10q10k10q10k.net

What changed in Kinetik Holdings Inc.'s 10-K — 2024 vs 2025

vs

Paragraph-level year-over-year comparison of Kinetik Holdings Inc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+227 added−210 removedSource: 10-K (2026-02-26) vs 10-K (2025-03-03)

Top changes in Kinetik Holdings Inc.'s 2025 10-K

227 paragraphs added · 210 removed · 146 edited across 6 sections

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

46 edited+27 added−8 removed144 unchanged
Biggest changeThe adoption and implementation of any federal, regional or state legislation, executive actions, regulations or other regulatory and policy initiatives that impose more stringent standards for GHG emissions, restrict the areas in which the oil and gas industry may produce crude oil and natural gas or generate GHG emissions, increase scrutiny of environmental permitting or delay such permitting reviews, or require enhanced disclosure of such GHG emission and other climate-related information, could result in reduced demand for crude oil and natural gas, and thus our services, as well as increase our compliance costs.
Biggest changeThe adoption and implementation of any federal, regional or state legislation, executive actions, regulations or other regulatory and policy initiatives that impose more stringent standards for GHG emissions, restrict the areas in which the oil and gas industry may produce crude oil and natural gas or generate GHG emissions, increase scrutiny of environmental permitting or delay such permitting reviews, or require enhanced disclosure of such GHG emission and other climate-related information, could result in reduced demand for crude oil and natural gas, and thus our services, as well as increase our compliance costs. 20 Table of Contents Index to Financial Statements Although it is not possible at this time to predict how legislation or new regulations that may be adopted to address GHG emissions and climate change could impact our business, any such future laws and regulations could have a material adverse effect on our business, demand for our services, financial condition, results of operations and cash flows.
The operations of the third parties on whom the Company relies on to provide downstream transportation and delivery options from its processing system are subject to complex and stringent laws and regulations that require obtaining and maintaining numerous permits, approvals and certifications from various federal, state and local government authorities.
The operations of the third parties on whom the Company relies to provide downstream transportation and delivery options from its processing system are subject to complex and stringent laws and regulations that require obtaining and maintaining numerous permits, approvals and certifications from various federal, state and local government authorities.
The Company’s operations are subject to all the hazards inherent in the gathering and transportation of crude oil, natural gas and produced water, including: • damage to pipelines, compressor stations, centralized gathering facilities, pump stations, storage terminals, related equipment, and surrounding properties caused by design, installation, construction materials or operational flaws, natural disasters, acts of terrorism, acts of third parties or other unforeseen circumstances. 16 Table of Contents Index to Financial Statements • leaks of crude oil, natural gas or NGLs or losses of crude oil, natural gas or NGLs as a result of the malfunction of, or other disruptions associated with, equipment, facilities or pipelines; • fires, ruptures and explosions; and • other hazards that could also result in personal injury and loss of life, pollution and suspension of operations.
The Company’s operations are subject to all the hazards inherent in the gathering and transportation of crude oil, natural gas and produced water, including: • damage to pipelines, compressor stations, centralized gathering facilities, pump stations, storage terminals, related equipment, and surrounding properties caused by design, installation, construction materials or operational flaws, natural disasters, acts of terrorism, acts of third parties or other unforeseen circumstances. • leaks of crude oil, natural gas or NGLs or losses of crude oil, natural gas or NGLs as a result of the malfunction of, or other disruptions associated with, equipment, facilities or pipelines; 16 Table of Contents Index to Financial Statements • fires, ruptures and explosions; and • other hazards that could also result in personal injury and loss of life, pollution and suspension of operations.
The Company’s intrastate NGL transportation services are subject to the TRRC regulations and must be provided in a manner that is just, reasonable and non-discriminatory. Such operations could be subject to additional regulation if the NGLs and crude oil are transported in interstate or through foreign commerce, whether by the Company’s pipelines or other means of transportation.
The Company’s intrastate NGL transportation services are subject to TRRC regulations and must be provided in a manner that is just, reasonable and non-discriminatory. Such operations could be subject to additional regulation if the NGLs and crude oil are transported in interstate or through foreign commerce, whether by the Company’s pipelines or other means of transportation.
We cannot provide any assurance that we will be able to find complementary acquisition targets or complete such acquisitions or achieve the desired results from any acquisitions we do complete. Any acquired businesses or assets will be subject to many of the same risks as our existing businesses and may not achieve the levels of performance that we anticipate.
We cannot provide any assurance that we will be able to find complementary acquisition targets or complete such acquisitions or achieve the desired results from any acquisitions we complete. Any acquired businesses or assets will be subject to many of the same risks as our existing businesses and may not achieve the levels of performance that we anticipate.
Increasing attention to climate change, societal expectations on companies to address climate change, investor and societal expectations regarding voluntary sustainability disclosures and consumer demand for alternative forms of energy may result in increased costs, reduced demand for the Company’s products, reduced profits, increased investigations and litigation and negative impacts on the Company’s access to capital markets.
Increased attention to climate change, societal expectations on companies to address climate change, investor and societal expectations regarding voluntary sustainability disclosures and consumer demand for alternative forms of energy may result in increased costs, reduced demand for the Company’s products, reduced profits, increased investigations and litigation and negative impacts on the Company’s access to capital markets.
However, we do not expect to significantly increase the amount of stock repurchases until our gross debt is reduced below certain thresholds. Although the Company repurchased Class A Common Stock during 2023 and will continue to repurchase Class A Common Stock in accordance with the stock repurchase program, such program may not enhance long-term stockholder value.
However, we do not expect to significantly increase the amount of stock repurchases until our gross debt is reduced below certain thresholds. Although the Company repurchased Class A Common Stock during 2025 and will continue to repurchase Class A Common Stock in accordance with the stock repurchase program, such program may not enhance long-term stockholder value.
Environmental and Regulatory Risk Related to the Company The Company operates in a highly regulated environment and its business and profitability could be adversely affected by actions by governmental entities, changes to current laws or regulations, or a failure to comply with laws or regulations.
Environmental and Regulatory Risks Related to the Company The Company operates in a highly regulated environment and its business and profitability could be adversely affected by actions by governmental entities, changes to current laws or regulations, or a failure to comply with laws or regulations.
Increasing attention to climate change and environmental conservation, for example, may result in demand shifts for oil and natural gas products and additional governmental investigations and private litigation against the Company or its customers.
Increased attention to climate change and environmental conservation, for example, may result in demand shifts for oil and natural gas products and additional governmental investigations and private litigation against the Company or its customers.
The use of derivative financial instruments could result in material financial losses by us. The Company engages in commodity and interest rate hedging activities to reduce its exposure to fluctuations in commodity prices and interest rates by using derivative instruments.
The use of derivative financial instruments could result in material financial losses for the Company. The Company engages in commodity and interest rate hedging activities to reduce its exposure to fluctuations in commodity prices and interest rates by using derivative instruments.
If we do not comply with this regulation, we may be subject to claims for refunds of amounts charged, the modification, cancellation or suspension of a permit or other authorization, civil penalties and other relief. Additional rules and legislation pertaining to these matters are considered or adopted from time to time.
If we do not comply with these regulations, we may be subject to claims for refunds of amounts charged, the modification, cancellation or suspension of a permit or other authorization, civil penalties and other relief. Additional rules and legislation pertaining to these matters are considered or adopted from time to time.
The Company’s ability to return capital to stockholders through dividends and stock repurchases principally depends upon the amount of cash it generates from its operations, which will fluctuate from quarter to quarter based on, among other things, income from the Pipeline Transportation JVs, which are accounted for using equity method, the volumes of natural gas and NGLs it gathers and processes, commodity prices, and other factors impacting the Company’s financial condition, some of which are beyond its control.
The Company’s ability to return capital to stockholders through dividends and stock repurchases principally depends upon the amount of cash it generates from its operations, which will fluctuate from quarter to quarter based on, among other things, income from the EMI Pipelines, which are accounted for using equity method, the volumes of natural gas and NGLs it gathers and processes, commodity prices, and other factors impacting the Company’s financial condition, some of which are beyond its control.
In addition, the Company has no control over producers or their exploration and development decisions, which may be affected by, among other things: • the availability and cost of capital; • the prevailing and projected prices of crude oil, natural gas and NGLs; fewer project opportunities or assumption of risk that results in weaker or more volatile financial performance than expected; • assets that vary in age and were constructed over many decades which may cause our inspection, maintenance or repair costs to increase in the future; • political and economic conditions and events in foreign oil, natural gas and NGL producing countries, including embargoes, disrupted global supply chains, continued hostilities in the Middle East and other sustained military campaigns, the armed conflict in Ukraine and associated economic sanctions on Russia; • increase in interest rates and rising or sustained inflation; • levels of crude oil and natural gas reserves; • contractor or supplier non-performance, weather, geological or other factors; • Consolidation in the upstream and midstream sector and the resulting changes in the strategic importance customers assign to development in certain acreage or locations in the Delaware Basin as opposed to other areas, which could adversely affect the financial and operational resources devoted to development of their acreage dedicated to the Company; • increased levels of taxation related to the exploration and production of crude oil, natural gas and NGLs; • environmental or other governmental regulations, including those related to the prorationing of oil and gas production, the availability of permits, the regulation of hydraulic fracturing, and a governmental determination that multiple facilities are to be treated as a single source for air permitting purposes; 13 Table of Contents Index to Financial Statements • the costs of producing and ability to produce crude oil, natural gas and NGLs and the availability and costs of drilling rigs, pipeline transportation facilities and other equipment; and • potential tariff to be imposed by the Trump Administration on crude oil, natural gas and NGLs and other imported supplies and equipment.
