report
Results from our NGL business increased $198 million for the three months ended March 31, 2025, primarily due to a before-tax gain of $68 million recognized in the first quarter of 2025 on the sale of DCP LP’s 25% ownership interest in GCX, contributions from recently acquired gathering and processing assets, increased liquefied petroleum gas cargo volumes and margins, as well as, improved NGL and natural gas prices and increased fractionation volumes.
Previous report
Results from our Refining segment decreased $1,153 million for the three months ended March 31, 2025, primarily due to lower realized margins as a result of declining market crack spreads, as well as lower volumes and higher costs driven by planned turnaround activity.
Previous report
Results from the M&S segment increased $916 million for the three months ended March 31, 2025. The increase was primarily due to a before-tax gain of $1 billion associated with the sale of our investment in Coop, partially offset by lower domestic marketing fuel margins. Refer to Note 7—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information regarding the sale of Coop.
Previous report
Results from the Renewable Fuels segment decreased $130 million for the three months ended March 31, 2025. The decrease was primarily driven by higher feedstock costs at the Rodeo Complex, partially offset by increased renewable fuels sales.
Previous report
Net interest expense for the three months ended March 31, 2025, was in line with net interest expense for the three months ended March 31, 2024.
Previous report
The fair value of our investment in NOVONIX declined by $15 million in the three months ended March 31, 2025, compared with an increase of $5 million in the three months ended March 31, 2024.
Previous report
Subsequent Midstream Acquisition
Reworded paragraphs (51)
Previous wording
Phillips 66 is uniquely positioned as a leading integrated downstream energy provider operating with Midstream, Chemicals, Refining, Marketing and Specialties (M&S), and Renewable Fuels segments. At March 31, 2025, we had total assets of $71.8 billion. Our common stock trades on the New York Stock Exchange under the symbol PSX.
Current wording
Phillips 66 is uniquely positioned as a leading integrated downstream energy provider operating with Midstream, Chemicals, Refining, Marketing and Specialties (M&S), and Renewable Fuels segments. At June 30, 2025, we had total assets of $75.9 billion. Our common stock trades on the New York Stock Exchange under the symbol PSX.
Previous wording
In the first quarter of 2025, we reported earnings of $487 million and cash provided by operating activities of $187 million. During the quarter, we funded capital expenditures and investments of $423 million and received proceeds from asset dispositions of $2 billion. Additionally, we repaid $1.3 billion of debt, paid $247 million to repurchase shares of our common stock and paid $469 million of dividends to our common stockholders. We ended the first quarter of 2025 with $1.5 billion of cash and cash equivalents and $5.4 billion of total committed capacity available under our credit facilities.
Current wording
In the second quarter of 2025, we reported earnings of $877 million and cash provided by operating activities of $845 million. During the quarter, we funded capital expenditures and investments of $587 million and an acquisition of $2.2 billion, net of cash acquired. Additionally, we received $2.4 billion from net debt borrowings, paid $419 million to repurchase shares of our common stock and paid $487 million of dividends to our common stockholders. We ended the second quarter of 2025 with $1.1 billion of cash and cash equivalents and $3.7 billion of total committed capacity available under our credit facilities.
Previous wording
•In April 2025, our Board of Directors declared a quarterly cash dividend of $1.20 per common share, representing a $0.05 increase, reflecting our commitment to a secure, competitive and growing dividend.
Current wording
•In April and July 2025, our Board of Directors declared quarterly cash dividends of $1.20 per common share, reflecting our commitment to a secure, competitive and growing dividend.
Previous wording
•In January 2025, we closed on the sale of our 49% ownership in Coop Mineraloel AG (Coop) and DCP Midstream, LP’s (DCP LP) 25% ownership in Gulf Coast Express Pipeline LLC (GCX) and received total proceeds of $2 billion. We will continue to evaluate future opportunities to rationalize our asset portfolio. We have budgeted $2.1 billion for 2025 capital expenditures and investments, exclusive of acquisitions, which includes $1.1 billion of growth capital, primarily in our Midstream segment. Refer to Note 7—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information on the investment dispositions.
Current wording
•In January 2025, we closed on the sale of our 49% ownership in Coop Mineraloel AG (Coop) and DCP Midstream, LP’s (DCP LP) 25% ownership in Gulf Coast Express Pipeline LLC (GCX) and received total proceeds of $2 billion. We will continue to evaluate future opportunities to rationalize our asset portfolio. We have budgeted $2.1 billion for 2025 capital expenditures and investments, exclusive of acquisitions, which includes $1.1 billion of growth capital, primarily in our Midstream segment. See Note 7—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information on the investment dispositions.
