Western Midstream Q3 adjusted EBITDA rises 12%
Natural-gas throughput set records at 5.9 Bcf/d partnership-wide and 2.6 Bcf/d in the Delaware Basin.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Form Type
8-K
Rhea-AI Filing Summary
Western Midstream Partners, LP (WES) reported third-quarter 2026 limited partners’ net income of $324.8 million and Adjusted EBITDA of $708.3 million, up 12% from the prior-year period. Distributable Cash Flow was $512.3 million, cash provided by operating activities was $567.5 million, and Free Cash Flow was $244.2 million. Free Cash Flow after distributions was negative $148.5 million, attributed to organic growth capital expenditures. The $0.930 per-unit distribution is consistent with the prior quarter and is payable November 13, 2026.
WES reaffirmed 2026 guidance of $2.750 billion to $2.950 billion in Adjusted EBITDA, $2.050 billion to $2.250 billion in Distributable Cash Flow, and $1.100 billion to $1.300 billion in Free Cash Flow. Management expects full-year Adjusted EBITDA above the guidance midpoint and total capital expenditures slightly above the $850.0 million to $1.0 billion guidance range, citing accelerating producer activity and its investment in Solitude. WES acquired a 7.5% equity interest in the Solitude Pipeline System. Management expects 2027 capital expenditures to be relatively in line with 2026, with approximately 80% directed to the Delaware Basin.
1 point · 0 major0 major · 0 points
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointAdjusted EBITDA rose 12% year over year.
Negative
- None.
Filing Explained
WES reports record third-quarter natural-gas throughput of 5,936 MMcf/d in total; 5,743 MMcf/d was attributable to WES after excluding noncontrolling interests, so the total includes throughput beyond WES’s attributable amount.
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, or exhibit attachments filed with this report.
Key Figures
Limited partners’ net income: $324.8 million
Adjusted EBITDA: $708.3 million
Adjusted EBITDA increase: 12%
+5 more
8 metrics
Limited partners’ net income
$324.8 million
Third quarter 2026
Adjusted EBITDA
$708.3 million
Third quarter 2026
Adjusted EBITDA increase
12%
Compared with the prior-year period
Distributable Cash Flow
$512.3 million
Third quarter 2026
Cash provided by operating activities
$567.5 million
Third quarter 2026
Free Cash Flow
$244.2 million
Third quarter 2026
Free Cash Flow after distributions
Negative $148.5 million
Third quarter 2026; attributed to organic growth capital expenditures
Distribution per unit
$0.930 per unit
Third quarter 2026 distribution, payable November 13, 2026
Key Terms
Adjusted EBITDA, Distributable Cash Flow, Free Cash Flow, noncontrolling interests
4 terms
Adjusted EBITDA financial
"third-quarter 2026 Adjusted EBITDA totaling $708.3 million"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
Distributable Cash Flow financial
"third-quarter Distributable Cash Flow of $512.3 million"
Distributable cash flow is the amount of money a business generates from its operations that management considers available to pay dividends, buy back shares, or make other distributions to owners after setting aside what’s needed to keep the business running and meet routine obligations. Investors care because it shows how much real cash can be returned to them—like a household’s leftover paycheck after paying rent and groceries—and helps judge whether payouts are sustainable and backed by operations rather than accounting entries.
Free Cash Flow financial
"third-quarter Free Cash Flow totaled $244.2 million"
Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.
noncontrolling interests financial
"Net income attributable to noncontrolling interests"
The portion of a subsidiary’s equity and profits that belongs to outside owners rather than the parent company; when a parent reports consolidated results it includes the whole subsidiary but shows the noncontrolling slice separately. Think of a company’s subsidiary as a pie where the parent owns most slices but some are held by other investors — noncontrolling interests tell you how much of the pie and its future earnings don’t belong to the parent, which affects how much profit and net assets are truly attributable to the parent’s shareholders.
Earnings Snapshot
Limited partners’ net income: $324.8 million · Guidance included
Third quarter 2026
Limited partners’ net income
$324.8 million
Adjusted EBITDA
$708.3 million
12% increase compared with the prior-year period
Distributable Cash Flow
$512.3 million
Cash provided by operating activities
$567.5 million
Free Cash Flow
$244.2 million
Guidance
WES reaffirmed 2026 guidance of $2.750 billion to $2.950 billion in Adjusted EBITDA, $2.050 billion to $2.250 billion in Distributable Cash Flow, and $1.100 billion to $1.300 billion in Free Cash Flow. Total capital expenditures are expected to be slightly above the $850.0 million to $1.0 billion guidance range.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What capacity will the Solitude Pipeline System provide for WES?
The Solitude Pipeline System is expected to provide initial takeaway capacity of up to 2.25 Bcf/d in late 2029, followed by an incremental 2.25 Bcf/d in 2030. It consists of two 48-inch natural-gas pipelines running from the Permian Basin to Katy, Texas, and is operated by WhiteWater.
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): November 4, 2026
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
(Address of principal executive office) (Zip Code)
(346 ) 786-5000
(Registrant’s telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading symbol | Name of exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On November 4, 2026, Western Midstream Partners, LP issued a press release announcing third-quarter 2026 results. The Partnership also simultaneously made the slide presentation for tomorrow’s earnings call and the updated investor slide presentation available on the Western Midstream website, www.westernmidstream.com. The earnings press release is included in this report as Exhibit 99.1.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| 99.1 | Press release dated November 4, 2026, announcing third-quarter 2026 results. | |||||||
| 104 | Cover Page Interactive Data File. | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| WESTERN MIDSTREAM PARTNERS, LP | ||||||||||||||
| By: | Western Midstream Holdings, LLC, its general partner | |||||||||||||
| Dated: | November 4, 2026 | By: | /s/ Kristen S. Shults | |||||||||||
| Kristen S. Shults Senior Vice President and Chief Financial Officer | ||||||||||||||
EXHIBIT 99.1
Western Midstream Announces Third-Quarter 2026 Results
•Reported third-quarter 2026 Net income attributable to limited partners of $324.8 million, generating quarterly Adjusted EBITDA(1) of $708.3 million, which represents a 12-percent increase compared to the prior-year period, and third-quarter Distributable Cash Flow(1) of $512.3 million.