In addition, the Company has no control over producers or their exploration and development decisions, which may be affected by, among other things: • the availability and cost of capital; • the prevailing and projected prices of crude oil, natural gas and NGLs; fewer project opportunities or assumption of risk that results in weaker or more volatile financial performance than expected; • assets that vary in age and were constructed over many decades which may cause our inspection, maintenance or repair costs to increase in the future; • political and economic conditions and events in foreign oil, natural gas and NGL producing countries, including embargoes, disrupted global supply chains, continued hostilities in the Middle East and other sustained military campaigns, the armed conflict in Ukraine and associated economic sanctions on Russia, and recent events in Venezuela; • increase in interest rates and rising or sustained inflation; • levels of crude oil and natural gas reserves; • contractor or supplier non-performance, weather, geological or other factors; • Consolidation in the upstream and midstream sector and the resulting changes in the strategic importance customers assign to development in certain acreage or locations in the Delaware Basin as opposed to other areas, which could adversely affect the financial and operational resources devoted to development of their acreage dedicated to the Company; • increased levels of taxation related to the exploration and production of crude oil, natural gas and NGLs; • environmental or other governmental regulations, including those related to the prorationing of oil and gas production, the availability of permits, the regulation of hydraulic fracturing, and a governmental determination that multiple facilities are to be treated as a single source for air permitting purposes; • the costs of producing and ability to produce crude oil, natural gas and NGLs and the availability and costs of drilling rigs, pipeline transportation facilities and other equipment; and • potential tariffs to be imposed by the Trump Administration and reciprocal tariffs by foreign governments on crude oil, natural gas and NGLs and other imported supplies and equipment. 13 Table of Contents Index to Financial Statements Due to these and other factors, even if reserves are known to exist in areas served by the Company’s midstream assets, producers may choose not to develop those reserves.
The Company’s charter designates the “Court of Chancery” as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by its stockholders, which could limit its stockholders’ ability to obtain a favorable judicial forum for disputes with the Company or its directors, officers, employees or agents.
The Company’s charter designates the Court of Chancery as the sole and exclusive forum for certain types of actions and proceedings that may be initiated by its stockholders, which could limit its stockholders’ ability to obtain a favorable judicial forum for disputes with the Company or its directors, officers, employees or agents.
Fluctuations or changes in the Company’s quarterly financial results, changes in or failure to meet market or financial analysts’ expectations about the Company, changes in laws and regulations, commencement of or involvement in litigation, changes in the Company’s capital structure and general economic and political conditions could materially and adversely affect a stockholder’s investment in the Company’s securities, and its securities may trade at prices significantly below the price paid for them.
Fluctuations or changes in the Company’s quarterly financial results, changes in or failure to meet market or financial analysts’ expectations about the Company, changes in laws and regulations, commencement, settlement or judgment involving litigation, changes in the Company’s capital structure and general economic and political conditions could materially and adversely affect a stockholder’s investment in the Company’s securities, and its securities may trade at prices significantly below the price paid for them.
The Company’s operations are therefore subject to disruption from natural or human causes beyond its control, including risks from hurricanes, severe storms, floods, heat waves, other forms of severe weather, wildfires, sea level rise, ambient temperature increases, war or other military conflicts such as the ongoing conflicts in Ukraine, Israel and the Gaza Strip, accidents, civil unrest, global political events, fires, earthquakes, and epidemic or 23 Table of Contents Index to Financial Statements pandemic diseases such as the COVID-19 pandemic, some of which may be impacted by climate change and any of which could result in suspension of operations or harm to people or the natural environment.
The Company’s operations are therefore subject to disruption from natural or human causes beyond its control, including risks from hurricanes, severe storms, floods, heat waves, other forms of severe weather, wildfires, sea level rise, ambient temperature increases, war or other military conflicts such as the ongoing conflicts in Ukraine, Israel and the Gaza Strip, recent events in Venezuela, accidents, civil unrest, global political events, fires, earthquakes, and epidemic or pandemic diseases such as the COVID-19 pandemic, some of which may be impacted by climate change and any of which could result in suspension of operations or harm to people or the natural environment.
If any downstream pipeline were to become unavailable for current or future volumes due to repairs, damage to the facility, force majeure, lack of capacity, shut in by regulators, failure to meet quality requirements or any other reason, the Company’s ability to operate efficiently and continue shipping crude oil, natural gas and refined products to major demand centers could be restricted, thereby reducing revenue.
If any downstream pipeline were to become unavailable for current or future volumes due to 14 Table of Contents Index to Financial Statements repairs, damage to the facility, force majeure, lack of capacity, shut in by regulators, failure to meet quality requirements or any other reason, the Company’s ability to operate efficiently and continue shipping crude oil, natural gas and refined products to major demand centers could be restricted, thereby reducing revenue.
Ineffective internal controls could also cause investors to lose confidence in the Company’s reported financial information, which would likely have a negative effect on the trading price of its equity interests. 22 Table of Contents Index to Financial Statements If the performance of the Company does not meet the expectations of investors, stockholders or financial analysts, the market price of the Company’s securities may decline.
Ineffective internal controls could also cause investors to lose confidence in the Company’s reported financial information, which would likely have a negative effect on the trading price of its equity interests. If the performance of the Company does not meet the expectations of investors, stockholders or financial analysts, the market price of the Company’s securities may decline.
The Company currently generates revenues pursuant to a variety of different contractual arrangements, including fee-based agreements based on volumetric fees and percent-of-proceeds arrangements based on a percent of the proceeds from the sale of gathering and processing outputs on behalf of a producer and percent-of-products arrangements in which the Company is assigned a portion of the natural gas it gathers and processes as partial compensation.
The Company currently generates revenues pursuant to a variety of different contractual arrangements, including fee-based agreements based on volumetric fees and percent-of-proceeds arrangements based on a percent of the proceeds from the sale of gathering and processing outputs on behalf of a producer and percent-of-products arrangements in which the Company 15 Table of Contents Index to Financial Statements is assigned a portion of the natural gas it gathers and processes as partial compensation.
The Company has ownership interests in several joint ventures, including the PHP, Breviloba and EPIC joint ventures, which were accounted for using the equity interest method, and it may enter into other joint venture arrangements in the future.
The Company has ownership interests in several joint ventures, including the PHP and Breviloba joint ventures (together, the “EMI Pipelines”), which were accounted for using the equity interest method, and it may enter into other joint venture arrangements in the future.
These developments could result in additional regulation and restrictions on the Company’s use of injection wells to dispose of produced water, including a possible shut down of wells, which could materially and adversely affect its business, financial condition, and results of operations.
These developments could result in additional regulation and restrictions on the Company’s use of injection wells to dispose of produced water, including a possible shut down of wells, which could materially and adversely affect its business, financial condition, and results of 19 Table of Contents Index to Financial Statements operations.
The interests of Blackstone or I Squared Capital may not align with the interests of the Company’s other stockholders. Potential future sales pursuant to registration rights granted by the Company and under Rule 144 may depress the market price for our shares of Class A Common Stock.
The interests of Blackstone or I Squared Capital may not align with the interests of the Company’s other stockholders. 21 Table of Contents Index to Financial Statements Potential future sales pursuant to registration rights granted by the Company and under Rule 144 may depress the market price for our shares of Class A Common Stock.
The regulations require operators, including the Company, to: • perform ongoing assessments of pipeline integrity; • identify and characterize applicable threats to pipeline segments that could impact an HCA; • improve data collection, integration and analysis; • repair and remediate pipelines as necessary; and • implement preventive and mitigating actions.
The regulations require operators, including the Company, to: • perform ongoing assessments of pipeline integrity; • identify and characterize applicable threats to pipeline segments that could impact an HCA; • improve data collection, integration and analysis; 18 Table of Contents Index to Financial Statements • repair and remediate pipelines as necessary; and • implement preventive and mitigating actions.
The Company has granted a number of its stockholders, including Blackstone and I Squared Capital, registration rights with respect to their shares of Class A Common Stock, including shares of Class A Common Stock issuable upon redemption of Common Units.
The Company has granted a number of its stockholders, including Blackstone, registration rights with respect to their shares of Class A Common Stock, including shares of Class A Common Stock issuable upon redemption of Common Units.
In addition, under Rule 144 under the Securities Act, a person who has satisfied a minimum holding period of between six months and one year and any other applicable requirements of Rule 144, may thereafter sell such shares in 21 Table of Contents Index to Financial Statements transactions exempt from registration.
In addition, under Rule 144 under the Securities Act, a person who has satisfied a minimum holding period of between six months and one year and any other applicable requirements of Rule 144, may thereafter sell such shares in transactions exempt from registration.
We are subject to various complex and evolving U.S. federal, state and local tax laws. U.S. federal, state and local tax laws, policies, statutes, rules, regulations or ordinances could be interpreted, changed, modified or applied adversely to us, in each case, possibly with retroactive effect.
U.S. federal, state and local tax laws, policies, statutes, rules, regulations or ordinances could be interpreted, changed, modified or applied adversely to us, in each case, possibly with retroactive effect.
Accordingly, the Stock Buyback Tax will apply to our stock repurchase program, provided, that the amount of stock repurchases in the relevant taxable year subject to the Stock Buyback Tax is reduced by the fair market value of any stock issued by us during such taxable year, including the fair market value of any stock issued or provided to our employees or specified affiliates.
However, the amount of stock repurchases in the relevant taxable year subject to the Stock Buyback Tax is reduced by the fair market value of any stock issued by us during such taxable year, including the fair market value of any stock issued or provided to our employees or specified affiliates.
Any significant variance in our interpretation of current tax laws or a successful 17 Table of Contents Index to Financial Statements challenge of one or more of our tax positions by the IRS or other tax authorities could increase our future tax liabilities and adversely affect our operating results and cash flows.