Previous wording
•We continued expansion of our Midstream NGL wellhead-to-market platform with a recent acquisition. On April 1, 2025, we acquired all issued and outstanding equity interests in each of EPIC Y-Grade GP, LLC and EPIC Y-Grade, LP, together with their respective subsidiaries, which own various long haul natural gas liquids pipelines, fractionation facilities and distribution systems. Refer to Note 3—Business Combinations, in the Notes to Consolidated Financial Statements for additional information.
Current wording
•We continued expansion of our Midstream NGL wellhead-to-market platform through acquiring all issued and outstanding equity interests in each of EPIC Y-Grade GP, LLC and EPIC Y-Grade, LP (collectively referred to herein as Coastal Bend), together with their respective subsidiaries, which own various long haul natural gas liquids pipelines, fractionation facilities and distribution systems. See Note 3—Business Combinations, in the Notes to Consolidated Financial Statements for additional information.
Previous wording
•Our new financial targets through 2027 reflect our plans to grow our Midstream and Chemicals businesses, as well as maintain total annual capital expenditures and investments of approximately $2 billion, excluding acquisitions.
Current wording
•Our new financial targets through 2027 reflect our plans to organically grow our Midstream and Chemicals businesses, as well as maintain total annual capital expenditures and investments of approximately $2 billion, excluding acquisitions.
Previous wording
•Financial Strength and Flexibility – We use a variety of funding sources to support our liquidity requirements, including cash from operations, debt and proceeds from dispositions. Our focus remains on protecting the stable cash generation from the Midstream and Marketing and Specialties (M&S) businesses while balancing continued portfolio optimization.
Current wording
•Financial Strength and Flexibility – We use a variety of funding sources to support our liquidity requirements, including cash from operations, debt and proceeds from dispositions. Our focus remains on protecting the stable cash generation from the Midstream and M&S businesses while balancing continued portfolio optimization.
Previous wording
Our Midstream segment includes our Transportation and natural gas liquids (NGL) businesses. Our Transportation business contains fee-based operations not directly exposed to commodity price risk. Our NGL business, including DCP Midstream Class A Segment, DCP Sand Hills Pipeline, LLC (DCP Sand Hills) and DCP Southern Hills Pipeline, LLC (DCP Southern Hills), contains both fee-based operations and operations directly impacted by NGL and natural gas prices. The weighted-average NGL price was $0.74 per gallon during the first quarter of 2025, compared with $0.70 per gallon during the first quarter of 2024. The Henry Hub natural gas price was $4.27 per million British thermal units (MMBtu) during the first quarter of 2025, compared with $2.41 per MMBtu during the first quarter of 2024. The increases in NGL and natural gas prices were primarily due to colder weather and an increase in liquefied natural gas exports.
Current wording
Our Midstream segment includes our Transportation and natural gas liquids (NGL) businesses. Our Transportation business contains fee-based operations not directly exposed to commodity price risk. Our NGL business, including DCP Midstream Class A Segment, DCP Sand Hills Pipeline, LLC (DCP Sand Hills) and DCP Southern Hills Pipeline, LLC (DCP Southern Hills), contains both fee-based operations and operations directly impacted by NGL and natural gas prices. The weighted-average NGL price was $0.64 per gallon during the second quarter of 2025, compared with $0.68 per gallon during the second quarter of 2024. The Henry Hub natural gas price was $3.16 per million British thermal units (MMBtu) during the second quarter of 2025, compared with $2.04 per MMBtu during the second quarter of 2024. The decrease in NGL prices was primarily due to lower crude oil prices, while the increase in natural gas prices was due to increased liquified natural gas exports.
Previous wording
Our Chemicals segment consists of our 50% equity investment in Chevron Phillips Chemical Company LLC (CPChem). The chemicals and plastics industry is mainly a commodity-based industry where the margins for key products are based on supply and demand, as well as cost factors. The benchmark high-density polyethylene chain margin was 10.9 cents per pound in the first quarter of 2025, compared with 16.4 cents per pound in the first quarter of 2024. The decrease was mainly due to higher natural gas and ethane prices and lower polyethylene demand.
Current wording
Our Chemicals segment consists of our 50% equity investment in Chevron Phillips Chemical Company LLC (CPChem). The chemicals and plastics industry is mainly a commodity-based industry where the margins for key products are based on supply and demand, as well as cost factors. The benchmark high-density polyethylene chain margin was 7.4 cents per pound in the second quarter of 2025, compared with 18.3 cents per pound in the second quarter of 2024. The decrease was mainly due to higher natural gas and ethane prices and lower polyethylene demand.
