second quarter 2026
Filed Jul 22, 2026Achieves Record Second Quarter Net Income and Adjusted EBITDA; EPS 22% greater than 2025; Adjusted EPS up 32%
Second-quarter net income attributable to KMI, Adjusted EBITDA, EPS, and Adjusted EPS all increased year over year, while management raised its full-year expectations relative to budget for Adjusted EBITDA and Adjusted EPS.
Key metrics
shortened, hover for the filing’s print| Metric | Value | q/q | y/y |
|---|---|---|---|
| RevenueGAAP | $4.48B | – | – |
| Operating incomeGAAP | $1.35B | – | – |
| Net incomeGAAP | $894M | – | – |
| Net income attributable to Kinder Morgan, Inc.GAAP | $867M | – | 21% |
| Earnings per share, basic and dilutedGAAP | $0.39 | – | 22% |
| Adjusted Net Income Attributable to Kinder Morgan, Inc.non-GAAP | $821M | – | 33% |
| Adjusted EPSnon-GAAP | $0.37 | – | 32% |
| Adjusted EBITDAnon-GAAP | $2.20B | – | 12% |
| Cash flow from operationsGAAP | $1.96B | – | – |
| Capital expendituresGAAP | −$982M | – | – |
| FCFnon-GAAP | $978M | – | – |
| Dividends paidother | −$665M | – | – |
| FCF after dividendsnon-GAAP | $313M | – | – |
| Natural Gas Pipelines Adjusted Segment EBDAnon-GAAP | $1.46B | – | – |
| Products Pipelines Adjusted Segment EBDAnon-GAAP | $339M | – | – |
| Terminals Adjusted Segment EBDAnon-GAAP | $309M | – | – |
| CO2 Adjusted Segment EBDAnon-GAAP | $207M | – | – |
| Cash and cash equivalentsGAAP | $89M | – | – |
| Short-term debtGAAP | $2.44B | – | – |
| Long-term debtGAAP | $29.70B | – | – |
| Net Debtnon-GAAP | $32.03B | – | – |
| Net Debt-to-Adjusted EBITDAnon-GAAP | 3.6 | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Natural Gas PipelinesFinancial performance was up on higher contributions from the Texas Intrastate system and gathering assets. Natural gas transport volumes were up 7%, primarily due to LNG deliveries on TGP, increased Texas Intrastate demand, increased exports to Mexico, and higher Arizona power-generation demand on El Paso Natural Gas Pipeline. Gathering volumes were up 26%. | Not reported | – | – |
| Products PipelinesContributions were up primarily due to higher commodity prices. Total refined products volumes were down 5% due to temporary West Coast supply disruptions and a higher commodity price environment, while crude and condensate volumes were down 16%, largely due to the conversion of Double H Pipeline to natural gas liquids service. | Not reported | – | – |
| TerminalsEarnings were up, led by liquids terminals benefiting from higher rates and ancillary fees at Houston Ship Channel hub facilities and favorable commodity pricing. Jones Act tanker fleet earnings increased on higher average charter rates. Bulk terminals contributions declined despite higher volumes owing to one-time events in the prior-year period. | Not reported | – | – |
| CO2Earnings were up primarily due to higher commodity prices and volumes. SACROC volumes were up 15% compared to the prior-year period. | Not reported | – | – |
2026 outlook
- NoteBudgeted net income attributable to KMI of $3.1 billion
- NoteAdjusted EPS of $1.36
- NoteDeclared dividends of $1.19 per share
- NoteAdjusted EBITDA of $8.6 billion
- NoteYear-end Net Debt-to-Adjusted EBITDA of 3.8 times
- NoteCurrently expects to be more than 5% favorable to budget on an Adjusted EBITDA basis for the year
- NoteCurrently expects to be more than 12% favorable to budget on Adjusted EPS for the year
- NoteExpects to end the year with an improved Net Debt-to-Adjusted EBITDA of 3.6 times
Capital returns
- Cash dividend of $0.2975 per share for the second quarter ($1.19 annualized)
- Dividend payable on August 17, 2026, to stockholders of record as of the close of business on August 3, 2026
- Dividend is a 2% increase over the second quarter of 2025
- Declared dividends per share of $0.2975, compared with $0.2925 in the second quarter of 2025
- Dividends paid of $(665) million, compared with $(654) million in the second quarter of 2025
What drove it
- Natural gas transport volumes were 47,886 BBtu/d, compared with 44,818 BBtu/d in the second quarter of 2025.
- Natural gas gathering volumes were 4,637 BBtu/d, compared with 3,692 BBtu/d in the second quarter of 2025.
- SACROC oil production was 21.11 MBbl/d, compared with 18.42 MBbl/d in the second quarter of 2025.
- Total oil production, net, was 28.04 MBbl/d, compared with 25.52 MBbl/d in the second quarter of 2025.
- Realized weighted average oil price was $73.78 per Bbl, compared with $67.60 per Bbl in the second quarter of 2025.
- Approximately $660 million (KM-share) in expansion projects was placed into service during the quarter.
- The project backlog was $9.6 billion at the end of the second quarter of 2026, down $500 million from the first quarter of 2026.
- Natural gas projects account for approximately 92% of the project backlog, and more than 60% of the backlog is associated with projects supporting power generation and local distribution company demand.
- The remaining $8.5 billion of projects in the backlog is expected, when realized, to generate an aggregate first-full-year Project EBITDA multiple of approximately 5.6 times.
Concerns
- Total refined product volumes were 1,623 MBbl/d, compared with 1,710 MBbl/d in the second quarter of 2025.
- Crude and condensate volumes were 421 MBbl/d, compared with 503 MBbl/d in the second quarter of 2025.