Any significant variance in our interpretation of current tax laws or a successful challenge of one or more of our tax positions by the Internal Revenue Service or other tax authorities could increase our future tax liabilities and adversely affect our operating results and cash flows.
One or more 20 Table of Contents Index to Financial Statements of these developments could materially and adversely affect the Company’s business, financial condition and results of operation. Increasing attention to sustainability-related matters and conservation measures may adversely impact the Company’s business.
One or more of these developments could materially and adversely affect the Company’s business, financial condition and results of operations. Increased attention to sustainability-related matters and conservation measures may adversely impact the Company’s business.
The use of mobile communication devices has increased rapidly. Industrial control systems such as SCADA (supervisory control and data acquisition) now control large scale processes that can include multiple sites and long distances, such as crude oil and natural gas pipelines.
Industrial control systems such as SCADA (supervisory control and data acquisition) now control large scale processes that can include multiple sites and long distances, such as crude oil and natural gas pipelines.
While capital investment reviews and decisions incorporate potential ranges of physical risks such as winter storm severity and frequency, air and water temperature, precipitation, among other factors, it is difficult to predict with certainty the timing, frequency or severity of such events, any of which could have a material adverse effect on the company's results of operations or financial condition.
While capital investment reviews and decisions incorporate potential ranges of physical risks such as winter storm severity and frequency, air and water temperature, precipitation, among other factors, it is difficult to predict with certainty the timing, frequency or severity of such events, any of which could have a material adverse effect on the company's results of operations or financial condition. 24 Table of Contents Index to Financial Statements Cybersecurity breaches of our IT systems could result in information theft, data corruption, operational disruption and/or financial loss.
Changes in estimates or assumptions or the information underlying the assumptions, such as changes in the Company’s business plans, 24 Table of Contents Index to Financial Statements general market conditions, or changes in the Company’s outlook on commodity prices, could affect reported amounts of assets, liabilities or expenses.
Changes in estimates or assumptions or the information underlying the assumptions, such as changes in the Company’s business plans, general market conditions, litigation settlement or outcomes or changes in the Company’s outlook on commodity prices, could materially affect reported amounts of assets, liabilities or expenses.
As the Company builds infrastructure to meet its customers’ needs, it may not be able to complete such projects on schedule, at the budgeted cost, or at all. The Company’s revenues may not increase immediately (or at all) upon the expenditure of funds on a particular project.
As the Company builds infrastructure to meet its customers’ needs, it may not be able to complete such projects on schedule, at the budgeted cost, or at all.
The Company’s construction of new midstream assets may be subject to new or additional regulatory, environmental, political, contractual, legal and economic risks, which could materially and adversely affect its cash flows, results of operations and financial condition.
The Company’s construction of new midstream assets may not be completed on schedule, at the budgeted cost or at all, may not operate as designed or at the expected levels, may not result in revenue increases and may be subject to new or additional regulatory, environmental, political, contractual, legal and economic risks, all of which could materially and adversely affect its cash flows, results of operations and financial condition.
This regulatory oversight can affect certain aspects of the Company’s business and the market for its products and could materially and adversely affect the Company’s financial position, results of operations and cash flows. Changes to applicable tax laws and regulations or exposure to additional income tax liabilities could adversely affect our operating results and cash flows.
This regulatory oversight can affect certain aspects of the Company’s business and the market for its products and could materially and adversely affect the Company’s financial position, results of operations and cash flows.
In addition, competition could intensify the negative impact of factors that decrease demand for crude oil, natural gas and produced water services in the markets served by its systems, such as adverse economic conditions, weather, higher fuel costs and taxes or other governmental or regulatory actions that directly or indirectly increase the cost or reduce demand for its services. 15 Table of Contents Index to Financial Statements The Company’s exposure to commodity price risk may change over time and the Company cannot guarantee the terms of any existing or future agreements for its midstream services with its customers.
In addition, competition could intensify the negative impact of factors that decrease demand for crude oil, natural gas and produced water services in the markets served by its systems, such as adverse economic conditions, weather, higher fuel costs and taxes or other governmental or regulatory actions that directly or indirectly increase the cost or reduce demand for its services.
The U.S Federal Reserve decided to hold interest rates steady during its January 2025 Federal Open Market Committee (“FOMC”) meeting and gave little indication of what will come next for interest rates.
Federal Reserve starting in October 2025; however, the FOMC decided to hold interest rates steady at 3.50% - 3.75% during its January 2026 FOMC meeting and gave little indication of what will come next for interest rates.
Cybersecurity breaches of our IT systems could result in information theft, data corruption, operational disruption and/or financial loss. The oil and gas industry has become increasingly dependent on digital technologies to conduct day-to-day operations including certain midstream activities. For example, software programs are used to manage gathering and transportation systems and for compliance reporting.
The oil and gas industry has become increasingly dependent on digital technologies to conduct day-to-day operations including certain midstream activities. For example, software programs are used to manage gathering and transportation systems and for compliance reporting. The use of mobile communication devices has increased rapidly.
Joint venture arrangements may also restrict the Company’s operational and organizational flexibility and its ability to manage risk, which could materially and adversely affect the Company’s financial condition, results of operations and cash flows. 14 Table of Contents Index to Financial Statements If the third-party pipelines interconnected, or at some future point expected to be interconnected, to the Company’s pipelines become unavailable to transport or store crude oil, NGLs or natural gas, or if our cost of transporting on such third-party pipelines changes, the Company’s revenue and available cash could be adversely affected.
If the third-party pipelines interconnected, or at some future point expected to be interconnected, to the Company’s pipelines become unavailable to transport or store crude oil, NGLs or natural gas, or if our cost of transporting on such third-party pipelines changes, the Company’s revenue and available cash could be adversely affected.
Further, should the Company fail to comply with PHMSA or comparable state regulations, it could be subject to substantial fines and penalties. 18 Table of Contents Index to Financial Statements Increased regulation of hydraulic fracturing could result in reductions or delays in crude oil and natural gas production by the Company’s customers, which could reduce the throughput on its gathering and other midstream systems, which could adversely impact its revenues.
Increased regulation of hydraulic fracturing could result in reductions or delays in crude oil and natural gas production by the Company’s customers, which could reduce the throughput on its gathering and other midstream systems, which could adversely impact its revenues.
Furthermore, additional regulations and restrictions on the use of injection wells could indirectly result in reduced gas gathering and processing volumes and / or crude gathering volumes from the Company’s customers, which could materially and adversely affect its business, financial condition, and results of operations. 19 Table of Contents Index to Financial Statements The Company may incur significant liability under, or costs and expenditures to comply with, health, safety and environmental laws and regulations, which are complex and subject to frequent change.
Furthermore, additional regulations and restrictions on the use of injection wells could indirectly result in reduced gas gathering and processing volumes and / or crude gathering volumes from the Company’s customers, which could materially and adversely affect its business, financial condition, and results of operations.
If the Company fails to maintain an effective system of internal controls, it may not be able to report accurately its financial results or prevent fraud. As a result, current and potential holders of the Company’s equity could lose confidence in its financial reporting, which would harm its business and cost of capital.
As a result, current and potential holders of the Company’s equity could lose confidence in its financial reporting, which would harm its business and cost of capital. Effective internal controls are necessary for the Company to provide reliable financial reports, prevent fraud, and operate successfully as a public company.
Accordingly, the charter provides that the exclusive forum provision will not apply to suits brought to enforce any liability or duty created by the Exchange Act, the Securities Act or any other claim for which the federal courts have exclusive jurisdiction.
Accordingly, the charter provides that the exclusive forum provision will not apply to suits brought to enforce any liability or duty created by the Exchange Act, the Securities Act or any other claim for which the federal courts have exclusive jurisdiction. 22 Table of Contents Index to Financial Statements If the Company fails to maintain an effective system of internal controls, it may not be able to report accurately its financial results or prevent fraud.
In addition, sustainability efforts related to employment practices and social initiatives are the subject of scrutiny by stakeholders, regulators and other third parties. In light of the sustainability-linked features governing certain of our debt agreements, among other factors, we cannot be certain of the impact of such regulatory, legal and other developments on our business.
There is also risk of criticism or litigation from certain “anti-ESG” stakeholders, including various governmental agencies, related to our sustainability and social responsibility initiatives. In light of the sustainability-linked features governing certain of our debt agreements, among other factors, we cannot be certain of the impact of such regulatory, legal and other developments on our business.
Inflation pressure has resulted in and may result in additional increases to the costs of the Company’s services and personnel, which in turn cause the Company’s capital expenditures and operating costs to rise and impact the Company’s financial and operating results adversely. The Company’s operations could be disrupted by natural or human causes beyond its control.
Inflation pressure has resulted in and may result in additional increases to the costs of the Company’s services and personnel, which in turn cause the Company’s capital expenditures and operating costs to rise and impact the Company’s financial and operating results adversely. 23 Table of Contents Index to Financial Statements Our business and results of operations may be adversely affected by uncertainty and changes in U.S. trade policies, including tariffs, trade agreements or other trade restrictions imposed by the U.S. or other governments.
Furthermore, the IRA provides for the imposition of a 1% non-deductible U.S. federal excise tax (the “Stock Buyback Tax”) on certain repurchases of stock by publicly traded U.S. corporations such as us after December 31, 2022.
Furthermore, a 1% non-deductible U.S. federal excise tax (the “Stock Buyback Tax”) will apply to repurchases of stock made under our stock repurchase program.
Removed
Due to these and other factors, even if reserves are known to exist in areas served by the Company’s midstream assets, producers may choose not to develop those reserves.
Added
Joint venture arrangements may also restrict the Company’s operational and organizational flexibility and its ability to manage risk, which could materially and adversely affect the Company’s financial condition, results of operations and cash flows.