•Reported third-quarter 2026 Cash flows provided by operating activities of $567.5 million, generating third-quarter Free Cash Flow(1) of $244.2 million.
•Announced a third-quarter distribution of $0.930 per unit, which is consistent with the prior quarter’s distribution, and reflects a distribution of $3.72 per unit on an annualized basis.
•Reaffirming 2026 Adjusted EBITDA(2), Distributable Cash Flow(2), and Free Cash Flow(2) guidance ranges of $2.750 billion to $2.950 billion, $2.050 billion to $2.250 billion, and $1.100 billion to $1.300 billion, respectively.
•Expect to be slightly above the high end of the 2026 total capital expenditures(3) guidance range of $850.0 million to $1.0 billion, driven by capital needs related to producers’ accelerating activity and WES’s investment in the Solitude Pipeline System.
HOUSTON—(PR NEWSWIRE)—November 4, 2026 – Today Western Midstream Partners, LP (NYSE: WES) (“WES” or the “Partnership”) announced third-quarter 2026 financial and operating results. Net income (loss) attributable to limited partners for the third quarter of 2026 totaled $324.8 million, or $0.78 per common unit (diluted), with third-quarter 2026 Adjusted EBITDA(1) totaling $708.3 million and Distributable Cash Flow(1) totaling $512.3 million. Third-quarter 2026 Cash flows provided by operating activities totaled $567.5 million and third-quarter 2026 Free Cash Flow(1) totaled $244.2 million. Third-quarter 2026 capital expenditures(3) totaled $303.4 million.
RECENT HIGHLIGHTS
•Gathered record natural-gas throughput of 5.9 Bcf/d, representing an 8-percent sequential-quarter increase.
•Achieved record natural-gas throughput in the Delaware Basin of 2.6 Bcf/d, representing a 20-percent sequential-quarter increase, mostly driven by the acquisition of Brazos Delaware II, LLC (“Brazos Delaware”) in June 2026.
•Gathered record produced-water throughput in the Delaware Basin of 3,047 MBbls/d, representing a 2-percent sequential-quarter increase.
•As previously announced, WES acquired a 7.5-percent equity interest in the Solitude Pipeline System joint venture (“Solitude”) operated by WhiteWater, consisting of two 48-inch natural-gas pipelines running from the Permian Basin to Katy, Texas, providing initial takeaway capacity of up to 2.25 Bcf/d in late 2029 and an incremental 2.25 Bcf/d in 2030.
On November 13, 2026, WES will pay its third-quarter 2026 per-unit distribution of $0.930, or $3.72 on an annualized basis, which is consistent with the prior quarter’s distribution. Third-quarter 2026 Free Cash Flow(1) after distributions totaled negative $148.5 million as a result of organic growth capital expenditures.
Third-quarter 2026 natural-gas throughput(4) averaged 5.7 Bcf/d, representing a 7-percent sequential-quarter increase. Third-quarter 2026 crude-oil and NGLs throughput(4) averaged 526 MBbls/d, a slight sequential-quarter increase. Third-quarter 2026 produced-water throughput(4) averaged 2,992 MBbls/d, representing a 2-percent sequential-quarter increase.
“WES achieved record natural-gas throughput, partnership-wide and in the Delaware Basin, driven by increased throughput from our legacy assets and a full quarter of contribution from the Brazos Delaware acquisition that closed in June,” commented Oscar K. Brown, President and Chief Executive Officer of WES. “The Brazos integration is progressing as expected, and we anticipate tying those assets into our West Texas Complex by mid-December, enabling us to reduce offloads and generate more value for WES unitholders.”
2
“With a greater number of wells expected to come online relative to the third quarter, we expect strong fourth-quarter results and anticipate full-year Adjusted EBITDA above the midpoint of our guidance range of $2.750 billion to $2.950 billion. This represents an increase of more than $250.0 million relative to the $2.600 billion midpoint of our original Adjusted EBITDA guidance range announced in February, or more than $150.0 million above the midpoint excluding the Brazos acquisition. This outlook follows a modest sequential decline in third-quarter Adjusted EBITDA primarily due to lower crude-oil and NGLs pricing, decreased throughput in the DJ Basin, and slightly higher operation and maintenance expense, which is typical in the third quarter. We also expect 2026 capital expenditures to be slightly above the high end of our $850.0 million to $1.0 billion guidance range, reflecting our investment in Solitude and accelerating producer activity levels.”
“We expect this momentum to carry into 2027, with incremental customer activity, a full year of contribution from Brazos, the start-up of the Pathfinder pipeline, North Loving II coming online, and new gathering and processing agreements in the Powder River Basin positioning us for throughput growth across all three product lines again next year. We expect 2027 capital expenditures to be relatively in line with 2026, with approximately 80-percent directed to the Delaware Basin, our largest growth driver, which includes our investment in the Solitude pipeline and completion of North Loving II. The vast majority of the remaining capital expenditures will be directed to the Powder River Basin to support those new agreements. Our solid liquidity position and investment grade balance sheet position us to fund these growth opportunities, return substantial capital to unitholders, and continue to pursue strategic acquisitions.”