Previous wording
Our Refining segment results are driven by several factors, including market crack spreads, refinery throughput, feedstock costs, product yields, turnaround activity, and other operating costs. Market crack spreads are used as indicators of refining margins and measure the difference between market prices for refined petroleum products and crude oil. The composite 3:2:1 market crack spread for our business decreased to an average of $15.83 per barrel during the first quarter of 2025, from an average of $19.45 per barrel during the first quarter of 2024. The decrease in the composite market crack spread was primarily driven by market instability as geopolitical events drove demand concerns. The price of U.S. benchmark crude oil, West Texas Intermediate (WTI) at Cushing, Oklahoma, decreased to an average of $71.46 per barrel during the first quarter of 2025, from an average of $77.07 per barrel during the first quarter of 2024, primarily due to increased supply.
Current wording
Our Refining segment results are driven by several factors, including market crack spreads, refinery throughput, feedstock costs, product yields, turnaround activity, and other operating costs. Market crack spreads are used as indicators of refining margins and measure the difference between market prices for refined petroleum products and crude oil. The composite 3:2:1 market crack spread for our business increased to an average of $21.65 per barrel during the second quarter of 2025, from an average of $18.96 per barrel during the second quarter of 2024. The increase in the composite market crack spread was primarily driven by stronger year on year petroleum diesel demand, which has resulted in low seasonal inventories. The price of U.S. benchmark crude oil, West Texas Intermediate (WTI) at Cushing, Oklahoma, decreased to an average of $63.86 per barrel during the second quarter of 2025, from an average of $80.73 per barrel during the second quarter of 2024, primarily due to increased supply.
Previous wording
Unless otherwise indicated, discussion of results for the three months ended March 31, 2025, is based on a comparison with the corresponding period of 2024.
Current wording
Unless otherwise indicated, discussion of results for the three and six months ended June 30, 2025, is based on a comparison with the corresponding period of 2024.
Previous wording
Our net income attributable to Phillips 66 in the first quarter of 2025 was $487 million, compared with $748 million in the first quarter of 2024. The decrease was primarily due to a decline in realized refining margins primarily driven by lower market crack spreads, as well as lower volumes and higher costs driven by planned turnaround activity. The decrease was also attributable to lower equity earnings from CPChem and declining domestic marketing fuel margins. These decreases were partially offset by a before-tax gain of $1 billion associated with the sale of our investment in Coop recognized in our M&S segment.
Current wording
The decrease in net income attributable to Phillips 66 in the second quarter of 2025, was due to accelerated depreciation for the Los Angeles Refinery, lower equity earnings from CPChem and a gain on the sale of our ownership interest in Rockies Express Pipeline LLC (REX) that was recognized in 2024. These decreases were partially offset by higher U.S. and international marketing fuel margins, improved realized refining margins, primarily driven by higher market crack spreads, and a before-tax impairment of certain Midstream assets recognized in 2024.
Previous wording
See the “Segment Results” section for additional information on our segment results.
Current wording
See the “Segment Results” section for additional information on our segment results and Note 21—Income Taxes, in the Notes to Consolidated Financial Statements for additional information on income taxes.
Previous wording
Sales and other operating revenues andpurchased crude oil and products decreased 15% for the three months ended March 31, 2025. The decreases in both line items were due to lower prices for refined petroleum products and crude oil, partially offset by an increase in prices for NGL, as well as lower volumes primarily attributable to turnaround activity.
Current wording
Sales and other operating revenues decreased 13% and 14% for the three and six months ended June 30, 2025, respectively. Purchased crude oil and products decreased 16% and 15% for the three and six months ended June 30, 2025, respectively. The decreases in both line items for the three months ended June 30, 2025, were due to lower prices for crude oil and refined petroleum products, as well as reduced marketing volumes, partially offset by higher refining volumes. The decreases in both line items for the six months ended June 30, 2025, were due to lower prices for crude oil and refined petroleum products.
Previous wording
Equity in earnings of affiliates decreased 71% for the three months ended March 31, 2025. The decrease was primarily attributable to lower equity earnings from WRB Refining LP (WRB) resulting from lower margins, as well as lower equity earnings from CPChem. See the Chemicals segment analysis in the “Segment Results” section for additional information regarding CPChem.
Current wording
Equity in earnings of affiliates decreased 69% and 70% for the three and six months ended June 30, 2025, respectively. The decreases for both periods of 2025 were primarily attributable to lower equity earnings from CPChem, as well as lower equity earnings from sales of ownership interests in REX, Coop and GCX. The decrease for the six months ended June 30, 2025, was additionally impacted by lower equity earnings from WRB, as a result of decreased margins. See the Chemicals segment analysis in the “Segment Results” section for additional information regarding CPChem. See Note 7—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information regarding the sales of ownership interests.
