VALERO ENERGY CORP/TX

Previous wording

•expectations regarding the levels of, and costs and timing with respect to, the production and operations at our existing refineries and plants, projects under evaluation, construction, or development, and former projects;

Current wording

•our evaluation of strategic opportunities, including our expectations regarding the levels of, and costs and timing with respect to, the production and operations at our existing refineries and plants, projects under evaluation, construction, or development, and former projects;

Previous wording

•expectations regarding our counterparties and VIEs, including our ability to pass on increased compliance costs and timely collect receivables, and the credit risk within our accounts receivable or accounts payable;

Current wording

•expectations regarding our counterparties and VIEs, including our ability to pass on increased compliance costs and collect receivables in a timely manner, and the credit risk within our accounts receivable or accounts payable;

Previous wording

•expectations regarding adoptions of new, or changes to existing, low-carbon fuel regulations, policies, and standards issued by governments across the world to address greenhouse gas (GHG) emissions and the percentage of low-carbon fuels in the transportation fuel mix, including, but not limited to, the Renewable and Low-Carbon Fuel Programs, tax credits, efficiency standards, or other waivers, benefits, or incentives that impact the demand for low-carbon fuels; and

Current wording

•expectations regarding the adoption of new, or changes to existing, low-carbon fuel regulations, policies, and standards issued by governments across the world to address greenhouse gas (GHG) emissions and the percentage of low-carbon fuels in the transportation fuel mix, including, but not limited to, the Renewable and Low-Carbon Fuel Programs, tax credits, efficiency standards, or other waivers, benefits, or incentives that impact the demand for low-carbon fuels; and

Previous wording

•the effects of war or hostilities, and political and economic conditions, in or affecting geographic areas that produce crude oil or other feedstocks, are key areas for crude oil and refined petroleum product transportation, or consume refined petroleum products, renewable diesel, SAF, ethanol, or corn-related co-products;

Current wording

•the effects of war or hostilities, and political and economic conditions, in or affecting geographic areas that produce crude oil or other feedstocks, are key areas for crude oil and refined petroleum product transportation, or produce or consume refined petroleum products, renewable diesel, SAF, ethanol, or corn-related co-products;

Previous wording

•the volatility in the market price of compliance credits (primarily RINs needed to comply with the RFS) under the Renewable and Low-Carbon Fuel Programs;

Current wording

•the volatility in the market price and availability of compliance credits (primarily RINs needed to comply with the RFS) under the Renewable and Low-Carbon Fuel Programs, as well as governmental actions regarding, and the impact associated with, small refinery exemptions and reallocations of compliance obligations under the RFS;

Previous wording

The following discussions in “OVERVIEW AND OUTLOOK,” “RESULTS OF OPERATIONS,” and “LIQUIDITY AND CAPITAL RESOURCES” include references to financial measures that are not defined under GAAP. These non-GAAP financial measures include Refining, Renewable Diesel, and Ethanol segment margin; adjusted operating income (including adjusted operating income for each of our reportable segments, as applicable); and capital investments attributable to Valero. We have included these non-GAAP financial measures to help facilitate the comparison of operating results between periods, to help assess our cash flows, and because we believe they provide useful information as discussed further below. Refer to the tables in note (c), beginning on page 57, for the reconciliations of Refining, Renewable Diesel, and Ethanol segment margin and adjusted operating income (including adjusted operating income for each of our reportable segments, as applicable) to their most directly comparable GAAP financial measures. Also in note (c), we disclose the reasons why we believe our use of such non-GAAP financial measures provides useful information. See the table on page 63 for a reconciliation of capital investments attributable to Valero to its most directly comparable GAAP financial measure. Beginning on page 62, we disclose the reasons why we believe our use of this non-GAAP financial measure provides useful information.