Removed
Although it is not possible at this time to predict how legislation or new regulations that may be adopted to address GHG emissions and climate change could impact our business, any such future laws and regulations could have a material adverse effect on our business, demand for our services, financial condition, results of operations and cash flows.
Added
The Company’s exposure to commodity price risk may change over time and the Company cannot guarantee the terms of any existing or future agreements for its midstream services with its customers.
Removed
Further, recent executive orders by the Trump Administration have indicated that the U.S. government intends to encourage the private sector to terminate previously adopted diversity, equity and inclusion ("DEI") initiatives. In light of the sustainability-linked features governing certain of our indebtedness, among other factors, we cannot be certain of the impact of such orders on our business.
Added
The construction of new energy infrastructure is inherently subject to the risks of cost overruns, including due to inflation or the imposition of tariffs on foreign-made materials and goods (including steel and steel pipes), and delays.
Removed
Effective internal controls are necessary for the Company to provide reliable financial reports, prevent fraud, and operate successfully as a public company.
Added
If we undertake these projects, we may not be able to complete them on schedule, at the budgeted cost or at all, or they may not operate as designed or at the expected levels. Moreover, the Company’s revenues may not increase immediately (or at all) upon the expenditure of funds on a particular project.
Removed
Although inflation has moderated in 2024 with an annual average consumer price index (“CPI”) of 2.9% compared to that of 4.1% in 2023, the inflation rate has risen slightly during the fourth quarter in 2024. In addition, potential policy shifts in tariff, immigration, and fiscal policy with the Trump Administration might cause additional inflationary pressures to the economy.
Added
Our future tax liability may be greater than expected if we are unable to fully utilize our net operating loss (“NOL”) carryforwards due to existing or additional limitations, we do not generate expected deductions, or tax authorities successfully challenge certain of our tax positions.
Removed
Moderated inflation has led to multiple interest rates cut by the U.S. Federal Reserve starting in September 2024; however, the slight rise in inflation during fourth quarter of 2024, consumer perception of potential tariffs to be imposed on imports and potential policy shifts by the Trump Administration continue to cast uncertainty to monetary policy.
Added
As of December 31, 2025, we have deferred assets related to NOL carryforwards of $139.4 million, which do not expire under current tax laws. We expect to be able to utilize these NOL carryforwards and generate deductions to offset a portion of our future taxable income.
Removed
Kinetik operates in both urban areas and remote areas.
Added
This expectation is based upon assumptions we have made regarding, among other things, our income, capital expenditures and net working capital, and our ability to utilize our NOL carryforwards within the annual limitations imposed under Section 382 of the IRC of 1986, as amended.
Removed
The technologies needed to conduct midstream activities make certain information the target of theft or misappropriation.
Added
While we expect to be able to utilize substantially all of 17 Table of Contents Index to Financial Statements our NOL carryforwards and generate deductions to offset a portion of our future taxable income, in the event that deductions are not generated as expected, one or more of our tax positions are successfully challenged by the Internal Revenue Service (in a tax audit or otherwise), our NOL carryforwards are further limited due to a subsequent ownership change, or we are otherwise unable to fully utilize our NOL carryforwards within the annual limitations currently in effect, our future tax liability may be greater than expected.
Added
Changes to applicable tax laws and regulations or exposure to additional income tax liabilities could adversely affect our operating results and cash flows. We are subject to various complex and evolving U.S. federal, state and local tax laws.
Added
Further, should the Company fail to comply with PHMSA or comparable state regulations, it could be subject to substantial fines and penalties.
Added
The Company may incur significant liability under, or costs and expenditures to comply with, health, safety and environmental laws and regulations, which are complex and subject to frequent change.
Added
In addition, failure or a perception of failure (whether or not valid) to pursue or implement sustainability strategies or achieve (or make progress against) sustainability goals or commitments could result in private litigation and damage to our reputation.
Added
In addition, sustainability efforts related to employment practices and social initiatives are the subject of scrutiny by stakeholders, regulators and other third parties, and the complex regulatory and legal frameworks applicable to such initiatives continue to evolve.
Added
Although inflation has moderated in 2025, with an annual average consumer price index (“CPI”) of 2.6% compared to that of 2.9% in 2024, the FOMC is attentive to its dual mandate and seeks to achieve maximum employment and inflation at the rate of 2.0% over the longer run. Moderated inflation has led to multiple interest rate cuts by the U.S.
Added
Our business and results of operations may be adversely affected by uncertainty and changes in U.S. trade policies, including tariffs, trade agreements or other trade restrictions imposed by the U.S. or other governments. For example, effective on June 4, 2025, the U.S. government imposed a 50% tariff on steel and aluminum imports except on imports from the U.K.
Added
Several tariff announcements have been followed by announcements of limited exemptions and temporary pauses. On February 20, 2026, the Supreme Court struck down the bulk of President Trump's sweeping tariffs, ruling that the administration overstepped its authority by using the International Emergency Economic Powers Act (IEEPA) to impose them.
Added
Hours after the ruling, President Trump signed an executive order for a new 10% global import duty using Section 122 of the Trade Act of 1974. These actions have caused substantial uncertainty and volatility in financial markets and may result in retaliatory measures on U.S. goods.
Added
Retaliatory measures might affect export of oil and gas products and have an adverse impact on domestic production and prices, which might affect our results of operations adversely. Our business requires access to steel and other materials to construct and maintain our pipelines and other midstream assets.
Added
Imposition of, or increase in, tariffs on imports of steel or other materials, as well as corresponding price increases for such materials available domestically, could increase our construction costs and our costs to maintain our assets.
Added
To the extent that we are unable to pass all or any such cost increases on to our customers, such cost increases could adversely affect our returns on investment. Higher material costs could also diminish our ability to develop new projects at acceptable returns, particularly during times of economic uncertainty, and limit our ability to pursue growth opportunities.
Added
Tariffs or other trade restrictions may lead to continuing uncertainty and volatility in U.S. and global financial and economic conditions and commodity markets, declining consumer confidence, significant inflation and diminished expectations for the economy, and ultimately reduced demand for our and our customers’ products and services.
Added
Such conditions could have a material adverse impact on our business, results of operations and cash flows. Also, disruptions and volatility in the financial markets may lead to adverse changes in the availability, terms and cost of capital. Changes in tariffs and trade restrictions can be announced with little or no advance notice.
Added
The adoption and expansion of tariffs or other trade restrictions, increasing trade tensions, or other changes in governmental policies related to taxes, tariffs, trade agreements or policies, are difficult to predict, which makes attendant risks difficult to anticipate and mitigate.
Added
If we are unable to navigate further changes in U.S. or international trade policy, it could have a material adverse impact on our business and results of operations. The Company’s operations could be disrupted by natural or human causes beyond its control. Kinetik operates in both urban areas and remote areas.
Added
The technologies needed to conduct midstream activities make certain information the target of theft or misappropriation. In addition, the Company has begun to incorporate certain algorithmic technologies into its business activities. As with many technological innovations, the use presents risks and challenges associated with developing, deploying and governing such technologies that could adversely impact the Company’s business.
Added
The legal and regulatory landscape surrounding certain advanced technologies, including the use of artificial intelligence “AI” is rapidly evolving and uncertain, and may expose the Company to additional compliance costs, cybersecurity risks, and lawsuits.

… 1 more changes not shown on this page.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

12 edited+4 added−2 removed13 unchanged
Biggest changeThis Policy is based on the NIST requirements. Risk Assessment: We conduct assessments across our systems, networks, and data infrastructure to identify, assess and manage potential and material cybersecurity threats and vulnerabilities. These assessments include penetration testing, vulnerability scans, cybersecurity audits, incident response planning, vendor risk assessments, and regulatory compliance assessments.
Biggest changeCybersecurity is integrated into our risk management framework and the Company has established IT policies supported by underlying processes to execute and meet the Company’s risk management objectives. Risk Assessment: We conduct assessments across our systems, networks, and data infrastructure to identify, assess and manage potential and material cybersecurity threats and vulnerabilities.
We deploy quarterly simulated phishing emails to all system users in an effort to gauge their cybersecurity awareness. Access Controls: Users are provided with access consistent with the principle of least privilege, which requires that users be given no more access than necessary to complete their job functions.
We also deploy quarterly simulated phishing emails to all system users in an effort to gauge their cybersecurity awareness. Access Controls: Users are provided with access consistent with the principle of least privilege, which requires that users be given no more access than necessary to complete their job functions.
See “Risk Factors” in Part I—Item 1A of this Annual 26 Table of Contents Index to Financial Statements Report for additional information about the risks to our business associated with a breach or other compromise to our information and operational technology systems.
See “Risk Factors” in Part I—Item 1A of this Annual Report for additional information about the risks to our business associated with a breach or other compromise to our information and operational technology systems. 27 Table of Contents Index to Financial Statements
We have endeavored to implement policies, standards, and technical controls based on external cybersecurity standards, such as National Institute of Standards and Technology (“NIST”) and ISO frameworks. Like others in our industry, we are reliant on the continuous and uninterrupted operation of our various technology systems.
We have endeavored to implement policies, standards, and technical controls based on external cybersecurity standards, such as National Institute of Standards and Technology (“NIST”) framework and ISO standards. Like others in our industry, we are reliant on the continuous and uninterrupted operation of our various technology systems.
Our Audit Committee oversees management’s assessment and management of cybersecurity risk. Our Senior IT Director, who reports to our Executive Vice President, Chief Administrative and Accounting Officer, leads the Information Technology team, is a member of our management-level Cybersecurity Governance Committee and management-level Cybersecurity Risk Committee and manages our information technology and cybersecurity function.
Our Senior IT Director, who reports to our Executive Vice President, Chief Administrative and Accounting Officer, leads the Information Technology team, is a member of our management-level Cybersecurity Governance Committee and management-level Cybersecurity Risk Committee and manages our information technology and cybersecurity function.