CONFERENCE CALL TOMORROW AT 9:00 A.M. CT
WES will host a conference call on Thursday, November 5, 2026, at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) to discuss its third-quarter 2026 results. To access the live audio webcast of the conference call, please visit the investor relations section of the Partnership’s website at www.westernmidstream.com. A small number of phone lines are available for analysts; individuals should dial 888-880-3330 (Domestic) or 646-357-8766 (International) ten to fifteen minutes before the scheduled conference call time. A replay of the live audio webcast can be accessed on the Partnership’s website at www.westernmidstream.com for one year after the call.
For additional details on WES’s financial and operational performance, please refer to the earnings slides and updated investor presentation available at www.westernmidstream.com.
ABOUT WESTERN MIDSTREAM
Western Midstream Partners, LP (“WES”) is a master limited partnership formed to develop, acquire, own, and operate midstream assets. With midstream assets located in Texas, New Mexico, Colorado, Utah, and Wyoming, WES is engaged in the business of gathering, compressing, treating, processing, and transporting natural gas; gathering, stabilizing, and transporting condensate, natural-gas liquids, and crude oil; and gathering, transporting, recycling, treating, and disposing of produced water for its customers. In its capacity as a natural-gas processor, WES also buys and sells residue, natural-gas liquids, and condensate on behalf of itself and its customers under certain gas processing contracts. A substantial majority of WES’s cash flows are protected from direct exposure to commodity-price volatility through fee-based contracts.
For more information about WES, please visit www.westernmidstream.com.
______________________________________________________________
(1)Please see the definitions of the Partnership’s non-GAAP measures at the end of this release and reconciliation of GAAP to non-GAAP measures.
(2)This release contains certain forward-looking non-GAAP measures such as the Adjusted EBITDA range, the Distributable Cash Flow range, and the Free Cash Flow range for the year ending December 31, 2026. A reconciliation of the Adjusted EBITDA range to net cash provided by operating activities and net income (loss), a reconciliation of the Distributable Cash Flow range to net income (loss), and a reconciliation of the Free Cash Flow range to net cash provided by operating activities, is not provided because the items necessary to estimate such amounts are not reasonably estimable at this time. These items, net of tax, may include, but are not limited to, impairments of assets and other charges, divestiture costs, acquisition costs, or changes in accounting principles. All of these items could significantly impact such financial measures. At this time, WES is not able to estimate the aggregate impact, if any, of these items on future period reported earnings. Accordingly, WES is not able to provide a corresponding forward-looking GAAP equivalent for the Adjusted EBITDA, Distributable Cash Flow, or Free Cash Flow ranges.
(3)Accrual-based, includes equity investments, excludes capitalized interest, and excludes capital expenditures associated with the 25% third-party interest in Chipeta.
(4)Represents total throughput attributable to WES, which excludes (i) the 1.8% limited partner interest in WES Operating owned by an Occidental subsidiary as of September 30, 2026, and (ii) for natural-gas throughput, the 25% third-party interest in Chipeta, which collectively represent WES’s noncontrolling interests.
FORWARD-LOOKING STATEMENTS
This news release contains forward-looking statements. WES’s management believes that its expectations are based on reasonable assumptions. No assurance, however, can be given that such expectations will prove correct. A number of factors could cause actual results to differ materially from the projections, anticipated results, or other expectations expressed in this news release. These factors include our ability to meet financial guidance or distribution expectations; our ability to safely and efficiently operate WES’s assets; the supply of, demand for, and price of oil, natural gas, NGLs, and related products or services; our ability to meet projected in-service dates for capital-growth projects; construction costs or capital expenditures exceeding estimated or budgeted costs or expenditures; and the other factors described in the “Risk Factors” section of WES’s most recent Form 10-K and Form 10-Q filed with the Securities and Exchange Commission and other public filings and press releases. WES undertakes no obligation to publicly update or revise any forward-looking statements.