Current wording

The following discussions in “OVERVIEW AND OUTLOOK,” “RESULTS OF OPERATIONS,” and “LIQUIDITY AND CAPITAL RESOURCES” include references to financial measures that are not defined under GAAP. These non-GAAP financial measures include Refining, Renewable Diesel, and Ethanol segment margin; adjusted operating income (including adjusted operating income for each of our reportable segments, as applicable); Refining segment adjusted operating expenses (excluding depreciation and amortization expense); and capital investments attributable to Valero. We have included these non-GAAP financial measures to help facilitate the comparison of operating results between periods, to help assess our cash flows, and because we believe they provide useful information as discussed further below. Refer to the tables in note (d), beginning on page 56, for the reconciliations of Refining, Renewable Diesel, and Ethanol segment margin; adjusted operating income (including adjusted operating income for each of our reportable segments, as applicable); and adjusted Refining operating expenses (excluding depreciation and amortization expense) to their most directly comparable GAAP financial measures. Also in note (d), we disclose the reasons why we believe our use of such non-GAAP financial measures provides useful information. See the table on page 63 for a reconciliation of capital investments attributable to Valero to its most directly comparable GAAP financial measure. Beginning on page 62, we disclose the reasons why we believe our use of this non-GAAP financial measure provides useful information.

Previous wording

Our results for the second quarter and first six months of 2026 benefited from strong global demand for petroleum-based transportation fuels amid constrained worldwide supply. Geopolitical developments continued to disrupt global commodity markets and further limited refining capacity, exacerbating the imbalance between supply and demand. These conditions led to higher market prices for petroleum-based transportation fuels, as well as increased prices for crude oil and other feedstocks used in their production. Despite higher feedstock costs, the spread between product prices and input costs resulted in strong refining margins during the second quarter and first six months of 2026. However, refining margins remain sensitive to changes in global supply and demand dynamics, feedstock costs, and geopolitical developments, and sustained price volatility or shifts in these factors could impact future results.

Current wording

Our results for the third quarter and first nine months of 2026 benefited from resilient global demand for petroleum-based transportation fuels amid constrained worldwide supply. Geopolitical developments continued to disrupt global commodity markets and further limited refining capacity, exacerbating the imbalance between supply and demand. These conditions led to higher market prices for petroleum-based transportation fuels, as well as increased prices for crude oil and other feedstocks used in their production. Despite higher feedstock costs, the spread between product prices and input costs resulted in strong refining margins during the third quarter and first nine months of 2026. However, refining margins remain sensitive to changes in global supply and demand dynamics, feedstock costs, and geopolitical developments, and sustained price volatility or shifts in these factors could impact future results.

Previous wording

Our results for the second quarter and first six months of 2026 were also impacted by the phased idling of processing units and cessation of refining operations at our Benicia Refinery, which was completed by the end of April. See Note 2 of Condensed Notes to Consolidated Financial Statements for additional information related to our Benicia Refinery.

Current wording

Our results for the first nine months of 2026 were also impacted by the phased idling of processing units and cessation of refining operations at our Benicia Refinery, which was completed by the end of April. See Note 2 of Condensed Notes to Consolidated Financial Statements for additional information related to our Benicia Refinery.

Previous wording

In addition, on March 23, 2026, our Port Arthur Refinery experienced a fire in one of its distillate hydrotreater units, which prompted a full shut-down of the refinery. The refinery resumed operations in April 2026 at reduced throughput rates and returned to normal throughput rates during the second quarter. As a result of the outage and the phased restart of the processing units, the refinery’s throughput volumes during the second quarter of 2026 were lower than typical throughput rates. See Note 5 of Condensed Notes to Consolidated Financial Statements for additional information related to this incident.

Current wording

In addition, on March 23, 2026, our Port Arthur Refinery experienced a fire in one of its distillate hydrotreater units, which prompted a full shut-down of the refinery. The refinery resumed operations in April 2026 at reduced throughput rates and returned to normal throughput rates during the second quarter. See Note 5 of Condensed Notes to Consolidated Financial Statements for additional information related to this incident.

Previous wording

The strong demand for our products and continued strength in refining margins are the primary contributors to us reporting $3.7 billion and $5.0 billion of net income attributable to Valero stockholders for the second quarter of 2026 and the first six months of 2026, respectively. Our operating results, including operating results by segment, are described in the following summary under “Second Quarter Results” and “First Six Months Results,” and detailed descriptions can be found under “RESULTS OF OPERATIONS” beginning on page 43.