To keep our network secure, we have multifactor authentication (MFA) for all users, a password change policy, separation of duties in accounting systems, controlled access to network drives, endpoint protection, email security, mobile device management, device encryption, and ongoing active monitoring of threats.
To keep our network secure, we have multifactor authentication (MFA) 26 Table of Contents Index to Financial Statements for all users, a password change policy, separation of duties in accounting systems, controlled access to network drives, endpoint protection, email security, mobile device management, device encryption, and ongoing active monitoring of threats.
Cybersecurity Training and Awareness: At Kinetik, we believe that the recognition and reporting of cybersecurity threats by every employee and contractor plays a key role in protecting and securing our network. We have mandatory annual training for our employees and contractors on 25 Table of Contents Index to Financial Statements security awareness annually, using a library of cybersecurity training modules.
Cybersecurity Training and Awareness: At Kinetik, we believe that the recognition and reporting of cybersecurity threats by every employee and contractor plays a key role in protecting and securing our network. We conduct mandatory annual training for our employees and contractors on security awareness, using a library of cybersecurity training modules.
All potential security events and/or confirmed security incidents, as appropriate, are reported and logged in to the Company’s authorized incident management systems. The Company’s incident response team (“IRT”), along with the third-party security system providers, aims to review, analyze, categorize and take action on reported security events.
Monitoring and detection systems have been implemented to help identify and remediate cybersecurity threats. All potential security events and/or confirmed security incidents, as appropriate, are reported and logged into the Company’s authorized incident management systems. The Company’s incident response team (“IRT”), along with the third-party security system providers, aims to review, analyze, categorize and take action on reported security events.
Before engaging with any third-party service provider, we aim to conduct due diligence to evaluate their cybersecurity capabilities. Additionally, we endeavor to include cybersecurity requirements in our contracts with these providers and endeavor to require them to adhere to specific security standards and protocols. The Board’s Oversight and Management’s Role Our Board has delegated the responsibility for overseeing cybersecurity risk.
Before engaging with any third-party service provider, we aim to conduct due diligence to evaluate their cybersecurity capabilities. Additionally, we endeavor to include cybersecurity requirements in our contracts with these providers and endeavor to require them to adhere to specific security standards and protocols.
We use various processes and tools, including third-party cybersecurity tools and technologies, to aid us in seeking to secure and protect our network perimeter and internal systems from unauthorized access, intrusion, or disruption, including those processes described below. Kinetik has an established risk management policy supported by underlying processes to execute and meet the Company’s risk management objectives.
We use various processes and tools, including third-party cybersecurity tools and technologies, to aid us in seeking to secure and protect our network perimeter and internal systems from unauthorized access, intrusion, or disruption, including those processes described below.
Feedback from these assessments is incorporated into our systems and procedures through upgrades intended to further improve our cybersecurity posture. Incident Identification and Response: The Company has established a cybersecurity incident management policy to facilitate the Company’s management of cybersecurity incidents. Monitoring and detection systems have been implemented to help identify and remediate cybersecurity threats.
These assessments include penetration testing, vulnerability scans, cybersecurity audits, incident response planning, vendor risk assessments, and regulatory compliance assessments. Feedback from these assessments is incorporated into our systems and procedures through upgrades intended to further improve our cybersecurity posture. Incident Identification and Response: The Company has established a cybersecurity incident management policy to facilitate the Company’s management of cybersecurity incidents.
A Cybersecurity Dashboard is used to share metrics and matters needing Board attention in Audit Committee meetings. The Cybersecurity Dashboard also includes commentaries on risk exposure and materiality, if any, as they relate to cybersecurity.
A Cybersecurity Dashboard is used to share metrics and matters needing Board attention in Audit Committee meetings. The Cybersecurity Dashboard also includes commentaries on risk exposure and materiality, if any, as they relate to cybersecurity. Our Senior IT Director brings more than 16 years of specialized experience in the oil and gas industry, with deep expertise in infrastructure and cybersecurity.
Removed
Our executive team, in particular, our Senior IT Director and members of our IRT, have relevant degrees in computer information systems and extensive experience and background in network design and configuration, endpoint protection, privileged identity management, device encryption, cloud network and infrastructure, cloud email security, security information and event management (SIEM), and vulnerability assessments.
Added
The Board’s Oversight and Management’s Role Our Board has delegated the responsibility for overseeing cybersecurity risk to our Audit Committee. Our Audit Committee oversees management’s assessment and management of cybersecurity risk.
Removed
This combined expertise is important to our cybersecurity risk management processes.
Added
He has over eight years of proven IT leadership, where he has successfully spearheaded major digital transformation programs, accelerated cloud adoption strategies, elevated cybersecurity maturity, and managed complex, large-scale system implementations and integrations. He holds a Bachelor of Science in Computer Information Systems from the University of Houston.
Added
Our dedicated IT team is responsible for ensuring compliance with relevant cybersecurity standards, establishing robust protocols, and safeguarding the integrity, confidentiality, and availability of the organization's IT infrastructure. Collectively, the team possesses over 40 years of IT experience, including more than 20 years focused specifically on cybersecurity.
Added
The IT team is also responsible for ensuring the entire Kinetik workforce receives annual training to stay on top of cybersecurity risks facing our industry today.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed0 unchanged
Biggest changeITEM 3. LEGAL PROCEEDINGS For further information regarding legal proceedings, see Note 17—Commitments and Contingencies in the Notes to Consolidated Financial Statements set forth in Part IV, Item 15 of this Annual Report. 27 Table of Contents Index to Financial Statements PART II
Biggest changeITEM 3. LEGAL PROCEEDINGS For further information regarding legal proceedings, see Note 17—Commitments and Contingencies in the Notes to Consolidated Financial Statements set forth in Part IV, Item 15 of this Annual Report. 28 Table of Contents Index to Financial Statements PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

6 edited+3 added−3 removed5 unchanged
Biggest changeThe Repurchase Program allowed us to reduce dilution and potentially acquire shares at levels that we believe do not reflect the fundamental earnings power of the Company. Repurchases may be made at management’s discretion from time-to-time throughout the year, in accordance with applicable securities laws on the open market, a trading plan, or through privately negotiated transactions.
Biggest changeRepurchases may be made at management’s discretion from time to time, in accordance with applicable securities laws, on the open market or through privately negotiated transactions and may be made pursuant to a trading plan meeting the requirements of Rule 10b5-1 under the Exchange Act.
Midstream Energy Index during the period beginning on December 31, 2019 and ending on December 31, 2024. The NASDAQ Composite Index was included here as the Company’s Class A Common Stock was traded on NASDAQ prior to switching to NYSE in October 2022.
Midstream Energy Index during the period beginning on December 31, 2020 and ending on December 31, 2025. The NASDAQ Composite Index was included here as the Company’s Class A Common Stock was traded on NASDAQ prior to switching to NYSE in October 2022.
(2) $100 invested on 12/31/2019 in index, including reinvestment of dividends.
(2) $100 invested on 12/31/2020 in index, including reinvestment of dividends.
ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information The Company’s Class A Common Stock is traded on the NYSE under the symbol “KNTK”. On February 21, 2025, the Class A Common Stock had a closing price of $59.03.
ITEM 5. MARKET FOR THE REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information The Company’s Class A Common Stock is traded on the NYSE under the symbol “KNTK”. On February 20, 2026, the Class A Common Stock had a closing price of $45.56.
Holders On February 21, 2025, there were 191 holders of record of the Company’s Class A Common Stock and eight holders of record of the Company’s Class C Common Stock, par value $0.0001 per share (“Class C Common Stock”).
Holders On February 20, 2026, there were 138 holders of record of the Company’s Class A Common Stock and eight holders of record of the Company’s Class C Common Stock, par value $0.0001 per share (“Class C Common Stock”).
For more information regarding the non-deductible 1% U.S. federal excise tax imposed on certain repurchases of stock by publicly traded U.S. corporations, please refer to Part I—Item 1A Risk Factors—Risks Related to Ownership of our Common Stock . 28 Table of Contents Index to Financial Statements Performance Graph The graph and table below compares the Company’s cumulative return to holders of its common stock, the NASDAQ Composite Index, the NYSE Composite Index and the Alerian U.S.
(2) Average price paid per share includes commission to repurchase shares. 29 Table of Contents Index to Financial Statements Performance Graph The graph and table below compares the Company’s cumulative return to holders of its Common Stock, the NASDAQ Composite Index, the NYSE Composite Index and the Alerian U.S.
Removed
Recent Sales of Unregistered Securities None. Purchase of Equity Securities by the Issuer and Affiliated Purchasers In February 2023, the Board approved a stock repurchase program (“Repurchase Program”), authorizing discretionary purchases of the Company’s Class A Common Stock up to $100.0 million in the aggregate.
Added
Purchase of Equity Securities by the Issuer and Affiliated Purchasers The following table sets forth information with respect to repurchases made by the Company of its Class A Common Stock in the open market or in privately negotiated transactions under the $500.0 million Repurchase Program during the fourth quarter of 2025: Period Total Number of Shares Purchased (1) Average Price per Share (2) Total Number of Shares Purchased as Part of Publicly Announced Plan (1) Maximum number (or approximate dollar value) of Shares that May Yet be Purchased under the Plans (in thousands) (1) October 1 to October 31, 2025 91,252 $ 37.82 91,252 $ 318,238 November 1 to November 30, 2025 — $ — — $ 318,238 December 1 to December 31, 2025 — $ — — $ 318,238 (1) In February 2023, our Board approved the Stock Repurchase Program (“Repurchase Program”) for the repurchase of up to $100.0 million of our outstanding Class A Common Stock.