Previous wording
Net gain on dispositions increased $1,087 million for the three months ended March 31, 2025, primarily due to a before-tax gain of $1 billion associated with the sale of our investment in Coop recognized in the M&S segment. Refer to Note 7—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information regarding the sale of Coop.
Current wording
We had anet loss on dispositions of $93 million for the second quarter of 2025, compared with anet gain on dispositions of $237 million in the second quarter of 2024. The decrease for the three months ended June 30, 2025, was due to a before-tax gain of $238 million recognized in the Midstream segment in the second quarter of 2024 associated with the sale of our 25% ownership interest in REX, compared with a before-tax loss primarily associated with an aggregate unrealized loss of $89 million on foreign currency forward contracts entered into in connection with the pending divestiture of 65% of Germany and Austria Marketing recognized in the second quarter of 2025. Ournet gain on dispositions increased $757 million for the six months ended June 30, 2025. The increase for the six months ended June 30, 2025, was primarily due to a before-tax gain of $1 billion associated with the sale of our investment in Coop recognized in the M&S segment in 2025, partially offset by the before-tax gain of $238 million recognized in the Midstream segment in the second quarter of 2024. See Note 7—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information regarding the sale of Coop. See Note 23—Assets Held for Sale or Sold, in the Notes to Consolidated Financial Statements for additional information on the Germany and Austria Marketing pending divestiture.
Previous wording
Depreciation and amortization increased 57% for the three months ended March 31, 2025, primarily due to $246 million of accelerated depreciation recorded in the first quarter of 2025 associated with our plan to cease operations at our Los Angeles Refinery in the fourth quarter of 2025. See Note 2—Restructuring, in the Notes to Consolidated Financial Statements for information regarding our plans to cease operations at our Los Angeles Refinery.
Current wording
Depreciation and amortization increased 64% and 61% for the three and six months ended June 30, 2025, respectively, primarily due to $239 million and $485 million of accelerated depreciation for the Los Angeles Refinery, respectively, as well as depreciation from the recent acquisition of Coastal Bend. See Note 2—Restructuring, in the Notes to Consolidated Financial Statements for information regarding our plans to cease operations and begin idling the facilities at our Los Angeles Refinery. See Note 3—Business Combinations, in the Notes to Consolidated Financial Statements for information regarding the Coastal Bend acquisition.
Previous wording
Impairments decreased 84% for the three months ended March 31, 2025. The decrease for the three months ended March 31, 2025, was primarily due to before-tax impairments of $163 million recorded in our Refining and Midstream segments in the first quarter of 2024 related to certain crude oil processing and logistics assets in California. See Note 9—Impairments, in the Notes to Consolidated Financial Statements for additional information regarding impairments.
Current wording
Impairments decreased $221 million and $360 million for the three and six months ended June 30, 2025, respectively. The decreases for both periods of 2025 were due to before-tax impairments of $224 million recognized in the second quarter of 2024 related to certain Midstream gathering and processing assets in Texas. The decrease for the six months ended June 30, 2025, also included $163 million of before-tax impairments recognized in the first quarter of 2024 related to certain crude oil processing and logistics assets in California. See Note 9—Impairments, in the Notes to Consolidated Financial Statements for additional information.
Previous wording
Taxes other than income taxes increased 41% for the three months ended March 31, 2025. The increase was primarily driven by the expiration of the Biodiesel Blender Tax Credit, as well as an increase in taxes related to feedstock imports at the Rodeo Complex.
Current wording
Taxes other than income taxes increased $169 million and $237 million for the three and six months ended June 30, 2025, respectively. The increases for both periods in 2025 were primarily driven by the expiration of the Biodiesel Blender Tax Credit as of December 31, 2024, as well as increased property taxes on certain Midstream assets. The increase for the six months ended June 30, 2025, was also impacted by an increase in taxes related to feedstock imports at the Rodeo Complex.
Previous wording
Income tax expense decreased 40% for the three months ended March 31, 2025, primarily due to lower income before income taxes. See Note 20—Income Taxes, in the Notes to Consolidated Financial Statements for information regarding our effective income tax rates.
Current wording
Income tax expense decreased 27% and 32% for the three and six months ended June 30, 2025, respectively, primarily due to lower income before income taxes. See Note 21—Income Taxes, in the Notes to Consolidated Financial Statements for information regarding our effective income tax rates.
Previous wording
Net income attributable to noncontrolling interests increased $26 million for the three months ended March 31, 2025, due to higher results from DCP LP primarily driven by the sale of GCX in January 2025. See Note 7—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information regarding the sale of GCX.
