Marathon Petroleum Reports $74 Million Loss in Q1 2025 Amid Declining Refining Margins

Marathon Petroleum Corporation (MPC) reported a significant decline in financial performance for the first quarter of 2025, with net income attributable to the company falling to a loss of $74 million, or $(0.24) per diluted share, compared to a profit of $937 million, or $2.58 per diluted share, in the same period last year. Total revenues and other income decreased to $31.85 billion from $33.21 billion, primarily driven by lower refining margins and a decrease in average refined product sales prices. The company's income from operations also dropped to $687 million from $1.78 billion in the prior year, reflecting a challenging market environment.

The decline in profitability was attributed to a decrease in refining and marketing margins, which fell to $13.38 per barrel from $19.35 per barrel year-over-year. This was compounded by a decrease in average refined product sales prices, which dropped by $0.22 per gallon, despite an increase in refined product sales volumes of 204 thousand barrels per day. The company also noted a decrease in other income, largely due to the absence of insurance proceeds received in the first quarter of 2024.

In terms of strategic developments, MPC completed the acquisition of gathering businesses from Whiptail Midstream for $237 million in cash, enhancing its midstream operations. The company also reported a significant increase in its cash and cash equivalents, which rose to $3.81 billion from $3.21 billion at the end of 2024. Additionally, MPC's capital expenditures for the quarter totaled $644 million, up from $511 million in the same period last year, reflecting ongoing investments in refining and marketing projects.

Operationally, the company reported a net refinery throughput of 2.85 million barrels per day, an increase from 2.66 million barrels per day in the previous year. However, the refining segment's adjusted EBITDA fell to $489 million from $1.99 billion, indicating the impact of lower margins on overall profitability. The midstream segment, on the other hand, saw an increase in adjusted EBITDA to $1.72 billion from $1.59 billion, driven by higher throughputs and contributions from recent acquisitions.

Looking ahead, Marathon Petroleum anticipates that global demand growth will outpace the impact of capacity additions through the end of the decade, supporting a constructive environment for U.S. refiners. However, the company remains cautious about the regulatory landscape in California, where new legislation may impose additional operational constraints. Overall, while the first quarter results reflect significant challenges, the company is focused on strategic growth and operational efficiency to navigate the evolving market conditions.