# # #
Source: Western Midstream Partners, LP
WESTERN MIDSTREAM CONTACTS
Daniel Jenkins
Director, Investor Relations
Investors@westernmidstream.com
866.512.3523
Rhianna Disch
Manager, Investor Relations
Investors@westernmidstream.com
866.512.3523
3
Western Midstream Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
| Three Months Ended September 30, | ||||||||||||||
| thousands except per-unit amounts | 2026 | 2025 | ||||||||||||
| Revenues and other | ||||||||||||||
Service revenues – fee based | $ | 1,018,558 | $ | 868,253 | ||||||||||
Service revenues – product based | 88,161 | 33,919 | ||||||||||||
| Product sales | 95,709 | 50,129 | ||||||||||||
| Other | (8,211) | 183 | ||||||||||||
| Total revenues and other | 1,194,217 | 952,484 | ||||||||||||
| Equity income, net – related parties | 18,803 | 16,847 | ||||||||||||
| Operating expenses | ||||||||||||||
| Cost of product | 121,687 | 51,187 | ||||||||||||
| Operation and maintenance | 291,456 | 212,385 | ||||||||||||
| General and administrative | 87,783 | 64,119 | ||||||||||||
| Property and other taxes | 20,383 | 15,725 | ||||||||||||
| Depreciation and amortization | 223,776 | 170,323 | ||||||||||||
| Long-lived asset and other impairments | 557 | 11,562 | ||||||||||||
| Total operating expenses | 745,642 | 525,301 | ||||||||||||
| Gain (loss) on divestiture and other, net | (5,831) | (2,470) | ||||||||||||
| Operating income (loss) | 461,547 | 441,560 | ||||||||||||
| Interest expense | (116,580) | (92,353) | ||||||||||||
| Gain (loss) on early extinguishment of debt | — | — | ||||||||||||
| Other income (expense), net | 792 | 1,754 | ||||||||||||
| Income (loss) before income taxes | 345,759 | 350,961 | ||||||||||||
| Income tax expense (benefit) | 6,780 | 2,089 | ||||||||||||
| Net income (loss) | 338,979 | 348,872 | ||||||||||||
| Net income (loss) attributable to noncontrolling interests | 7,073 | 9,257 | ||||||||||||
Net income (loss) attributable to Western Midstream Partners, LP | $ | 331,906 | $ | 339,615 | ||||||||||
| Limited partners’ interest in net income (loss): | ||||||||||||||
Net income (loss) attributable to Western Midstream Partners, LP | $ | 331,906 | $ | 339,615 | ||||||||||
| General partner interest in net (income) loss | (7,122) | (7,885) | ||||||||||||
| Limited partners’ interest in net income (loss) | $ | 324,784 | $ | 331,730 | ||||||||||
| Net income (loss) per common unit – basic | $ | 0.79 | $ | 0.87 | ||||||||||
| Net income (loss) per common unit – diluted | $ | 0.78 | $ | 0.87 | ||||||||||
| Weighted-average common units outstanding – basic | 413,175 | 381,330 | ||||||||||||
| Weighted-average common units outstanding – diluted | 415,055 | 382,788 | ||||||||||||
4
Western Midstream Partners, LP
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
| thousands except number of units | September 30, 2026 | December 31, 2025 | ||||||||||||
| Total current assets | $ | 1,183,310 | $ | 1,656,941 | ||||||||||
| Net property, plant, and equipment | 12,594,701 | 11,220,908 | ||||||||||||
| Other assets | 2,655,948 | 2,120,571 | ||||||||||||
| Total assets | $ | 16,433,959 | $ | 14,998,420 | ||||||||||
| Total current liabilities | $ | 1,452,973 | $ | 1,236,484 | ||||||||||
| Long-term debt | 8,883,595 | 8,195,170 | ||||||||||||
| Asset retirement obligations | 491,139 | 427,858 | ||||||||||||
| Other liabilities | 1,257,856 | 975,786 | ||||||||||||
| Total liabilities | 12,085,563 | 10,835,298 | ||||||||||||
| Equity and partners’ capital | ||||||||||||||
| Common units (413,183,736 and 408,141,366 units issued and outstanding at September 30, 2026, and December 31, 2025, respectively) | 4,205,189 | 4,016,606 | ||||||||||||
| General partner units (9,060,641 units issued and outstanding at September 30, 2026, and December 31, 2025) | 3,202 | 4,624 | ||||||||||||
| Noncontrolling interests | 140,005 | 141,892 | ||||||||||||
| Total liabilities, equity, and partners’ capital | $ | 16,433,959 | $ | 14,998,420 | ||||||||||
5
Western Midstream Partners, LP
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
| Nine Months Ended September 30, | ||||||||||||||
| thousands | 2026 | 2025 | ||||||||||||
| Cash flows from operating activities | ||||||||||||||
| Net income (loss) | $ | 1,113,262 | $ | 1,016,186 | ||||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities and changes in assets and liabilities: | ||||||||||||||
| Depreciation and amortization | 630,147 | 512,896 | ||||||||||||
| Long-lived asset and other impairments | 1,716 | 12,251 | ||||||||||||
| (Gain) loss on divestiture and other, net | 16,796 | 8,048 | ||||||||||||
| (Gain) loss on early extinguishment of debt | 150 | — | ||||||||||||
| Change in other items, net | (189,922) | 115,599 | ||||||||||||
| Net cash provided by operating activities | $ | 1,572,149 | $ | 1,664,980 | ||||||||||
| Cash flows from investing activities | ||||||||||||||
| Capital expenditures | $ | (808,365) | $ | (505,783) | ||||||||||
| Acquisitions from third parties | (818,723) | — | ||||||||||||
| Contributions to equity investments - related parties | (27,710) | — | ||||||||||||
| Distributions from equity investments in excess of cumulative earnings – related parties | 13,988 | 26,000 | ||||||||||||
| Proceeds from the sale of assets to third parties | — | 162 | ||||||||||||
| (Increase) decrease in materials and supplies inventory and other | (19,181) | 3,329 | ||||||||||||
| Net cash provided by (used in) investing activities | $ | (1,659,991) | $ | (476,292) | ||||||||||
| Cash flows from financing activities | ||||||||||||||
| Borrowings, net of debt issuance costs | $ | 1,050,464 | $ | (1,171) | ||||||||||
| Repayments of debt | (800,505) | (1,000,589) | ||||||||||||
| Commercial paper borrowings (repayments), net | 265,771 | — | ||||||||||||
| Increase (decrease) in outstanding checks | 10,761 | (3,114) | ||||||||||||
| Distributions to Partnership unitholders | (1,146,997) | (1,051,503) | ||||||||||||
| Distributions to Chipeta noncontrolling interest owner | (7,578) | — | ||||||||||||
| Distributions to noncontrolling interest owner of WES Operating | (21,837) | (21,485) | ||||||||||||
| Other | (37,228) | (24,002) | ||||||||||||
| Net cash provided by (used in) financing activities | $ | (687,149) | $ | (2,101,864) | ||||||||||
| Net increase (decrease) in cash and cash equivalents | $ | (774,991) | $ | (913,176) | ||||||||||
| Cash and cash equivalents at beginning of period | 819,491 | 1,090,464 | ||||||||||||
| Cash and cash equivalents at end of period | $ | 44,500 | $ | 177,288 | ||||||||||
6
Western Midstream Partners, LP
RECONCILIATION OF GAAP TO NON-GAAP MEASURES
WES defines Adjusted Gross Margin attributable to Western Midstream Partners, LP (“Adjusted Gross Margin”) as total revenues and other (less reimbursements for electricity-related expenses recorded as revenue), less cost of product, plus distributions from equity investments, and excluding the noncontrolling interest owners’ proportionate share of revenues and cost of product. We believe Adjusted Gross Margin is an important performance measure of our operations’ profitability and performance as compared to other companies in the midstream industry. Cost of product expenses include (i) costs associated with the purchase of natural gas and NGLs pursuant to our percent-of-proceeds, percent-of-product, and keep-whole contracts, (ii) costs associated with the valuation of gas and NGLs imbalances, (iii) costs associated with our obligations under certain contracts to redeliver a volume of natural gas to shippers, which is thermally equivalent to condensate retained by us and sold to third parties, and (iv) costs associated with our offload commitments with third parties providing firm-processing capacity. The electricity-related expenses included in our Adjusted Gross Margin definition relate to pass-through expenses that are recorded as operation and maintenance expense with an offset recorded as revenue for the reimbursement by certain customers.