- Liquids utilization was 93.0%, compared with 94.4% in the second quarter of 2025.
- FCF declined to $978 million from $1,002 million as capital expenditures increased to $(982) million from $(647) million.
- Project in-service dates assume timely receipt and continued effectiveness of all necessary permits and approvals.
- The Western Gateway Pipeline remains subject to definitive transportation service agreements, joint venture agreements, and respective board approvals.
What to watch
- Whether KMI delivers more than 5% favorable performance to budget on Adjusted EBITDA and more than 12% favorable performance to budget on Adjusted EPS for 2026.
- Progress toward the expected year-end Net Debt-to-Adjusted EBITDA ratio of 3.6 times.
- FERC certificate orders for the approximately $3.5 billion SSE4 project and the approximately $1.7 billion MSX project, which FERC had previously indicated it expects to issue by the end of July 2026.
- Execution and permitting of SSE4, MSX, the South Texas Enhancement Project, and NGPL's Amarillo Expansion project.
- The conversion of backlog into projects and the impact of continued natural gas demand tied to LNG exports, power generation, local distribution company demand, and industrial expansion.
Balance sheet and cash flow
- Cash and cash equivalents were $89 million at June 30, 2026, compared with $63 million at December 31, 2025.
- Short-term debt was $2,443 million at June 30, 2026, compared with $1,226 million at December 31, 2025.
- Long-term debt was $29,701 million at June 30, 2026, compared with $30,597 million at December 31, 2025.
- Net Debt was $32,027 million at June 30, 2026, compared with $31,716 million at December 31, 2025.
- Last-twelve-month Adjusted EBITDA was $9,000 million at June 30, 2026, compared with $8,391 million at December 31, 2025.
- Net Debt-to-Adjusted EBITDA was 3.6 at June 30, 2026, compared with 3.8 at December 31, 2025.
- Second-quarter cash flow from operations was $1,960 million, compared with $1,649 million in the second quarter of 2025.
- Second-quarter capital expenditures were $(982) million, compared with $(647) million in the second quarter of 2025.
- Second-quarter FCF was $978 million, compared with $1,002 million in the second quarter of 2025.
- Second-quarter FCF after dividends was $313 million, compared with $348 million in the second quarter of 2025.
Analysis
Kinder Morgan reported a record second quarter for net income attributable to KMI and Adjusted EBITDA. Revenue was $4,477 million versus $4,042 million in the second quarter of 2025, while operating income was $1,346 million versus $1,152 million. Net income attributable to KMI increased to $867 million from $715 million, GAAP EPS rose to $0.39 from $0.32, and Adjusted EPS increased to $0.37 from $0.28. Adjusted EBITDA rose 12% to $2,199 million from $1,972 million.
The Natural Gas Pipelines business was the largest reported segment contributor, with Adjusted Segment EBDA of $1,461 million versus $1,347 million. Management cited higher Texas Intrastate and gathering contributions, while natural gas transport volumes increased to 47,886 BBtu/d from 44,818 BBtu/d and gathering volumes increased to 4,637 BBtu/d from 3,692 BBtu/d. Products Pipelines, Terminals, and CO2 Adjusted Segment EBDA also increased year over year to $339 million, $309 million, and $207 million, respectively. Products pipeline volumes weakened, however, with total refined products volumes at 1,623 MBbl/d versus 1,710 MBbl/d and crude and condensate volumes at 421 MBbl/d versus 503 MBbl/d.
Cash generation remained substantial but capital spending increased. Cash flow from operations was $1,960 million versus $1,649 million, while capital expenditures rose to $(982) million from $(647) million. Consequently, FCF was $978 million compared with $1,002 million, and FCF after dividends was $313 million compared with $348 million. KMI placed approximately $660 million (KM-share) of expansion projects into service and ended the quarter with a $9.6 billion project backlog, down $500 million from the first quarter of 2026.
The balance sheet showed Net Debt of $32,027 million, compared with $31,716 million at December 31, 2025, while last-twelve-month Adjusted EBITDA rose to $9,000 million from $8,391 million. This reduced Net Debt-to-Adjusted EBITDA to 3.6 from 3.8. The board approved a $0.2975 per-share quarterly dividend, a 2% increase from the second quarter of 2025. For 2026, KMI retained budgeted net income attributable to KMI of $3.1 billion, Adjusted EPS of $1.36, declared dividends of $1.19 per share, and Adjusted EBITDA of $8.6 billion, while stating that it expects to be more than 5% favorable to budget on Adjusted EBITDA and more than 12% favorable on Adjusted EPS.
Management, verbatim
Our fee-based business model, strategically located network of assets, and portfolio of long-term contracts with financially strong customers continue to support stable and predictable cash flows.
Richard D. Kinder, Executive Chairman
In the second quarter, we continued to internally fund high-quality capital projects while generating cash flow from operations of $2 billion and free cash flow (FCF), which is after capital expenditures, of $1 billion.
Kim Dang, Chief Executive Officer
The Natural Gas Pipelines business segment’s financial performance was up in the second quarter of 2026 relative to the second quarter of 2025, on higher contributions from our Texas Intrastate system and our gathering assets.
Dax Sanders, President
Not in the filing
stated, not guessed- Gross margin
- Quarterly gross profit
- Segment revenue by Natural Gas Pipelines, Products Pipelines, Terminals, and CO2
- Prior-quarter comparisons for reported quarterly financial metrics
- Revenue guidance
- Gross margin guidance
- Operating expense guidance
- Tax-rate guidance
- Share repurchases
- Previous-release outlook for comparison with actual results
AlphAI 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.