Current wording
Net income attributable to noncontrolling interests increased $26 million and $52 million for the three and six months ended June 30, 2025, respectively. The increase in the three months ended June 30, 2025, is due to higher results from DCP LP primarily driven by before-tax impairments of $224 million recognized in the second quarter of 2024 related to certain Midstream gathering and processing assets in Texas. The increase for the six months ended June 30, 2025, was also due to impacts from the gain on sale of DCP LP’s investment in GCX in January 2025. See Note 7—Investments, Loans and Long-Term Receivables and Note 9—Impairments, in the Notes to Consolidated Financial Statements for additional information regarding the sale of GCX and the before-tax impairments recorded in 2024, respectively.
Previous wording
*** Represents volumes delivered to major fractionation market hubs, including Mont Belvieu, Sweeny and Conway. Includes 100% of DCP Midstream Class A Segment and Phillips 66’s direct interest in DCP Sand Hills and DCP Southern Hills.
Current wording
*** Represents volumes delivered to fractionation market hubs, including Mont Belvieu, Sweeny and Conway. Includes 100% of DCP Midstream Class A Segment and Phillips 66’s direct interest in DCP Sand Hills and DCP Southern Hills.
Previous wording
Results from the Chemicals segment decreased $92 million for the three months ended March 31, 2025, primarily due to decreased polyethylene margins driven by lower sales prices and higher feedstock costs, lower volumes, and increased utility costs.
Current wording
Results from the Chemicals segment decreased $202 million and $294 million for the three and six months ended June 30, 2025, respectively. The decrease in the three months ended June 30, 2025, was primarily driven by lower polyethylene margins due to lower sales prices and higher feedstock costs. The decrease in the six months ended June 30, 2025, was primarily due to decreased polyethylene margins driven by lower sales prices.
Previous wording
In October 2024, we announced our intention to cease operations at our Los Angeles Refinery in the fourth quarter of 2025, and we are evaluating potential future uses of the property. See Note 2—Restructuring, in the Notes to Consolidated Financial Statements for additional information. In early 2024, we ceased crude operations at the San Francisco Refinery as part of the conversion of the refinery into the Rodeo Complex.
Current wording
In October 2024, we announced our intention to cease operations and begin idling the facilities at our Los Angeles Refinery in the fourth quarter of 2025, and we are evaluating potential future uses of the property. See Note 2—Restructuring, in the Notes to Consolidated Financial Statements for additional information. In early 2024, we ceased crude operations at the San Francisco Refinery as part of the conversion of the refinery into the Rodeo Complex.
Previous wording
Our worldwide refining crude oil capacity utilization rate was 80% and 92% for the three months ended March 31, 2025 and 2024, respectively. The decrease for the three months ended March 31, 2025, was primarily due to higher turnaround activity. See the “Executive Overview and Business Environment” section for information on market factors impacting this quarter’s results.
Current wording
Our worldwide refining crude oil capacity utilization rate was 98% and 89% for the three and six months ended June 30, 2025, respectively, compared with 98% and 95% in the three and six months ended June 30, 2024, respectively. The decrease for the six months ended June 30, 2025, was primarily due to higher turnaround activity. See the “Executive Overview and Business Environment” section for information on market factors impacting this quarter’s results.
Previous wording
Corporate overhead and other costs increased $33 million for the three months ended March 31, 2025, primarily due to higher depreciation expense associated with information technology assets and a charge of $21 million associated with canceled projects, partially offset by lower employee-related expenses.
Current wording
Corporate overhead and other costs increased $63 million and $96 million for the three and six months ended June 30, 2025, respectively. The increases for both periods of 2025 were primarily due to higher depreciation expense associated with information technology assets and advisory fees related to proxy solicitation services.
Previous wording
To meet our short- and long-term liquidity requirements, we use a variety of funding sources but rely primarily on cash generated from operating activities and debt financing. During the first three months of 2025, we generated $187 million of cash from operations. We funded capital expenditures and investments of $423 million and received proceeds from asset dispositions of $2 billion. Additionally, we repaid $1.3 billion of debt, paid $247 million to repurchase shares of our common stock and paid $469 million of dividends to our common stockholders. During the first three months of 2025, cash and cash equivalents decreased to $1.5 billion. At this time, we believe that our cash on hand, as well as the sources of liquidity described herein, will be sufficient to fund our obligations over the short- and long-term.
Current wording
To meet our short- and long-term liquidity requirements, we use a variety of funding sources but rely primarily on cash generated from operating activities and debt financing. During the first six months of 2025, we generated $1 billion of cash from operations. We received proceeds from asset dispositions of $2 billion and received $1.1 billion from net debt borrowings. We funded capital expenditures and investments of $1 billion and an acquisition of $2.2 billion, net of cash acquired. Additionally, we paid $666 million to repurchase shares of our common stock and paid $956 million of dividends to our common stockholders. During the first six months of 2025, cash and cash equivalents decreased by $686 million. At this time, we believe that our cash on hand, as well as the sources of liquidity described herein, will be sufficient to fund our obligations over the short- and long-term.