WES defines Adjusted EBITDA attributable to Western Midstream Partners, LP (“Adjusted EBITDA”) as net income (loss), plus (i) distributions from equity investments, (ii) non-cash equity-based compensation expense, (iii) interest expense, (iv) income tax expense, (v) depreciation and amortization, (vi) impairments, and (vii) other expense (including lower of cost or market inventory adjustments recorded in cost of product), less (i) gain (loss) on divestiture and other, net, (ii) gain (loss) on early extinguishment of debt, (iii) income from equity investments, (iv) income tax benefit, (v) other income, (vi) other items impacting comparability with our core operating performance, and (vii) the noncontrolling interest owners’ proportionate share of revenues and expenses. We believe the presentation of Adjusted EBITDA provides information useful to investors in assessing our financial condition and results of operations and that Adjusted EBITDA is a widely accepted financial indicator of a company’s ability to incur and service debt, fund capital expenditures, and make distributions. Adjusted EBITDA is a supplemental financial measure that management and external users of our consolidated financial statements, such as industry analysts, investors, commercial banks, and rating agencies, use, among other measures, to assess the following:
•our operating performance as compared to other publicly traded partnerships in the midstream industry, without regard to financing methods, capital structure, or historical cost basis;
•the ability of our assets to generate cash flow to make distributions; and
•the viability of acquisitions and capital expenditures and the returns on investment of various investment opportunities.
7
WES defines Distributable Cash Flow (“DCF”) as Adjusted EBITDA, less total revenues and other recognized in Adjusted EBITDA in excess of (less than) customer billings; net cash paid for (i) interest expense (net of interest income recorded in other income (expense) and non-cash capitalized interest), (ii) maintenance capital expenditures, and (iii) income taxes, and Distributable Cash Flow attributable to noncontrolling interests to the extent such amounts are not excluded from Adjusted EBITDA. We believe DCF provides useful information to management and investors because it is used by other companies in the midstream industry, as well as by analysts, as a supplemental performance measure to evaluate our operating performance after cash interest expense, maintenance capital expenditures, service revenues in excess of billings, and income taxes, and to compare our operating and financial performance with that of other publicly traded partnerships that may have different capital structures or financing methods. We utilize DCF as a measure of the operating performance of our asset base and as such reconcile it to net income (loss) and Adjusted EBITDA, with the adjustments intended to enhance period-over-period comparability. DCF does not reflect changes in working capital, growth capital expenditures, acquisitions, or debt or equity financing. DCF should not be viewed as a measure of our liquidity. When evaluating our liquidity, investors should focus on net cash provided by operating activities, as well as the overall statement of cash flows, and the “Liquidity and Capital Resources” section of our Management’s Discussion and Analysis of Financial Condition and Results of Operations.
WES defines Free Cash Flow as net cash provided by operating activities less total capital expenditures and contributions to equity investments, plus distributions from equity investments in excess of cumulative earnings. Management considers Free Cash Flow an appropriate metric for assessing capital discipline, cost efficiency, and balance-sheet strength. Although Free Cash Flow is the metric used to assess our ability to make distributions to unitholders, this measure should not be viewed as indicative of the actual amount of cash that is available for distributions or planned for distributions for a given period. Instead, Free Cash Flow represents the amount of cash that is available in aggregate for distributions, debt repayments, and other general partnership purposes.
Adjusted Gross Margin, Adjusted EBITDA, Distributable Cash Flow, and Free Cash Flow are not defined in GAAP. The GAAP measure that is most directly comparable to Adjusted Gross Margin is gross margin. Net income (loss) and net cash provided by operating activities are the GAAP measures that are most directly comparable to Adjusted EBITDA. The GAAP measure that is most directly comparable to Distributable Cash Flow is net income (loss). The GAAP measure that is most directly comparable to Free Cash Flow is net cash provided by operating activities. Our non-GAAP financial measures (i) should not be considered as alternatives to the comparable GAAP measures or any other measure of financial performance presented in accordance with GAAP, (ii) have important limitations as analytical tools because they exclude some, but not all, items that affect the comparable GAAP measures, (iii) should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP, and (iv) may not be comparable to similarly titled measures of other companies in our industry, thereby diminishing their utility as comparative measures.