Removed
Except as already disclosed in the Company’s Current Report on From 8-K dated May 13, 2024, there were no repurchase activities during the three and twelve months ended December 31, 2024.
Added
In May 2025, our Board approved a $400.0 million increase to the previously announced Repurchase Program, pursuant to which we are authorized to repurchase the Company’s Class A Common Stock for an aggregate purchase price of up to $500.0 million.
Removed
December 31, 2019 2020 2021 2022 2023 2024 Kinetik Holdings Inc $ 100.00 $ 82.95 $ 118.28 $ 135.91 $ 137.22 $ 251.27 NYSE Composite Index 100.00 144.92 177.06 119.45 172.77 223.87 Nasdaq Composite Index 100.00 106.99 129.11 117.04 133.16 154.19 Alerian US Midstream Energy Index 100.00 75.04 108.82 140.99 168.00 253.24 29 Table of Contents Index to Financial Statements
Added
December 31, 2020 2021 2022 2023 2024 2025 Kinetik Holdings Inc $ 100.00 $ 142.60 $ 163.84 $ 165.43 $ 302.91 $ 206.14 NYSE Composite Index 100.00 122.18 82.43 119.22 154.48 187.14 NASDAQ Composite Index 100.00 120.68 109.39 124.46 144.12 169.62 Alerian US Midstream Energy Index 100.00 145.02 187.88 223.87 337.47 346.67

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

77 edited+47 added−51 removed23 unchanged
Biggest changeFor The Year Ended December 31, 2024 2023 % Change (In thousands, except percentage) Reconciliation of net income including noncontrolling interests to Adjusted EBITDA Net income including noncontrolling interests $ 244,233 $ 386,452 (37) % Add back: Interest expense 217,235 205,854 6 % Income tax (benefit) expense 23,035 (232,908) (110) % Depreciation and amortization expenses 324,197 280,986 15 % Amortization of contract costs 6,621 6,620 — % Proportionate EMI EBITDA 346,666 306,072 13 % Share-based compensation 76,536 55,983 37 % Loss on disposal of assets, net 4,040 19,402 (79) % Loss on debt extinguishment 525 1,876 (72) % Commodity hedging unrealized loss 10,788 — 100 % Contingent liabilities fair value adjustment 200 — 100 % Integration costs 5,826 1,015 NM Acquisition transaction costs 4,096 648 NM Other one-time cost and amortization 12,101 11,901 2 % Deduct: Interest income 1,988 677 194 % Warrant valuation adjustment — 88 (100) % Commodity hedging unrealized gain — 4,291 (100) % Gain on sale of equity method investment 89,802 — 100 % Equity income from unconsolidated affiliates 213,191 200,015 7 % Adjusted EBITDA $ 971,118 $ 838,830 16 % NM - Not meaningful Adjusted EBITDA increased by $132.3 million, or 16% to $971.1 million for the year ended December 31, 2024, compared to $838.8 million for the same period in 2023.
Biggest changeFor The Year Ended December 31, 2025 2024 % Change (In thousands, except percentage) Reconciliation of net income including noncontrolling interest to Adjusted EBITDA Net income including noncontrolling interest $ 525,928 $ 244,233 115 % Add back: Interest expense 233,371 217,235 7 % Income tax expense 50,728 23,035 120 % Depreciation and amortization expenses 382,645 324,197 18 % Amortization of contract costs 6,794 6,621 3 % Proportionate EMI EBITDA 339,448 346,666 (2) % Share-based compensation 62,617 76,536 (18) % Loss on disposal of assets, net 8 4,040 (100) % Loss on debt extinguishment 635 525 21 % Unrealized (gain) loss on derivatives (18,871) 10,788 NM Contingent liabilities fair value adjustment 5,190 200 NM Integration costs 14,958 5,826 157 % Acquisition transaction costs 275 4,096 (93) % Litigation costs 19,708 6,074 NM Other one-time cost and amortization 7,540 6,027 25 % Deduct: Other interest income 1,510 1,988 (24) % Gain on sale of equity method investment 415,409 89,802 NM Equity income from unconsolidated affiliates 226,351 213,191 6 % Adjusted EBITDA $ 987,704 $ 971,118 2 % NM - Not meaningful Adjusted EBITDA increased by $16.6 million, or 2% to $987.7 million for the year ended December 31, 2025, compared to $971.1 million for the same period in 2024.
Derivatives Instruments and Hedging Activities All our derivative contracts are recorded at estimated fair value. We utilize published prices, broker quotes, and estimates of market prices to estimate the fair value of these contracts; however, actual amounts could vary materially from estimated fair values as a result of changes in market prices.
Derivative Instruments and Hedging Activities All our derivative contracts are recorded at estimated fair value. We utilize published prices, broker quotes, and estimates of market prices to estimate the fair value of these contracts; however, actual amounts could vary materially from estimated fair values as a result of changes in market prices.
Adjusted EBITDA is not defined in GAAP The GAAP measure used by the Company that is most directly comparable to Adjusted EBITDA is net income including noncontrolling interests. Adjusted EBITDA should not be considered as an alternative to the GAAP measure of net income including noncontrolling interests or any other measure of financial performance presented in accordance with GAAP.
Adjusted EBITDA is not defined in GAAP The GAAP measure used by the Company that is most directly comparable to Adjusted EBITDA is net income including noncontrolling interests. Adjusted EBITDA should not be considered as an alternative to the GAAP measure of net income including noncontrolling interest or any other measure of financial performance presented in accordance with GAAP.
See Note 3—Business Combination in our Notes to the Consolidated Financial Statements in this Annual Report for more information regarding our valuation approach. Impairment of Long-lived Assets Long-lived assets used in operations are evaluated for potential impairment when events or changes in circumstances indicate a possible significant deterioration in future cash flows expected to be generated by an asset group.
See Note 3—Business Combinations in our Notes to the Consolidated Financial Statements in this Annual Report for more information regarding our valuation approach. Impairment of Long-lived Assets Long-lived assets used in operations are evaluated for potential impairment when events or changes in circumstances indicate a possible significant deterioration in future cash flows expected to be generated by an asset group.
An estimate of the sensitivity to changes in underlying assumptions of a fair value calculation is not practicable, given the numerous assumptions that can materially affect our estimates. Equity Method Investment We evaluate our EMIs for impairment when events or circumstances indicate that the carrying value of the EMI may be impaired and that impairment is other than temporary.
An estimate of the sensitivity to changes in underlying assumptions of a fair value calculation is not practicable, given the numerous assumptions that can materially affect our estimates. Equity Method Investments We evaluate our EMIs for impairment when events or circumstances indicate that the carrying value of the EMI may be impaired and that impairment is other than temporary.
Adjusted EBITDA has important limitations as an analytical tool because it excludes some, but not all, items that affect net income including noncontrolling interests. Adjusted EBITDA should not be considered in isolation or as a substitute for analysis of the Company’s results as reported under GAAP.
Adjusted EBITDA has important limitations as an analytical tool because it excludes some, but not all, items that affect net income including noncontrolling interest. Adjusted EBITDA should not be considered in isolation or as a substitute for analysis of the Company’s results as reported under GAAP.
Reconciliation of non-GAAP financial measure Company management compensates for the limitations of Adjusted EBITDA as an analytical tool by reviewing the comparable GAAP measure, understanding the differences between Adjusted EBITDA as compared to net income including noncontrolling interests, and incorporating this knowledge into its decision-making processes.
Reconciliation of non-GAAP financial measure Company management compensates for the limitations of Adjusted EBITDA as an analytical tool by reviewing the comparable GAAP measure, understanding the differences between Adjusted EBITDA as compared to net income including noncontrolling interest, and incorporating this knowledge into its decision-making processes.
Business Combination For acquired businesses, we recognize the identifiable assets acquired, the liabilities assumed and any noncontrolling interest in the acquiree at their estimated fair values on the date of acquisition with any excess purchase price over the fair value of net assets acquired recorded to goodwill.
Business Combinations For acquired businesses, we recognize the identifiable assets acquired, the liabilities assumed and any noncontrolling interest in the acquiree at their estimated fair values on the date of acquisition with any excess purchase price over the fair value of net assets acquired recorded to goodwill.
Our senior unsecured notes are fixed rate borrowings; however, we have some exposure to the risk of changes in interest rates, primarily as a result of the variable rate borrowings under the Revolving Credit Facility, the Term Loan Credit Facility and the A/R Facility.
Our senior unsecured notes are fixed rate borrowings; however, we have some exposure to the risk of changes in interest rates, primarily as a result of the variable rate borrowings under the Term Loan Credit Agreement, the Revolving Credit Agreement and the Amended A/R Facility.
Adjusted EBITDA is useful to an investor in evaluating our performance because this measure: • Is widely used by analysts, investors and competitors to measure a company’s operating performance; • Is a financial measurement that is used by rating agencies, lenders, and other parties to evaluate our credit worthiness; and • Is used by our management for various purposes, including as a measure of performance and as a basis for strategic planning and forecasting.
Adjusted EBITDA is useful to an investor in evaluating our performance because this measure: • Is widely used by analysts, investors and competitors to measure a company’s operating performance; • Is a financial measurement that is used by rating agencies, lenders, and other parties to evaluate our creditworthiness; and • Is used by our management for various purposes, including as a measure of performance and as a basis for strategic planning and forecasting.
Liquidity and Capital Resources The Company’s primary use of capital since inception has been for the initial construction of gathering and processing assets, as well as the acquisitions of businesses and EMI pipelines and associated subsequent construction costs.
Liquidity and Capital Resources The Company’s primary use of capital since inception has been for the initial construction of gathering and processing assets, as well as the acquisition of businesses and EMI pipelines and associated subsequent construction costs.
Discussions of 2022 items and year-to-year comparisons between 2023 and 2022 that are omitted in this Annual Report are incorporated by reference to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 , filed on March 5, 2024.
