Phillips 66 (PSX): Results of Operations and Financial Condition
Phillips 66 (PSX) filed an SEC Form 8-K — Results of Operations and Financial Condition. Exhibit 99.1 • Reported second-quarter earnings of $3.8 billion or $9.55 per share; adjusted earnings of $3.8 billion or $9.41 per share • Decreased total debt by $6.6 billion to $20.6 billion; net debt reduced to $16.5 billion • Achieved record NGL fractionation volumes and LPG
How this was made
The 30-second read
Why it matters
Traders can use the segment and adjusted reconciliation tables to reassess earnings power and margin sensitivity across midstream, refining, chemicals, marketing, and renewable fuels for near-term trading.
Market read
This is a primary earnings-related disclosure with detailed segment and adjusted metrics, useful for updating models and positioning, but the excerpt lacks explicit guidance or consensus deltas.
What to watch
The excerpt highlights large swings in refining and corporate/other items (including impairments and legal accruals), which may dominate GAAP results even if underlying adjusted EBITDA is steadier.
Phillips 66 reported 2nd Qtr 2026 net income attributable to Phillips 66 of $3,847 million and adjusted net income attributable to Phillips 66 of $3,788 million.
Reported and adjusted earnings, refining income, midstream income and operating cash flow were materially higher than the respective 2nd Qtr 2025 figures presented in the supplemental data.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Sales and other operating revenuesGAAP | $51,004 million | – | – |
| Equity in earnings of affiliatesGAAP | $635 million | – | – |
| Net gain (loss) on dispositionsGAAP | $117 million | – | – |
| Other incomeGAAP | $288 million | – | – |
| Total Revenues and Other IncomeGAAP | $52,044 million | – | – |
| Purchased crude oil and productsGAAP | $43,664 million | – | – |
| Operating expensesGAAP | $1,810 million | – | – |
| Selling, general and administrative expensesGAAP | $538 million | – | – |
| Depreciation and amortizationGAAP | $585 million | – | – |
| ImpairmentsGAAP | $9 million | – | – |
| Taxes other than income taxesGAAP | $127 million | – | – |
| Accretion on discounted liabilitiesGAAP | $13 million | – | – |
| Interest and debt expenseGAAP | $314 million | – | – |
| Foreign currency transaction (gains) lossesGAAP | $13 million | – | – |
| Total Costs and ExpensesGAAP | $47,073 million | – | – |
| Income before income taxesGAAP | $4,971 million | – | – |
| Income tax expenseGAAP | $1,092 million | – | – |
| Net IncomeGAAP | $3,879 million | – | – |
| Net Income Attributable to Phillips 66GAAP | $3,847 million | – | – |
| Net Income Attributable to Phillips 66 Per Share of Common Stock, BasicGAAP | $9.59 per share | – | – |
| Net Income Attributable to Phillips 66 Per Share of Common Stock, DilutedGAAP | $9.55 per share | – | – |
| Effective tax rateGAAP | 22.0 % | – | – |
| Adjusted effective tax ratenon-GAAP | 22.4 % | – | – |
| Adjusted income (loss) before income taxesnon-GAAP | $4,926 million | – | – |
| Adjusted Net Income (Loss) Attributable to Phillips 66non-GAAP | $3,788 million | – | – |
| Adjusted Net Income (Loss) Attributable to Phillips 66 Per Share of Common Stock, Dilutednon-GAAP | $9.41 per share | – | – |
| Adjusted EBITDAnon-GAAP | $5,891 million | – | – |
| Midstream income before income taxesGAAP | $785 million | – | – |
| Chemicals income before income taxesGAAP | $404 million | – | – |
| Refining income before income taxesGAAP | $3,062 million | – | – |
| Marketing and Specialties income (loss) before income taxesGAAP | $583 million | – | – |
| Renewable Fuels income (loss) before income taxesGAAP | $544 million | – | – |
| Corporate and Other income (loss) before income taxesGAAP | $(407) million | – | – |
| Total Midstream Adjusted EBITDAnon-GAAP | $1,046 million | – | – |
| Chemicals Adjusted EBITDAnon-GAAP | $528 million | – | – |
| Refining Adjusted EBITDAnon-GAAP | $3,307 million | – | – |
| Marketing and Specialties Adjusted EBITDAnon-GAAP | $580 million | – | – |
| Renewable Fuels Adjusted EBITDAnon-GAAP | $568 million | – | – |
| Corporate and Other Adjusted EBITDAnon-GAAP | $(138) million | – | – |
Capital returns
- Repurchase of common stock: $(379) million in 2nd Qtr 2026.
- Dividends paid on common stock: $(508) million in 2nd Qtr 2026.
- Repurchase of common stock: $(648) million YTD 2026.
- Dividends paid on common stock: $(1,017) million YTD 2026.
What drove it
- Refining income before income taxes was $3,062 million, compared with $359 million in 2nd Qtr 2025.
- Midstream income before income taxes was $785 million, and Total Midstream Adjusted EBITDA was $1,046 million.
- Renewable Fuels income before income taxes was $544 million, compared with a $(133) million loss in 2nd Qtr 2025.
- Marketing and Specialties included a $110 million net gain on asset dispositions and a $(41) million legal accrual related to ongoing litigation with Propel Fuels, Inc.
Concerns
- Interest and debt expense was $314 million, compared with $264 million in 2nd Qtr 2025.
- Operating expenses were $1,810 million, compared with $1,440 million in 2nd Qtr 2025.