Management compensates for the limitations of our non-GAAP measures as analytical tools by reviewing the comparable GAAP measures, understanding the differences, and incorporating this knowledge into its decision-making processes. We believe that investors benefit from having access to the same financial measures that our management considers in evaluating our operating results.
The following tables present reconciliations of the GAAP measures to our non-GAAP measures:
8
Western Midstream Partners, LP
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (CONTINUED)
(Unaudited)
Adjusted Gross Margin
| Three Months Ended | ||||||||||||||
| thousands | September 30, 2026 | June 30, 2026 | ||||||||||||
| Reconciliation of Gross margin to Adjusted Gross Margin | ||||||||||||||
| Total revenues and other | $ | 1,194,217 | $ | 1,224,719 | ||||||||||
| Less: | ||||||||||||||
| Cost of product | 121,687 | 117,440 | ||||||||||||
Depreciation and amortization | 223,776 | 205,945 | ||||||||||||
| Gross margin | 848,754 | 901,334 | ||||||||||||
| Add: | ||||||||||||||
| Distributions from equity investments | 24,514 | 24,630 | ||||||||||||
Depreciation and amortization | 223,776 | 205,945 | ||||||||||||
| Less: | ||||||||||||||
| Reimbursed electricity-related charges recorded as revenues | 34,108 | 33,410 | ||||||||||||
Adjusted Gross Margin attributable to noncontrolling interests (1) | 23,272 | 23,978 | ||||||||||||
| Adjusted Gross Margin | $ | 1,039,664 | $ | 1,074,521 | ||||||||||
| Gross margin | ||||||||||||||
Gross margin for natural-gas assets (2) | $ | 556,113 | $ | 567,265 | ||||||||||
Gross margin for crude-oil and NGLs assets (2) | 103,161 | 116,084 | ||||||||||||
Gross margin for produced-water assets (2) | 203,780 | 216,927 | ||||||||||||
| Adjusted Gross Margin | ||||||||||||||
Adjusted Gross Margin for natural-gas assets (2) | $ | 662,699 | $ | 658,322 | ||||||||||
Adjusted Gross Margin for crude-oil and NGLs assets (2) | 141,855 | 153,071 | ||||||||||||
Adjusted Gross Margin for produced-water assets (2) | 244,813 | 257,257 | ||||||||||||
(1)Includes (i) the 25% third-party interest in Chipeta and (ii) the 1.8% and 1.8% limited partner interest in WES Operating owned by an Occidental subsidiary as of September 30, 2026, and June 30, 2026, respectively, which collectively represent WES’s noncontrolling interests.
(2)Excludes corporate-level depreciation and amortization and other corporate-level items.
9
Western Midstream Partners, LP
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (CONTINUED)
(Unaudited)
Adjusted EBITDA
| Three Months Ended | ||||||||||||||
| thousands | September 30, 2026 | June 30, 2026 | ||||||||||||
| Reconciliation of Net income (loss) to Adjusted EBITDA | ||||||||||||||
| Net income (loss) | $ | 338,979 | $ | 415,251 | ||||||||||
| Add: | ||||||||||||||
| Distributions from equity investments | 24,514 | 24,630 | ||||||||||||
| Non-cash equity-based compensation expense | 12,730 | 13,507 | ||||||||||||
| Interest expense | 116,580 | 108,984 | ||||||||||||
| Income tax expense | 6,780 | 5,152 | ||||||||||||
| Depreciation and amortization | 223,776 | 205,945 | ||||||||||||
Long-lived asset and other impairments | 557 | 551 | ||||||||||||
| Other expense | — | 329 | ||||||||||||
| Less: | ||||||||||||||
| Gain (loss) on divestiture and other, net | (5,831) | (4,598) | ||||||||||||
| Gain (loss) on early extinguishment of debt | — | (150) | ||||||||||||
| Equity income, net – related parties | 18,803 | 21,536 | ||||||||||||
| Other income | 835 | 2,834 | ||||||||||||
| Items impacting comparability | ||||||||||||||
| Acquisition-related expenses and other, net | (12,514) | 476 | ||||||||||||
Adjusted EBITDA attributable to noncontrolling interests (1) | 14,275 | 17,719 | ||||||||||||
| Adjusted EBITDA | $ | 708,348 | $ | 736,532 | ||||||||||
| Reconciliation of Net cash provided by operating activities to Adjusted EBITDA | ||||||||||||||
| Net cash provided by operating activities | $ | 567,510 | $ | 534,736 | ||||||||||
| Interest expense | 116,580 | 108,984 | ||||||||||||
| Accretion and amortization of long-term obligations, net | (921) | (734) | ||||||||||||
| Current income tax expense (benefit) | 2,448 | 3,515 | ||||||||||||
| Other (income) expense, net | (792) | (2,834) | ||||||||||||
| Distributions from equity investments in excess of cumulative earnings – related parties | 4,081 | 18 | ||||||||||||
| Changes in assets and liabilities: | ||||||||||||||
| Accounts receivable, net | 120,046 | 47,756 | ||||||||||||
| Accounts and imbalance payables and accrued liabilities, net | (122,949) | (6,425) | ||||||||||||
| Other items, net | 24,106 | 69,711 | ||||||||||||
| Acquisition-related expenses and other, net | 12,514 | (476) | ||||||||||||
Adjusted EBITDA attributable to noncontrolling interests (1) | (14,275) | (17,719) | ||||||||||||
| Adjusted EBITDA | $ | 708,348 | $ | 736,532 | ||||||||||
| Cash flow information | ||||||||||||||
| Net cash provided by operating activities | $ | 567,510 | $ | 534,736 | ||||||||||
| Net cash provided by (used in) investing activities | (317,768) | (1,107,346) | ||||||||||||
| Net cash provided by (used in) financing activities | (310,008) | 29,881 | ||||||||||||
(1)Includes (i) the 25% third-party interest in Chipeta and (ii) the 1.8% and 1.8% limited partner interest in WES Operating owned by an Occidental subsidiary as of September 30, 2026, and June 30, 2026, respectively, which collectively represent WES’s noncontrolling interests.