Discussions of 2023 items and year-to-year comparisons between 2024 and 2023 that are omitted in this Annual Report are incorporated by reference to “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 , filed on March 3, 2025.
Management believes that investors benefit from having access to the same financial measure that the Company uses in evaluating operating results. 37 Table of Contents Index to Financial Statements The following table presents a reconciliation of the GAAP financial measure of net income including noncontrolling interests to the non-GAAP financial measure of Adjusted EBITDA.
Management believes that investors benefit from having access to the same financial measure that the Company uses in evaluating operating results. 36 Table of Contents Index to Financial Statements The following table presents a reconciliation of the GAAP financial measure of net income including noncontrolling interest to the non-GAAP financial measure of Adjusted EBITDA.
Our product sales revenue is exposed to commodity price fluctuations. Therefore, commodity price decline and sustained periods of low natural gas and NGL prices could have an adverse effect on our product revenue stream. The Company continues to monitor commodity prices closely and may enter into commodity price hedges from time to time as necessary to mitigate the volatility risk.
Our product sales revenue is exposed to commodity price fluctuations. Therefore, commodity price decline and sustained periods of low natural gas, NGL, and condensate prices could have an adverse effect on our product revenue stream. The Company continues to monitor commodity prices closely and may enter into commodity price hedges to mitigate the volatility risk.
In particular, there are numerous and complex judgments and assumptions inherent in determining a valuation allowance, including factors such as future operating conditions and profitability. For more information, see Note 15—Income Taxes in our Notes to the Consolidated Financial Statements in this Annual Report. 43 Table of Contents Index to Financial Statements
In particular, there are numerous and complex judgments and assumptions inherent in determining a valuation allowance, including factors such as future operating conditions and profitability. For more information, see Note 15—Income Taxes in our Notes to the Consolidated Financial Statements in this Annual Report.
Stock Repurchase Program In February 2023, the Board approved the Repurchase Program, authorizing discretionary purchases of the Company’s Class A Common Stock up to $100.0 million in the aggregate.
Share Repurchase Program In February 2023, the Board approved a share repurchase program (“Repurchase Program”), authorizing discretionary purchases of the Company’s Class A Common Stock up to $100.0 million in the aggregate.
Over 98% of service revenues are included in the Midstream Logistics segment. 35 Table of Contents Index to Financial Statements Product revenue Product revenue consists of commodity sales (including condensate, natural gas residue and NGLs).
Over 97% of service revenues are included in the Midstream Logistics segment. 34 Table of Contents Index to Financial Statements Product revenue Product revenue consists of commodity sales (including condensate, natural gas residue and NGLs).
This section of this Annual Report generally discusses 2024 and 2023 items and year-to-year comparisons between 2024 and 2023.
This section of this Annual Report generally discusses 2025 and 2024 items and year-to-year comparisons between 2025 and 2024.
Under the Reinvestment Agreement, each Reinvestment Holder was obligated to reinvest at least 20% of all distributions on common units representing limited partner interests in the Partnership (“Common Units”) or dividends on shares of Class A Common Stock in the Company’s Class A Common Stock.
Under the Reinvestment Agreement, each Reinvestment Holder was obligated to reinvest at least 20% of all distributions on common units representing limited partner interests in the Partnership (“Common Units”) or dividends on shares of Class A Common Stock in the Company’s Class A Common Stock. The Reinvestment Agreement terminated automatically on March 8, 2024.
The Kinetik NGL Pipelines consist of approximately 96 miles of NGL pipelines connecting our East Toyah and Pecos complexes to Waha, including our 20-inch Dewpoint pipeline that spans 40 miles, and our 30 mile, 20-inch Brandywine Pipeline connecting to our Diamond Cryogenic complex. The Kinetik NGL pipeline system has a capacity approximate 580 MBbl/d. Delaware Link Pipeline.
The Kinetik NGL Pipeline System consists of approximately 96 miles of NGL pipelines connecting our East Toyah and Pecos complexes to Waha, including our 20-inch Dewpoint pipeline that spans over 40 miles, and our 28 mile, 20-inch Brandywine Pipeline connecting to our Diamond Cryogenic complex. The Kinetik NGL Pipeline System has a capacity of approximately 580 MBbl/d. Delaware Link Pipeline.
Key Performance Metrics Adjusted EBITDA Adjusted EBITDA is defined as net income including noncontrolling interests adjusted for interest, taxes, depreciation and amortization, gain or loss on disposal of assets and debt extinguishment, the proportionate EBITDA from our EMI pipelines, equity income and gain from sale of investments recorded using the equity method, share-based compensation expense, noncash increases and decreases related to hedging activities, fair value adjustments for contingent liabilities, integration and transaction costs and extraordinary losses and unusual or non-recurring charges.
Segment Adjusted EBITDA Segment Adjusted EBITDA is defined as segment net income or loss including noncontrolling interest adjusted for interest, taxes, depreciation and amortization, gain or loss on disposal of assets and debt extinguishment, the proportionate EBITDA from our EMI Pipelines, equity income and gain from sale of investments recorded using the equity method, share-based compensation expense, noncash increases and decreases related to commodity hedging activities, integration and transaction costs and extraordinary losses and unusual or non-recurring charges.
The Pipeline Transportation segment consists of three EMI pipelines originating in the Permian Basin with various access points to the U.S. Gulf Coast, Kinetik NGL Pipelines and Delaware Link Pipeline. The pipelines transport crude oil, natural gas and NGLs within the Permian Basin and to the U.S. Gulf Coast. Midstream Logistics Gas Gathering and Processing.
The Pipeline Transportation segment consists of two EMI Pipelines originating in the Permian Basin with various access points to the U.S. Gulf Coast and Mexico markets, as well as Kinetik NGL and Delaware Link Pipelines. The pipelines transport natural gas and NGLs within the Permian Basin and to the U.S. Gulf Coast. Midstream Logistics Gas Gathering and Processing.
During 2024, the Company made cash dividend payments of $396.0 million to holders of Class A Common Stock and Common Units and $75.6 million was reinvested in shares of Class A Common Stock by the Reinvestment Holders.
During 2024, the Company made cash dividend payments of $396.0 million to holders of Class A Common Stock and Common Units and $75.6 million was reinvested in shares of Class A Common Stock. The significant decrease in reinvestment in shares of Class A Common Stock was primarily driven by the termination of the Reinvestment Agreement in March 2024.
If, upon review, the sum of the undiscounted pre-tax cash flows is less than the carrying value of the asset 42 Table of Contents Index to Financial Statements group, the carrying value is written down to an estimated fair value.
If, upon review, the sum of the undiscounted pre-tax cash flows is less than the carrying value of the asset group, the carrying value is written down to an estimated fair value.
For 2024, the Company’s primary spending requirements were related to the business acquisitions and other budgeted capital expenditures for construction and maintenance of gathering and processing assets, the Company’s contractual debt obligations and quarterly cash dividends. In addition, the Company may repurchase its Class A Common Stock pursuant to the Share Repurchase Program from time to time.
For 2025, the Company’s primary spending requirements are related to business acquisitions and other budgeted capital expenditures for the construction and maintenance of gathering and processing assets, the Company’s contractual debt obligations, quarterly cash dividends and repurchases of its Class A Common Stock pursuant to the Repurchase Program from time to time.
In addition, changes in the methods used to determine the fair value of these contracts could have a material effect on our results of operations. We do not anticipate future changes in the methods used to determine the fair value of these derivative contracts.
In addition, changes in the methods used to determine the fair value of these contracts could have a material effect on our results of operations.
Based on the Company’s current financial plan, the Company believes that cash from operations and distributions from the EMI pipelines, and remaining borrowing capacity on our credit facilities will generate cash flows in excess of capital expenditures and the amount required to fund the Company’s planned quarterly dividend over the next 12 months. 39 Table of Contents Index to Financial Statements Long-term Financing From time to time, we issue long-term debt.
Based on the Company’s current financial plan, the Company believes that cash from operations and distributions from the EMI Pipelines and remaining borrowing capacity on our credit facilities will generate cash flows in excess of capital expenditures and the amount required to fund the Company’s planned quarterly dividend over the next 12 months.
Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations to this Annual Report, $226.5 million of the increase was due to increased total operating revenues, partially offset by increased cost of sales (exclusive of depreciation and amortization) of $104.9 million and an increase in operating expenses, ad valorem taxes and general and administrative expenses totaling of $73.8 million.
Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations to this Annual Report, $281.5 million of the increase was due to increased total operating revenues, partially offset by increased cost of sales (excluding depreciation and amortization expenses) of $165.3 million and an increase in operating expenses, ad valorem taxes and general and administrative expenses totaling $76.0 million.
During the year ended December 31, 2024, the Company’s primary sources of cash were distributions from the EMI pipelines, borrowings under the Revolving Credit Facility and the A/R Facility, proceeds from the GCX Sale and cash generated from operations.
During the year ended December 31, 2025, the Company’s primary sources of cash were distributions from the EMI Pipelines, borrowings under the revolving credit facility and the Amended A/R Facility, proceeds from the EPIC Sale and the issuance of the New 2028 Notes, and cash generated from operations.
Also refer to Note 19—Segments in the Notes to our Consolidated Financial Statements in this Annual Report for reconciliation of segment adjusted EBITDA to Income before income taxes. 38 Table of Contents Index to Financial Statements For The Year Ended December 31, 2024 2023 % Change (In thousands, except percentage) Midstream Logistics $ 614,883 $ 543,190 13 % Pipeline Transportation 377,550 311,106 21 % Corporate and Other* (21,315) (15,466) 38 % Total segment adjusted EBITDA $ 971,118 $ 838,830 16 % * Corporate and Other represents those results that: (i) are not specifically attributable to a reportable segment; (ii) are not individually reportable or (iii) have not been allocated to a reportable segment for the purpose of evaluating their performance, including certain general and administrative expense.