Current wording

The resilient demand for our products and continued strength in refining margins are the primary contributors to us reporting $6.8 billion and $11.8 billion of net income attributable to Valero stockholders for the third quarter of 2026 and the first nine months of 2026, respectively. Our operating results, including operating results by segment, are described in the following summary under “Third Quarter Results” and “First Nine Months Results,” and detailed descriptions can be found under “RESULTS OF OPERATIONS” beginning on page 43.

Previous wording

Our operations generated $7.0 billion of cash during the first six months of 2026. Also, we issued $850 million of 5.150 percent Senior Notes due March 10, 2036 during the first six months of 2026, as described in Note 4 of Condensed Notes to Consolidated Financial Statements. The cash generated by our operations was used to make $798 million of capital investments in our business and return $3.6 billion to our stockholders through purchases of common stock for treasury and dividend payments. As a result of these items, along with the net proceeds from our debt issuance and other activities, our cash, cash equivalents, and restricted cash increased by $3.2 billion during the first six months of 2026 to $8.1 billion as of June 30, 2026. We had $12.7 billion in liquidity as of June 30, 2026. The components of our liquidity and descriptions of our cash flows, capital investments, and other matters impacting our liquidity and capital resources can be found under “LIQUIDITY AND CAPITAL RESOURCES” beginning on page 60.

Current wording

Our operations generated $13.9 billion of cash during the first nine months of 2026. Also, we issued $850 million of 5.150 percent Senior Notes due March 10, 2036 during the first nine months of 2026, as described in Note 4 of Condensed Notes to Consolidated Financial Statements. The cash generated by our operations, along with the net proceeds from our debt issuance, was used to make $1.2 billion of capital investments in our business, return $7.3 billion to our stockholders through purchases of common stock for treasury and dividend payments, and repay $526 million of our public debt that matured in the first nine months of 2026. As a result of this and other activity, our cash, cash equivalents, and restricted cash increased by $5.2 billion during the first nine months of 2026 to $10.0 billion as of September 30, 2026. We had $14.7 billion in liquidity as of September 30, 2026. The components of our liquidity and descriptions of our cash flows, capital investments, and other matters impacting our liquidity and capital resources can be found under “LIQUIDITY AND CAPITAL RESOURCES” beginning on page 60.

Previous wording

For the second quarter of 2026, we reported net income attributable to Valero stockholders of $3.7 billion compared to $714 million for the second quarter of 2025. The increase of $3.0 billion was primarily due to an increase in operating income of $4.2 billion, partially offset by an increase in income tax expense of $815 million and an increase in net income attributable to noncontrolling interests of $404 million. The details of our operating income and adjusted operating income, where applicable, by segment and in total are reflected below (in millions). Adjusted operating income excludes the adjustments reflected in the tables in note (c) beginning on page 57.

Current wording

For the third quarter of 2026, we reported net income attributable to Valero stockholders of $6.8 billion compared to $1.1 billion for the third quarter of 2025. The increase of $5.7 billion was primarily due to an increase in operating income of $7.6 billion, partially offset by an increase in income tax expense of $1.7 billion and an increase in net income attributable to noncontrolling interests of $190 million. The details of our operating income and adjusted operating income, where applicable, by segment and in total are reflected below (in millions). Adjusted operating income excludes the adjustments reflected in the tables in note (d) beginning on page 56.

Previous wording

While our operating income increased by $4.2 billion in the second quarter of 2026 compared to the second quarter of 2025, adjusted operating income also increased by $4.2 billion primarily due to the following:

Current wording

While our operating income increased by $7.6 billion in the third quarter of 2026 compared to the third quarter of 2025, adjusted operating income increased by $7.5 billion primarily due to the following:

Previous wording

•Refining segment. Refining segment adjusted operating income increased by $3.2 billion primarily due to higher gasoline and distillate (primarily diesel) margins, partially offset by a decline in sweet crude oil differentials.

Current wording

•Refining segment. Refining segment adjusted operating income increased by $7.1 billion primarily due to higher gasoline and distillate margins, partially offset by a decrease in throughput volumes.

Previous wording

•Renewable Diesel segment. Renewable Diesel segment operating income increased by $796 million primarily due to higher product prices (primarily renewable diesel), partially offset by higher feedstock costs.

