The Houston-based refiner earned $207 million in the first quarter, reversing a loss from a year earlier, as crude utilization hit 95%
Phillips 66 $PSX reported first-quarter earnings of $207 million, or $0.51 per diluted share, reversing a loss of $368 million on an adjusted basis from the same period a year earlier. Adjusted earnings came in at $200 million, or $0.49 per share.
Wall Street had expected a loss of $0.40 per share on an adjusted basis, per Reuters, which cited LSEG data.
The refining segment was the primary driver of the beat. Adjusted pre-tax income from refining reached $208 million in the quarter, compared with a loss of $937 million in the first quarter of 2025. On a per-barrel basis, the company's realized margin improved to $10.11 from $6.81 in the year-ago period, while crude capacity utilization climbed to 95% from 80% over the same stretch.
Results were partly offset by the $839 million mark-to-market charge stemmed from short derivative positions the company holds as economic hedges against exposure on certain physical inventory. Because the associated physical inventory is carried under last-in, first-out accounting, the increase in its market value was not reflected in reported results. The losses were spread across the refining, marketing and specialties, and renewable fuels segments.
The company's marketing and specialties segment recorded an adjusted pre-tax loss of $141 million for the quarter, while renewable fuels posted a pre-tax loss of $41 million.
Phillips 66 $PSX ended the quarter with liquidity of about $6.0 billion, including $5.2 billion in cash and cash equivalents. Total debt stood at $27.1 billion, bringing the debt-to-capital ratio to 48%, up from 39% at the end of the fourth quarter of 2025.
The company returned $778 million to shareholders during the quarter, comprising $509 million in dividends and $269 million in stock repurchases. Phillips 66 also raised its annualized quarterly dividend by 7%.
"We are confident in our ability to navigate market volatility due to our integrated business and the strength of our balance sheet," CEO Mark Lashier said in a statement. "We remain committed to our previously stated shareholder return and debt reduction targets."
In premarket trading after the results were released, Phillips 66 shares gained 2.2%.