Previous wording
During the first three months of 2025, cash generated by operating activities was $187 million, compared with cash used in operations of $236 million for the first three months of 2024. The increase was primarily due to more favorable working capital impacts, partially offset by lower earnings.
Current wording
During the first six months of 2025, cash generated by operating activities was $1 billion, compared with $1.9 billion for the first six months of 2024. The decrease was primarily due to unfavorable working capital impacts and lower earnings.
Previous wording
Our operating cash flows are also impacted by distribution decisions made by our equity affiliates. During the first three months of 2025, cash from operations included aggregate distributions of $273 million from our equity affiliates, while cash from operations during the first three months of 2024 included aggregate distributions of $348 million from our equity affiliates. We cannot control the amount of future dividends from equity affiliates; therefore, future dividend payments by these equity affiliates are not assured.
Current wording
Our operating cash flows are also impacted by distribution decisions made by our equity affiliates. During the first six months of 2025, cash from operations included aggregate distributions of $501 million from our equity affiliates, while cash from operations during the first six months of 2024 included aggregate distributions of $656 million from our equity affiliates. We cannot control the amount of future dividends from equity affiliates; therefore, future dividend payments by these equity affiliates are not assured.
Previous wording
On September 30, 2024, Phillips 66 Company entered into a 364-day, $500 million accounts receivable securitization facility (the Receivables Securitization Facility). Under the Receivables Securitization Facility, Phillips 66 Company sells or contributes on an ongoing basis, certain of its receivables, together with related security and interests in the proceeds thereof, to its wholly owned subsidiary, Phillips 66 Receivables LLC (P66 Receivables), a consolidated and bankruptcy-remote special purpose entity created for the sole purpose of transacting under the Receivables Securitization Facility. Under the Receivables Securitization Facility, P66 Receivables may borrow and incur indebtedness from, and/or sell certain receivables in an amount not to exceed $500 million in the aggregate, and will secure its obligations with a pledge of undivided interests in such receivables, together with related security and interests in the proceeds thereof, to PNC Bank, National Association, as Administrative Agent, for the benefit of the secured parties thereunder.
Current wording
On September 30, 2024, Phillips 66 Company entered into a 364-day, $500 million accounts receivable securitization facility (the Receivables Securitization Facility). Under the Receivables Securitization Facility, Phillips 66 Company sells or contributes on an ongoing basis, certain of its receivables, together with related security and interests in the proceeds thereof, to its wholly owned subsidiary, Phillips 66 Receivables LLC (P66 Receivables), a consolidated and bankruptcy-remote special purpose entity created for the sole purpose of transacting under the Receivables Securitization Facility. On April 1, 2025, Phillips 66 Company amended the Receivables Securitization Facility to, among other things, increase the maximum size of the Receivables Securitization Facility from $500 million to $1 billion. Under the Receivables Securitization Facility, P66 Receivables may borrow and incur indebtedness from, and/or sell certain accounts receivable in an amount not to exceed $1 billion in the aggregate, and will secure its obligations with a pledge of undivided interests in such accounts receivable, together with related security and interests in the proceeds thereof, to PNC Bank, National Association, as Administrative Agent, for the benefit of the secured parties thereunder. Accounts outstanding under the Receivables Securitization Facility accrue interest at an adjusted term Secured Overnight Financing Rate (SOFR) plus the applicable margin. In all instances, Phillips 66 Company retains the servicing of the accounts receivable transferred.
Previous wording
Sales of accounts receivables under the Receivables Securitization Facility meet the sale criteria under ASC 860, Transfers and Servicing, and are derecognized from the consolidated balance sheet. P66 Receivables guarantees payment, in full, for accounts receivables sold to the purchasers. For the three months ended March 31, 2025, we sold $130 million of accounts receivables for cash proceeds under the Receivables Securitization Facility. We recognized an immaterial charge associated with the transfer of financial assets, which is included as a component within the line item “Selling, general and administrative expense” on our consolidated statement of income during the three months ended March 31, 2025.
Current wording
Sales of accounts receivable under the Receivables Securitization Facility meet the sale criteria under ASC 860, Transfers and Servicing, and are derecognized from the consolidated balance sheet. P66 Receivables guarantees payment, in full, for accounts receivable sold to the purchasers. For the three months ended June 30, 2025, we sold $303 million of accounts receivable in exchange for a $303 million reduction in our borrowings under the Receivables Securitization Facility, which was recognized as a non-cash financing transaction. For the six months ended June 30, 2025, we sold $433 million in accounts receivable in exchange for cash proceeds of $130 million and a $303 million reduction in our borrowings under the Receivables Securitization Facility. We recognized immaterial charges associated with the transfer of financial assets, which are included as a component within the line item “Selling, general and administrative expense” on our consolidated statement of income during the three and six months ended June 30, 2025.