Current wording

•Renewable Diesel segment. Renewable Diesel segment operating income increased by $381 million primarily due to higher product prices (primarily renewable diesel), partially offset by higher feedstock costs.

Previous wording

•Ethanol segment. Ethanol segment operating income increased by $334 million primarily due to the recognition of clean fuel production credits in 2026, higher ethanol and corn-related co-product prices, and lower corn prices.

Current wording

•Ethanol segment. Ethanol segment operating income increased by $89 million primarily due to the recognition of clean fuel production credits in 2026 and higher ethanol and corn-related co-product prices, partially offset by higher corn prices.

Previous wording

For the first six months of 2026, we reported net income attributable to Valero stockholders of $5.0 billion compared to $119 million for the first six months of 2025. The increase of $4.9 billion was primarily due to an increase in operating income of $6.8 billion, partially offset by an increase in income tax expense of $1.5 billion and an increase in net income attributable to noncontrolling interests of $520 million. The details of our operating income and adjusted operating income, where applicable, by segment and in total are reflected below (in millions). Adjusted operating income excludes the adjustments reflected in the tables in note (c) beginning on page 57.

Current wording

For the first nine months of 2026, we reported net income attributable to Valero stockholders of $11.8 billion compared to $1.2 billion for the first nine months of 2025. The increase of $10.6 billion was primarily due to an increase in operating income of $14.4 billion, partially offset by an increase in income tax expense of $3.2 billion and an increase in net income attributable to noncontrolling interests of $710 million. The details of our operating income and adjusted operating income, where applicable, by segment and in total are reflected below (in millions). Adjusted operating income excludes the adjustments reflected in the tables in note (d) beginning on page 56.

Previous wording

While our operating income increased by $6.8 billion in the first six months of 2026 compared to the first six months of 2025, adjusted operating income increased by $5.7 billion primarily due to the following:

Current wording

While our operating income increased by $14.4 billion in the first nine months of 2026 compared to the first nine months of 2025, adjusted operating income increased by $13.2 billion primarily due to the following:

Previous wording

•Refining segment. Refining segment adjusted operating income increased by $4.4 billion primarily due to higher gasoline and distillate (primarily diesel) margins and an increase in throughput volumes, partially offset by a decline in sweet crude oil differentials.

Current wording

•Refining segment. Refining segment adjusted operating income increased by $11.5 billion primarily due to higher gasoline and distillate margins, partially offset by lower margins for products other than gasoline and distillate.

Previous wording

•Renewable Diesel segment. Renewable Diesel segment operating income increased by $1.1 billion primarily due to higher product prices (primarily renewable diesel) and an increase in clean fuel production credits recognized on qualifying sales, partially offset by higher feedstock costs.

Current wording

•Renewable Diesel segment. Renewable Diesel segment operating income increased by $1.5 billion primarily due to higher product prices (primarily renewable diesel), partially offset by higher feedstock costs.

Previous wording

•Ethanol segment. Ethanol segment operating income increased by $264 million primarily due to the recognition of clean fuel production credits in 2026, higher ethanol and corn-related co-product prices, and lower corn prices.

Current wording

•Ethanol segment. Ethanol segment operating income increased by $423 million primarily due to the recognition of clean fuel production credits in 2026 and higher ethanol and corn-related co-product prices.

Previous wording

Many uncertainties exist with respect to the supply and demand balances in petroleum-based product markets worldwide. While it is difficult to predict future worldwide economic and geopolitical activity and the resulting impact on product supply and demand, we have noted several factors below that have impacted or may impact our results of operations during the third quarter of 2026.

Current wording

Many uncertainties exist with respect to the supply and demand balances in petroleum-based product markets worldwide. While it is difficult to predict future worldwide economic and geopolitical activity and the resulting impact on product supply and demand, we have noted several factors below that have impacted or may impact our results of operations during the fourth quarter of 2026.

Previous wording

•Although global demand for gasoline, diesel, and jet fuel has been resilient, demand growth has moderated amid market disruptions related to ongoing conflict in the Middle East.

Current wording

•Although global demand for gasoline, diesel, and jet fuel has been resilient, demand growth is expected to remain measured amid market disruptions related to ongoing conflict in the Middle East.

Previous wording

•Ethanol demand is expected to follow typical seasonal patterns.