- 2nd Qtr 2026 financing cash flows included debt repayment of $(3,936) million and issuance of debt of $(2,740) million.
- Corporate and Other reported an income loss before income taxes of $(407) million.
What to watch
- Refining income before income taxes and Adjusted EBITDA.
- Sustainability of the $544 million Renewable Fuels income before income taxes.
- Midstream Transportation and NGL results, which comprised Total Midstream Adjusted EBITDA of $1,046 million.
- Operating cash flow after the $(2,264) million use in 1st Qtr 2026 and $7,259 million provided in 2nd Qtr 2026.
- Common-stock repurchases, dividends, and debt issuance and repayment activity.
Balance sheet and cash flow
- Net Cash Provided by (Used in) Operating Activities: $7,259 million in 2nd Qtr 2026; $(2,264) million in 1st Qtr 2026; $845 million in 2nd Qtr 2025.
- Capital expenditures and investments: $(726) million in 2nd Qtr 2026; $(582) million in 1st Qtr 2026; $(587) million in 2nd Qtr 2025.
- Acquisitions, net of cash acquired: $(113) million in 2nd Qtr 2026.
- Proceeds from asset dispositions: $64 million in 2nd Qtr 2026.
- Issuance of debt: $(2,740) million in 2nd Qtr 2026.
- Repayment of debt: $(3,936) million in 2nd Qtr 2026.
Analysis
Phillips 66 reported a substantially stronger 2nd Qtr 2026 than the comparative period presented. Total Revenues and Other Income were $52,044 million, versus $33,522 million in 2nd Qtr 2025, while Net Income Attributable to Phillips 66 was $3,847 million, versus $877 million. Diluted GAAP earnings per share were $9.55, compared with $2.15. Adjusted Net Income Attributable to Phillips 66 was $3,788 million, and adjusted diluted earnings per share were $9.41.
Refining was the principal reported earnings contributor. Refining income before income taxes reached $3,062 million, compared with $359 million in 2nd Qtr 2025, and Refining Adjusted EBITDA was $3,307 million, compared with $867 million. Midstream income before income taxes was $785 million and Total Midstream Adjusted EBITDA was $1,046 million. Chemicals income before income taxes was $404 million, while Renewable Fuels moved to $544 million of income before income taxes from a $(133) million loss in the comparative quarter.
The gap between GAAP and adjusted results was limited in the quarter. Total special items were $45 million pre-tax and $59 million after-tax. Marketing and Specialties recorded a $110 million net gain on asset dispositions, partly offset by a $(41) million legal accrual. The disposition gain related to post-closing adjustments from the December 2025 sale of 65% of Phillips 66's interest in its Germany and Austria retail marketing business.
Cash flow improved materially in the reported quarter. Net Cash Provided by Operating Activities was $7,259 million after $(2,264) million used in 1st Qtr 2026. Capital expenditures and investments were $(726) million. The company repurchased $379 million of common stock and paid $508 million of common-stock dividends, while financing activity included $(2,740) million of debt issuance and $(3,936) million of debt repayment.
Costs rose alongside revenue, with purchased crude oil and products at $43,664 million and Total Costs and Expenses at $47,073 million. Operating expenses were $1,810 million and interest and debt expense was $314 million. The effective tax rate was 22.0 %, compared with 15.9 % in 1st Qtr 2026, and the adjusted effective tax rate was 22.4 %. No forward outlook was included in the provided filing text.
Not in the filing
stated, not guessed- Forward guidance for revenue, gross margin, operating expenses, tax rate, capital spending, volumes, or other metrics was not provided in the supplied text.
- Previous-period outlook was not provided, so guidance comparisons are unavailable.
- Gross profit and gross margin were not reported.
- Operating income was not reported.
- Free cash flow was not reported.
- Cash balance, total debt balance, and net debt were not provided in the supplied text.
- Segment revenue was not reported. The supplemental data reports segment income before income taxes and Adjusted EBITDA rather than revenue.
- Management commentary and named executive quotes were not provided in the supplied text.
- Percentage changes for the reported metrics were not printed.
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.
Background
The SEC 8-K (Item 2.02) attaches Phillips 66 earnings release supplemental data, including consolidated income statement, segment reconciliations, and adjusted EBITDA by segment.
Ticker impact
Phillips 66 filed an 8-K with earnings release supplemental data showing 2026 YTD net income attributable to PSX of $4,403 million and segment results.
Likely modest, with direction depending on how traders interpret segment swings (notably refining and chemicals) versus expectations.
This is a primary SEC filing with detailed income statement and segment reconciliations, but the excerpt does not include consensus comparisons or management guidance, limiting conviction on directional impact.
Market effects
Segment profitability detail (midstream, refining, chemicals, renewable fuels) can affect sentiment across downstream and midstream peers via read-across on margins and volumes.
Refining segment sub-regions (Atlantic Basin/Europe, Gulf Coast, Central Corridor, West Coast) can influence regional margin expectations for North American and export-linked refining.
Refining and chemicals earnings sensitivity to global product spreads means the release can inform broader energy complex positioning, though no macro drivers are specified in the excerpt.
Counterpoint
Net income and adjusted measures can be distorted by impairments, legal accruals, and tax impacts; traders may discount the headline profitability and focus on adjusted EBITDA trends.
Key entities
- issuerPhillips 66
Subject of the SEC 8-K filing with earnings release supplemental data (PSX).
- filingSEC Form 8-K
Regulatory disclosure vehicle for reporting results of operations and financial condition.
