Business Overview
Hess Midstream LP (NYSE: HESM) operates a fee-based midstream system serving the Bakken shale region. The partnership provides gathering, processing, storage, terminaling, and water handling services under long-term commercial agreements. Its asset base is designed to support crude oil, natural gas, and produced water volumes primarily from dedicated acreage operated by its customers. The partnership’s business model emphasizes contracted cash flows and infrastructure positioned near upstream production activity.
Financial Performance
For the fourth quarter of fiscal 2025, Hess Midstream reported total revenues and other income of $404.2 million and net income of $168.0 million. Compared with the same quarter of the prior year, revenue declined from $395.9 million, while net income decreased from $172.1 million. For the full fiscal year, consolidated revenue totaled $1.61 billion, compared with $1.50 billion in the prior year. Full-year net income increased to $640.0 million from $620.5 million a year earlier. Results reflected changes in throughput volumes and the timing of certain contractual and operational items.
Operating Metrics
Segment revenue for the quarter comprised $217.3 million from Gathering, $154.7 million from Processing and Storage, and $32.2 million from Terminaling and Export. Quarterly revenue trends showed moderation from the prior quarter while remaining above the prior-year quarter. Operating metrics continue to be driven by fee-based arrangements linked to throughput and minimum volume commitments.
Key Developments
During the quarter, the partnership placed a new compressor station into service in January 2026, adding approximately 50 million cubic feet per day of installed gas compression capacity. Capital expenditures for the quarter totaled $47.6 million, reflecting continued investment in midstream infrastructure. Management also referenced previously disclosed strategic changes in ownership at the parent level, which did not alter the partnership’s asset footprint or operating agreements.
Risks and Constraints
Risks identified in company disclosures include variability in throughput volumes, regulatory approvals affecting infrastructure projects, and exposure to operational disruptions. Additional considerations include changes in customer development plans, cost inflation related to maintenance activities, and environmental compliance requirements. While contracts provide a degree of revenue stability, volume fluctuations can affect near-term results.
Outlook / Guidance
What to watch for includes execution against previously issued full-year 2026 guidance, capital spending discipline, and throughput nominations from key customers. Market participants will also monitor progress on projects placed into service and the partnership’s ability to maintain leverage within targeted ranges under its financing arrangements.
Performance Summary
Fourth-quarter revenue totaled $404.2 million, and net income was $168.0 million. Segment revenues were led by Gathering and Processing and Storage. The partnership continued to operate under long-term, fee-based contracts while advancing infrastructure projects placed into service during the period.