10
Western Midstream Partners, LP
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (CONTINUED)
(Unaudited)
Distributable Cash Flow
| Three Months Ended | ||||||||||||||
| thousands | September 30, 2026 | June 30, 2026 | ||||||||||||
| Reconciliation of Net income (loss) to Distributable Cash Flow | ||||||||||||||
| Net income (loss) | $ | 338,979 | $ | 415,251 | ||||||||||
| Add: | ||||||||||||||
| Distributions from equity investments | 24,514 | 24,630 | ||||||||||||
| Non-cash equity-based compensation expense | 12,730 | 13,507 | ||||||||||||
| Income tax expense | 6,780 | 5,152 | ||||||||||||
| Depreciation and amortization | 223,776 | 205,945 | ||||||||||||
| Long-lived asset and other impairments | 557 | 551 | ||||||||||||
| Other expense | — | 329 | ||||||||||||
| Less: | ||||||||||||||
| Recognized service revenues – fee based in excess of (less than) customer billings | 38,135 | 52,810 | ||||||||||||
| Gain (loss) on divestiture and other, net | (5,831) | (4,598) | ||||||||||||
| Gain (loss) on early extinguishment of debt | — | (150) | ||||||||||||
| Equity income, net - related parties | 18,803 | 21,536 | ||||||||||||
| Items impacting comparability | (12,514) | 476 | ||||||||||||
| Cash paid for maintenance capital expenditures | 37,966 | 26,681 | ||||||||||||
| Capitalized interest | 7,864 | 6,713 | ||||||||||||
| Cash paid for (reimbursement of) income taxes | (127) | 10,169 | ||||||||||||
| Other income (net of interest income) | 36 | 495 | ||||||||||||
Distributable Cash Flow attributable to noncontrolling interests (1) | 10,699 | 14,076 | ||||||||||||
| Distributable Cash Flow | $ | 512,305 | $ | 537,157 | ||||||||||
| Reconciliation of Adjusted EBITDA to Distributable Cash Flow | ||||||||||||||
| Adjusted EBITDA | $ | 708,348 | $ | 736,532 | ||||||||||
| Less: | ||||||||||||||
| Recognized service revenues - fee based in excess of (less than) customer billings | 38,135 | 52,810 | ||||||||||||
| Capitalized interest | 7,864 | 6,713 | ||||||||||||
| Cash paid for maintenance capital expenditures | 37,966 | 26,681 | ||||||||||||
| Cash paid for (reimbursement of) income taxes | (127) | 10,169 | ||||||||||||
| Interest expense (net of interest income) | 115,781 | 106,645 | ||||||||||||
Distributable Cash Flow attributable to noncontrolling interests (1) | (3,576) | (3,643) | ||||||||||||
| Distributable Cash Flow | $ | 512,305 | $ | 537,157 | ||||||||||
| Weighted-average common units outstanding | 413,175 | 398,043 | ||||||||||||
| Weighted-average general partner units | 9,061 | 9,061 | ||||||||||||
(1)Includes (i) the 25% third-party interest in Chipeta and (ii) the 1.8% and 1.8% limited partner interest in WES Operating owned by an Occidental subsidiary as of September 30, 2026, and June 30, 2026, respectively, which collectively represent WES’s noncontrolling interests.
11
Western Midstream Partners, LP
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (CONTINUED)
(Unaudited)
Free Cash Flow
| Three Months Ended | ||||||||||||||
| thousands | September 30, 2026 | June 30, 2026 | ||||||||||||
| Reconciliation of Net cash provided by operating activities to Free Cash Flow | ||||||||||||||
| Net cash provided by operating activities | $ | 567,510 | $ | 534,736 | ||||||||||
| Less: | ||||||||||||||
| Capital expenditures | 302,300 | 270,339 | ||||||||||||
| Contributions to equity investments – related parties | 25,132 | 810 | ||||||||||||
| Add: | ||||||||||||||
| Distributions from equity investments in excess of cumulative earnings – related parties | 4,081 | 18 | ||||||||||||
| Free Cash Flow | $ | 244,159 | $ | 263,605 | ||||||||||
| Cash flow information | ||||||||||||||
| Net cash provided by operating activities | $ | 567,510 | $ | 534,736 | ||||||||||
| Net cash provided by (used in) investing activities | (317,768) | (1,107,346) | ||||||||||||
| Net cash provided by (used in) financing activities | (310,008) | 29,881 | ||||||||||||
12
Western Midstream Partners, LP
OPERATING STATISTICS
(Unaudited)
| Three Months Ended | ||||||||||||||||||||
| September 30, 2026 | June 30, 2026 | Inc/ (Dec) | ||||||||||||||||||
| Throughput for natural-gas assets (MMcf/d) | ||||||||||||||||||||
| Gathering, treating, and transportation | 451 | 427 | 6 | % | ||||||||||||||||
| Processing | 5,018 | 4,597 | 9 | % | ||||||||||||||||
Equity investments (1) | 467 | 494 | (5) | % | ||||||||||||||||
| Total throughput | 5,936 | 5,518 | 8 | % | ||||||||||||||||