Previous wording
At March 31, 2025, we had utilized $130 million of our $500 million Receivable Securitization Facility from sold accounts receivables not yet remitted to the purchaser. Additionally, we had no outstanding borrowings at March 31, 2025. Therefore, at March 31, 2025, we had unused capacity of $370 million. At December 31, 2024, we had utilized the full $500 million of our Receivables Securitization Facility from $125 million of sold accounts receivables not yet remitted to the purchaser and $375 million of outstanding borrowings.
Current wording
At June 30, 2025, we had utilized the full $1 billion capacity of ourReceivable Securitization Facility from $303 million of sold accounts receivable not yet remitted to the purchaser and $697 million of outstanding borrowings, which is recognized within the “Short-term debt” line item on our consolidated balance sheet. At December 31, 2024, we had utilized the full $500 million capacity of our Receivables Securitization Facility from $125 million of sold accounts receivable not yet remitted to the purchaser and $375 million of outstanding borrowings. The outstanding borrowings at June 30, 2025, and December 31, 2024, were secured by approximately $4.5 billion and $4.6 billion of accounts receivable held by P66 Receivables at June 30, 2025, and December 31, 2024, respectively, which are included within the “Accounts and notes receivable” line item on our consolidated balance sheet.
Previous wording
On January 13, 2025, we entered into a $200 million uncommitted credit facility (the 2025 Uncommitted Facility) with Phillips 66 Company as the borrower and Phillips 66 as the guarantor. The 2025 Uncommitted Facility contains covenants and events of default customary for unsecured uncommitted facilities. The 2025 Uncommitted Facility has no commitment fees or compensating balance requirements. Outstanding borrowings under the 2025 Uncommitted Facility bear interest at a rate of either (a) the adjusted term SOFR plus the applicable margin, (b) the adjusted daily simple SOFR plus the applicable margin or (c) the base rate, in each case plus the applicable margin. Each borrowing matures six months from the date of such borrowing. We may at any time prepay outstanding borrowings, in whole or in part, without premium or penalty. At March 31, 2025, no amount had been drawn under the 2025 Uncommitted Facility.
Current wording
On January 13, 2025, we entered into a $200 million uncommitted credit facility (the 2025 Uncommitted Facility) with Phillips 66 Company as the borrower and Phillips 66 as the guarantor. The 2025 Uncommitted Facility contains covenants and events of default customary for unsecured uncommitted facilities. The 2025 Uncommitted Facility has no commitment fees or compensating balance requirements. Outstanding borrowings under the 2025 Uncommitted Facility bear interest at a rate of either (a) the adjusted term SOFR plus the applicable margin, (b) the adjusted daily simple SOFR plus the applicable margin or (c) the base rate, in each case plus the applicable margin. Each borrowing matures six months from the date of such borrowing. We may at any time prepay outstanding borrowings, in whole or in part, without premium or penalty. At June 30, 2025, $200 million of borrowings were outstanding under the 2025 Uncommitted Facility.
Previous wording
On June 25, 2024, we entered into a $400 million uncommitted credit facility (the Uncommitted Facility) with Phillips 66 Company as the borrower and Phillips 66 as the guarantor. The Uncommitted Facility contains covenants and events of default customary for unsecured uncommitted facilities. The Uncommitted Facility has no commitment fees or compensating balance requirements. Outstanding borrowings under the Uncommitted Facility bear interest at a rate of either (a) the adjusted term SOFR, (b) the adjusted daily simple SOFR or (c) the reference rate, in each case plus the applicable margin. Each borrowing matures six months from the date of such borrowing. We may at any time prepay outstanding borrowings, in whole or in part, without premium or penalty. At March 31, 2025, no amount had been drawn under the 2024 Uncommitted Facility, while at December 31, 2024, the entire $400 million had been drawn.
Current wording
On June 25, 2024, we entered into a $400 million uncommitted credit facility (the 2024 Uncommitted Facility) with Phillips 66 Company as the borrower and Phillips 66 as the guarantor. The 2024 Uncommitted Facility contains covenants and events of default customary for unsecured uncommitted facilities. The 2024 Uncommitted Facility has no commitment fees or compensating balance requirements. Outstanding borrowings under the 2024 Uncommitted Facility bear interest at a rate of either (a) the adjusted term SOFR, (b) the adjusted daily simple SOFR or (c) the reference rate, in each case plus the applicable margin. Each borrowing matures six months from the date of such borrowing. We may at any time prepay outstanding borrowings, in whole or in part, without premium or penalty. At June 30, 2025, and December 31, 2024, $400 million of borrowings were outstanding under the 2024 Uncommitted Facility.