Current wording

•Ethanol demand is expected to follow typical seasonal patterns, with margins further supported by the recognition of clean fuel production credits.

Previous wording

The following table includes selected financial data for the total company, corporate, and other for the second quarter of 2026 and 2025. The selected financial data is derived from the Financial Highlights by Segment and Total Company tables, unless otherwise noted.

Current wording

The following table includes selected financial data for the total company, corporate, and other for the third quarter of 2026 and 2025. The selected financial data is derived from the Financial Highlights by Segment and Total Company tables, unless otherwise noted.

Previous wording

Revenues increased by $14.6 billion in the second quarter of 2026 compared to the second quarter of 2025 primarily due to increases in product prices for the petroleum-based transportation fuels associated with sales made by our Refining segment. This increase in revenues was partially offset by an increase in cost of sales of $10.4 billion primarily due to increases in crude oil and other feedstock costs. These changes resulted in a $4.2 billion increase in operating income, from $997 million in the second quarter of 2025 to $5.2 billion in the second quarter of 2026.

Current wording

Revenues increased by $13.9 billion in the third quarter of 2026 compared to the third quarter of 2025 primarily due to increases in product prices for the petroleum-based transportation fuels associated with sales made by our Refining segment. This increase in revenues was partially offset by an increase in cost of sales of $6.3 billion primarily due to increases in crude oil and other feedstock costs.

Previous wording

Adjusted operating income, which excludes the adjustments in the table in note (c), also increased by $4.2 billion, from $1.0 billion in the second quarter of 2025 to $5.2 billion in the second quarter of 2026. The primary components of this $4.2 billion increase in adjusted operating income are discussed by segment in the segment analyses that follow.

Current wording

Operating income increased by $7.6 billion in the third quarter of 2026; however, adjusted operating income, which excludes the adjustments in the table in note (d), increased by $7.5 billion, from $1.6 billion in the third quarter of 2025 to $9.1 billion in the third quarter of 2026. The primary components of this $7.5 billion increase in adjusted operating income are discussed by segment in the segment analyses that follow.

Previous wording

Income tax expense increased by $815 million in the second quarter of 2026 compared to the second quarter of 2025 primarily as a result of higher income before income tax expense.

Current wording

Income tax expense increased by $1.7 billion in the third quarter of 2026 compared to the third quarter of 2025 primarily as a result of higher income before income tax expense.

Previous wording

Net income attributable to noncontrolling interests increased by $404 million in the second quarter of 2026 compared to the second quarter of 2025 primarily due to higher earnings associated with DGD, whose operations compose our Renewable Diesel segment. See Note 7 of Condensed Notes to Consolidated Financial Statements regarding our accounting for DGD and the Renewable Diesel segment analysis on page 48.

Current wording

Net income attributable to noncontrolling interests increased by $190 million in the third quarter of 2026 compared to the third quarter of 2025 primarily due to higher earnings associated with DGD, whose operations compose our Renewable Diesel segment. See Note 7 of Condensed Notes to Consolidated Financial Statements regarding our accounting for DGD and the Renewable Diesel segment analysis on page 48.

Previous wording

The following table includes selected financial and operating data of our Refining segment for the second quarter of 2026 and 2025. The selected financial data is derived from the Financial Highlights by Segment and Total Company tables, unless otherwise noted.

Current wording

The following table includes selected financial and operating data of our Refining segment for the third quarter of 2026 and 2025. The selected financial data is derived from the Financial Highlights by Segment and Total Company tables, unless otherwise noted.

Previous wording

Refining segment margin is primarily affected by the prices for the petroleum-based transportation fuels that we sell and the cost of crude oil and other feedstocks that we process. The table on page 45 reflects market reference prices and differentials that we believe impacted our Refining segment margin in the second quarter of 2026 compared to the second quarter of 2025.

Current wording

Refining segment margin is primarily affected by the prices for the petroleum-based transportation fuels that we sell and the cost of crude oil and other feedstocks that we process. The table on page 45 reflects market reference prices and differentials that we believe impacted our Refining segment margin in the third quarter of 2026 compared to the third quarter of 2025.

Previous wording

•An increase in gasoline margins had a favorable impact of approximately $980 million.