Throughput attributable to noncontrolling interests (2) | 193 | 175 | 10 | % | ||||||||||||||||
| Total throughput attributable to WES for natural-gas assets | 5,743 | 5,343 | 7 | % | ||||||||||||||||
| Throughput for crude-oil and NGLs assets (MBbls/d) | ||||||||||||||||||||
| Gathering, treating, and transportation | 426 | 425 | — | % | ||||||||||||||||
Equity investments (1) | 109 | 108 | 1 | % | ||||||||||||||||
| Total throughput | 535 | 533 | — | % | ||||||||||||||||
Throughput attributable to noncontrolling interests (2) | 9 | 10 | (10) | % | ||||||||||||||||
| Total throughput attributable to WES for crude-oil and NGLs assets | 526 | 523 | 1 | % | ||||||||||||||||
| Throughput for produced-water assets (MBbls/d) | ||||||||||||||||||||
| Gathering, disposal, and water solutions | 3,047 | 2,993 | 2 | % | ||||||||||||||||
Throughput attributable to noncontrolling interests (2) | 55 | 54 | 2 | % | ||||||||||||||||
| Total throughput attributable to WES for produced-water assets | 2,992 | 2,939 | 2 | % | ||||||||||||||||
Per-Mcf Gross margin for natural-gas assets (3) | $ | 1.02 | $ | 1.13 | (10) | % | ||||||||||||||
Per-Bbl Gross margin for crude-oil and NGLs assets (3) | 2.10 | 2.39 | (12) | % | ||||||||||||||||
Per-Bbl Gross margin for produced-water assets (3) | 0.73 | 0.80 | (9) | % | ||||||||||||||||
Per-Mcf Adjusted Gross Margin for natural-gas assets (4) | $ | 1.25 | $ | 1.35 | (7) | % | ||||||||||||||
Per-Bbl Adjusted Gross Margin for crude-oil and NGLs assets (4) | 2.93 | 3.21 | (9) | % | ||||||||||||||||
Per-Bbl Adjusted Gross Margin for produced-water assets (4) | 0.89 | 0.96 | (7) | % | ||||||||||||||||
(1)Represents our share of average throughput for investments accounted for under the equity method of accounting.
(2)Includes (i) the 1.8% and 1.8% limited partner interest in WES Operating owned by an Occidental subsidiary as of September 30, 2026, and June 30, 2026, respectively, and (ii) for natural-gas assets, the 25% third-party interest in Chipeta, which collectively represent WES’s noncontrolling interests.
(3)Average for period. Calculated as Gross margin for natural-gas assets, crude-oil and NGLs assets, or produced-water assets, divided by the respective total throughput (MMcf or MBbls) for natural-gas assets, crude-oil and NGLs assets, or produced-water assets.
(4)Average for period. Calculated as Adjusted Gross Margin for natural-gas assets, crude-oil and NGLs assets, or produced-water assets, divided by the respective total throughput (MMcf or MBbls) attributable to WES for natural-gas assets, crude-oil and NGLs assets, or produced-water assets.
13
Western Midstream Partners, LP
OPERATING STATISTICS (CONTINUED)
(Unaudited)
| Three Months Ended | ||||||||||||||||||||
| September 30, 2026 | June 30, 2026 | Inc/ (Dec) | ||||||||||||||||||
| Throughput for natural-gas assets (MMcf/d) | ||||||||||||||||||||
| Operated | ||||||||||||||||||||
| Delaware Basin | 2,562 | 2,140 | 20 | % | ||||||||||||||||
| DJ Basin | 1,482 | 1,547 | (4) | % | ||||||||||||||||
| Powder River Basin | 400 | 398 | 1 | % | ||||||||||||||||
| Other | 978 | 895 | 9 | % | ||||||||||||||||
| Total operated throughput for natural-gas assets | 5,422 | 4,980 | 9 | % | ||||||||||||||||
| Non-operated | ||||||||||||||||||||
| Equity investments | 467 | 494 | (5) | % | ||||||||||||||||
| Other | 47 | 44 | 7 | % | ||||||||||||||||
| Total non-operated throughput for natural-gas assets | 514 | 538 | (4) | % | ||||||||||||||||
| Total throughput for natural-gas assets | 5,936 | 5,518 | 8 | % | ||||||||||||||||
| Throughput for crude-oil and NGLs assets (MBbls/d) | ||||||||||||||||||||
| Operated | ||||||||||||||||||||
| Delaware Basin | 272 | 265 | 3 | % | ||||||||||||||||
| DJ Basin | 90 | 94 | (4) | % | ||||||||||||||||
| Powder River Basin | 24 | 27 | (11) | % | ||||||||||||||||
| Other | 40 | 39 | 3 | % | ||||||||||||||||
| Total operated throughput for crude-oil and NGLs assets | 426 | 425 | — | % | ||||||||||||||||
| Non-operated | ||||||||||||||||||||
| Equity investments | 109 | 108 | 1 | % | ||||||||||||||||
| Total non-operated throughput for crude-oil and NGLs assets | 109 | 108 | 1 | % | ||||||||||||||||
| Total throughput for crude-oil and NGLs assets | 535 | 533 | — | % | ||||||||||||||||
| Throughput for produced-water assets (MBbls/d) | ||||||||||||||||||||
| Operated | ||||||||||||||||||||
| Delaware Basin | 3,047 | 2,993 | 2 | % | ||||||||||||||||
| Total operated throughput for produced-water assets | 3,047 | 2,993 | 2 | % | ||||||||||||||||
14