Previous wording
Phillips 66 also has a $5 billion uncommitted commercial paper program for short-term working capital needs that is supported by the Facility. Commercial paper maturities are contractually limited to less than one year. At March 31, 2025, no borrowings were outstanding under this program, while at December 31, 2024, $435 million of commercial paper had been issued under this program.
Current wording
Phillips 66 also has a $5 billion uncommitted commercial paper program for short-term working capital needs that is supported by the Facility. Commercial paper maturities are contractually limited to less than one year. At June 30, 2025, we had $1,349 million borrowings outstanding under this program, while at December 31, 2024, $435 million of commercial paper had been issued under this program.
Previous wording
At March 31, 2025, and December 31, 2024, we had approximately $5.4 billion and $4.6 billion, respectively, of total committed capacity available under the credit facilities described above.
Current wording
At June 30, 2025, and December 31, 2024, we had approximately $3.7 billion and $4.6 billion, respectively, of total committed capacity available under the credit facilities described above.
Previous wording
Our debt balance at March 31, 2025, and December 31, 2024, was $18.8 billion and $20.1 billion, respectively. Our total debt-to-capital ratio was 40% and 41% at March 31, 2025, and December 31, 2024, respectively.
Current wording
Our debt balance at June 30, 2025, and December 31, 2024, was $20.9 billion and $20.1 billion, respectively. Our total debt-to-capital ratio was 42% and 41% at June 30, 2025, and December 31, 2024, respectively.
Previous wording
On April 1, 2025, we acquired all issued and outstanding equity interests in each of EPIC Y-Grade GP, LLC and EPIC Y-Grade, LP, together with their respective subsidiaries, which own various long haul natural gas liquids pipelines, fractionation facilities and distribution systems, for cash consideration of $2.2 billion, net of cash acquired. This acquisition was funded with cash and borrowings under our short-term liquidity facilities.
Current wording
During the second quarter of 2025, we completed the Coastal Bend acquisition, for total consideration of $2.2 billion, net of cash acquired. This acquisition was funded with cash and borrowings under our short-term liquidity facilities. See Note 3—Business Combinations, in the Notes to Consolidated Financial Statements for additional information.
Previous wording
On February 12, 2025, our Board of Directors declared a quarterly cash dividend of $1.15 per common share. This dividend was paid on March 5, 2025, to holders of record at the close of business on February 24, 2025. On April 21, 2025, our Board of Directors declared a quarterly cash dividend of $1.20 per common share. This dividend is payable on June 2, 2025, to shareholders of record as of the close of business on May 19, 2025.
Current wording
On April 21, 2025, our Board of Directors declared a quarterly cash dividend of $1.20 per common share. This dividend was paid on June 2, 2025, to shareholders of record as of the close of business on May 19, 2025. On July 10, 2025, our Board of Directors declared a quarterly cash dividend of $1.20 per common share. This dividend is payable on September 2, 2025, to shareholders of record as of the close of business on August 19, 2025.
Previous wording
Since July 2012, our Board of Directors has authorized an aggregate of $25 billion of repurchases of our outstanding common stock under our share repurchase program. Our share repurchase authorizations do not expire. Any future share repurchases will be made at the discretion of management and will depend on various factors including our share price, results of operations, financial condition and cash required for future business plans. For the three months ended March 31, 2025, we repurchased 2 million shares at an aggregate cost of approximately $0.2 billion. Since July 2012, we have repurchased 240 million shares under our share repurchase program at an aggregate cost of $21.8 billion. Shares of stock repurchased are held as treasury shares.
Current wording
Since July 2012, our Board of Directors has authorized an aggregate of $25 billion of repurchases of our outstanding common stock under our share repurchase program. Our share repurchase authorizations do not expire. Any future share repurchases will be made at the discretion of management and will depend on various factors including our share price, results of operations, financial condition and cash required for future business plans. For the six months ended June 30, 2025, we repurchased 6 million shares at an aggregate cost of approximately $0.6 billion. Since July 2012, we have repurchased 244 million shares under our share repurchase program at an aggregate cost of $22.1 billion. Shares of stock repurchased are held as treasury shares.
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Previous report — wording carried elsewhere
On April 1, 2025, Phillips 66 Company amended the Receivables Securitization Facility to, among other things, increase the maximum size of the Receivables Securitization Facility from $500 million to $1 billion.