Current wording

•An increase in gasoline margins had a favorable impact of approximately $2.3 billion.

Previous wording

•An increase in throughput volumes of 57,000 barrels per day had a favorable impact of approximately $200 million. During the first six months of 2026, we idled the processing units and ceased operation of the fuel production units at our Benicia Refinery, which was completed by the end of April 2026. In addition, in March 2026, an incident at our Port Arthur Refinery prompted a full shutdown of the refinery followed by a phased restart of the processing units by the end of the second quarter of 2026. These events, which are discussed in “OVERVIEW AND OUTLOOK—Overview—Business Operations Update” beginning on page 39 and in Notes 2 and 5 of Condensed Notes to Consolidated Financial Statements, resulted in lower volumes at our

Current wording

•A decrease in throughput volumes of 115,000 barrels per day had an unfavorable impact of approximately $420 million. As discussed in Note 2 of Condensed Notes to Consolidated Financial Statements, we idled the processing units and ceased operation of the fuel production units at our Benicia Refinery by the end of April 2026. As a result of these actions, throughput volumes were lower in the third quarter of 2026 compared to the third quarter of 2025.

Previous wording

The following table includes selected financial and operating data of our Renewable Diesel segment for the second quarter of 2026 and 2025. The selected financial data is derived from the Financial Highlights by Segment and Total Company tables, unless otherwise noted.

Current wording

The following table includes selected financial and operating data of our Renewable Diesel segment for the third quarter of 2026 and 2025. The selected financial data is derived from the Financial Highlights by Segment and Total Company tables, unless otherwise noted.

Previous wording

Renewable Diesel segment operating income increased by $796 million in the second quarter of 2026 compared to the second quarter of 2025 primarily due to an increase in Renewable Diesel margin of $825 million.

Current wording

Renewable Diesel segment operating income increased by $381 million in the third quarter of 2026 compared to the third quarter of 2025 primarily due to an increase in Renewable Diesel margin of $384 million.

Previous wording

Renewable Diesel segment margin is primarily affected by the prices for the renewable fuels that we sell, the recognition of clean fuel production credits on qualifying sales, and the cost of the feedstocks that we process. The table on page 46 reflects market reference prices that we believe impacted our Renewable Diesel segment margin in the second quarter of 2026 compared to the second quarter of 2025.

Current wording

Renewable Diesel segment margin is primarily affected by the prices for the renewable fuels that we sell, the recognition of clean fuel production credits on qualifying sales, and the cost of the feedstocks that we process. The table on page 46 reflects market reference prices that we believe impacted our Renewable Diesel segment margin in the third quarter of 2026 compared to the third quarter of 2025.

Previous wording

•An increase in product prices, primarily renewable diesel, had a favorable impact of approximately $1.0 billion.

Current wording

•An increase in product prices, primarily renewable diesel, had a favorable impact of approximately $1.2 billion.

Previous wording

•An increase in the cost of the feedstocks that we process had an unfavorable impact of approximately $200 million.

Current wording

•An increase in the cost of the feedstocks that we process had an unfavorable impact of approximately $750 million.

Previous wording

The following table includes selected financial and operating data of our Ethanol segment for the second quarter of 2026 and 2025. The selected financial data is derived from the Financial Highlights by Segment and Total Company tables, unless otherwise noted.

Current wording

The following table includes selected financial and operating data of our Ethanol segment for the third quarter of 2026 and 2025. The selected financial data is derived from the Financial Highlights by Segment and Total Company tables, unless otherwise noted.

Previous wording

Ethanol segment margin is primarily affected by prices for the ethanol and corn-related co-products that we sell, the recognition of clean fuel production credits on qualifying sales, and the cost of corn that we process. The table on page 46 reflects market reference prices that we believe impacted our Ethanol segment margin in the second quarter of 2026 compared to the second quarter of 2025.

Current wording

Ethanol segment margin is primarily affected by prices for the ethanol and corn-related co-products that we sell, the recognition of clean fuel production credits on qualifying sales, and the cost of corn that we process. The table on page 46 reflects market reference prices that we believe impacted our Ethanol segment margin in the third quarter of 2026 compared to the third quarter of 2025.