Also refer to Note 19—Segments in the Notes to our Consolidated Financial Statements in this Annual Report for reconciliation of segment adjusted EBITDA to Income before income taxes. 37 Table of Contents Index to Financial Statements For The Year Ended December 31, 2025 2024 % Change (In thousands, except percentage) Midstream Logistics $ 635,845 $ 614,883 3 % Pipeline Transportation 370,134 377,550 (2) % Corporate and Other (1) (18,275) (21,315) (14) % Total segment adjusted EBITDA $ 987,704 $ 971,118 2 % (1) Corporate and Other represents those results that: (i) are not specifically attributable to a reportable segment; (ii) are not individually reportable; or (iii) have not been allocated to a reportable segment for the purpose of evaluating their performance, including certain general and administrative expense items.
Privately negotiated repurchases from affiliates are also authorized under the Repurchase Program, subject to such affiliates’ interest and other limitations. The repurchases will depend on market conditions and may be discontinued at any time without prior notice. During the year ended December 31, 2024, the Company did not repurchase any of its outstanding shares.
Privately negotiated repurchases from affiliates are also authorized under the Repurchase Program, subject to such affiliates’ interest and other limitations. The repurchases will depend on market conditions and may be discontinued at any time without prior notice. During the year ended December 31, 2025, the Company repurchased 4.1 million shares at a total cost of $176.0 million.
Operating Costs and Expenses Costs of sales (exclusive of depreciation and amortization) Cost of sales (exclusive of depreciation and amortization) primarily consists of purchases of NGLs and natural gas from our producers at contracted market prices to support product sales to other third parties.
Product revenues are included entirely in the Midstream Logistics segment. Operating Costs and Expenses Costs of sales (excluding depreciation and amortization expenses) Cost of sales (excluding depreciation and amortization expenses) primarily consists of purchases of NGLs and natural gas from our producers at contracted market prices to support product sales to other third parties.
As of December 31, 2024, we had outstanding borrowing under the A/R Facility of $140.2 million. Our operations can be capital intensive, requiring investments to expand, upgrade, maintain or enhance existing operations and to meet environmental and operational regulations.
As of December 31, 2025, we had an outstanding borrowing of $165.2 million. Capital Requirements and Expenditures Our operations can be capital intensive, requiring investments to expand, upgrade, maintain or enhance existing operations and to meet environmental and operational regulations.
Net cash provided by operating activities increased by $52.9 million for the year ended December 31, 2024 compared with the same period in 2023.
Net cash provided by operating activities decreased by $33.2 million for the year ended December 31, 2025, compared with the same period in 2024.
Investing Activities . Net cash used in investing activities decreased by $509.4 million for the year ended December 31, 2024 compared with the same period in 2023.
Investing Activities . Net cash used in investing activities increased by $22.2 million for the year ended December 31, 2025 compared with the same period in 2024.
Our Operations and Segments We have two reportable segments which are strategic business units with various products and services. The Midstream Logistics segment operates under three service offerings, 1) gas gathering and processing, 2) crude oil gathering, stabilization and storage services and 3) produced water gathering and disposal.
Our operations are strategically located in the heart of the Delaware Basin. Our Operations and Segments We have two reportable segments with revenue streams from various products and services. The Midstream Logistics segment operates under three revenue streams, 1) gas gathering and processing, 2) crude oil gathering, stabilization and storage services and 3) produced water gathering and disposal.
Critical Accounting Policies and Estimates Our significant accounting policies are described in Part IV, Item 15. Exhibits, Financial Statement Schedules, Note 2—Summary of Significant Accounting Policies of this Annual Report. The Company prepares its financial statements and the accompanying notes in conformity with U.S.
Exhibits, Financial Statement Schedules, Note 2—Summary of Significant Accounting Policies of this Annual Report. 41 Table of Contents Index to Financial Statements The Company prepares its financial statements and the accompanying notes in conformity with U.S.
Midstream Logistics segment adjusted EBITDA increased by $71.7 million, or 13%, to $614.9 million for the year ended December 31, 2024, compared to $543.2 million for the same period in 2023.
Midstream Logistics segment adjusted EBITDA increased by $21.0 million, or 3%, to $635.8 million for the year ended December 31, 2025, compared to $614.9 million for the same period in 2024.
Service revenue Service revenue consists of service fees paid to the Company by its customers for providing comprehensive gathering, treating, processing and water disposal services necessary to bring natural gas, NGLs and crude oil to market.
The increase was primarily driven by higher period-over-period product revenue due to increased NGL and condensate volumes sold and increased natural gas residue prices. Service revenue Service revenue consists of service fees paid to the Company by its customers for providing comprehensive gathering, treating, processing and water disposal services necessary to bring natural gas, NGLs and crude oil to market.
The increase was primarily due to the increased total operating revenue of $223.9 million, or 18%, partially offset by increases in cost of sales (exclusive of depreciation and amortization) of $106.6 million, or 21%, and operating expense and ad valorem taxes of $35.1 million or 19%. The reasons for the fluctuations are discussed in the Item 7.
The increase was primarily due to the increased total operating revenue of $281.3 million, or 19%, partially offset by increases in cost of sales (excluding depreciation and amortization expenses) of $165.0 million, or 27%, and operating expense and ad valorem taxes of $79.8 million or 37%. The reasons for the fluctuations are discussed in the Item 7.
Gulf Coast: 1) an approximate 55.5% equity interest in Permian Highway Pipeline LLC (“ PHP”), which is also owned and operated by Kinder Morgan; 2) 33.0% equity interest in Shin Oak, which is owned by Breviloba, LLC, and operated by Enterprise Products Operating LLC; and 3) 27.5% equity interest in Epic Crude Holdings, LP (“EPIC”), which is operated by EPIC Consolidated Operations, LLC.
Gulf Coast and Mexico markets: 1) an approximate 55.5% equity interest in PHP, which is also owned and operated by Kinder Morgan; and 2) 33.0% equity interest in Shin Oak, which is owned by Breviloba, LLC, and operated by Enterprise Products Operating LLC. Kinetik NGL Pipeline System.
Refer to Note 13—Derivatives and Hedging Activities in the Notes to Consolidated Financial Statements in this Annual Report for additional discussion regarding our hedging strategies and objectives for interest rate risk. 34 Table of Contents Index to Financial Statements Results of Operations The following table presents the Company’s results of operations for the periods presented: Year Ended December 31, 2024 2023 % Change (In thousands, except percentages) Operating revenues: Service revenue $ 408,000 $ 417,751 (2) % Product revenue 1,062,986 822,410 29 % Other revenue 11,943 16,251 (27) % Total operating revenues 1,482,929 1,256,412 18 % Operating costs and expenses: Cost of sales (exclusive of depreciation and amortization expenses) * 620,618 515,721 20 % Operating expenses 195,970 161,520 21 % Ad valorem taxes 24,714 21,622 14 % General and administrative expenses 134,157 97,906 37 % Depreciation and amortization expenses 324,197 280,986 15 % Loss on disposal of assets, net 4,040 19,402 (79) % Total operating costs and expenses 1,303,696 1,097,157 19 % Operating income 179,233 159,255 13 % Other income (expense): Interest and other income 2,802 2,004 40 % Loss on debt extinguishment (525) (1,876) (72) % Gain on sale of equity method investment 89,802 — 100 % Interest expense (217,235) (205,854) 6 % Equity in earnings of unconsolidated affiliates 213,191 200,015 7 % Total other income (expense), net 88,035 (5,711) NM Income before income taxes 267,268 153,544 74 % Income tax expense (benefit) 23,035 (232,908) (110) % Net income including noncontrolling interests $ 244,233 $ 386,452 (37) % *Cost of sales (exclusive of depreciation and amortization) is net of gas service revenues totaling $219.7 million and $148.3 million for the years ended December 31, 2024 and 2023, respectively, for certain volumes where we act as principal.
Refer to Note 13—Derivatives and Hedging Activities in the Notes to Consolidated Financial Statements in this Annual Report for additional discussion regarding our hedging strategies and objectives for interest rate risk. 33 Table of Contents Index to Financial Statements Results of Operations The following table presents the Company’s results of operations for the periods presented: Year Ended December 31, 2025 2024 % Change (In thousands, except percentages) Operating revenues: Service revenue $ 445,496 $ 408,000 9 % Product revenue 1,307,228 1,062,986 23 % Other revenue 11,665 11,943 (2) % Total operating revenues 1,764,389 1,482,929 19 % Operating costs and expenses: Cost of sales (excluding depreciation and amortization expenses) (1) 785,948 620,618 27 % Operating expenses 271,402 195,970 38 % Ad valorem taxes 28,851 24,714 17 % General and administrative expenses 130,616 134,157 (3) % Depreciation and amortization expenses 382,645 324,197 18 % Loss on disposal of assets, net 8 4,040 (100) % Total operating costs and expenses 1,599,470 1,303,696 23 % Operating income 164,919 179,233 (8) % Other income (expense): Interest and other income 3,983 2,802 42 % Loss on debt extinguishment (635) (525) 21 % Gain on sale of equity method investment 415,409 89,802 NM Interest expense (233,371) (217,235) 7 % Equity in earnings of unconsolidated affiliates 226,351 213,191 6 % Total other income, net 411,737 88,035 NM Income before income taxes 576,656 267,268 116 % Income tax expense 50,728 23,035 120 % Net income including noncontrolling interest $ 525,928 $ 244,233 115 % (1) Cost of sales (excluding depreciation and amortization expenses) is net of gas service revenues totaling $315.6 million and $219.7 million for the years ended December 31, 2025 and 2024, respectively, for certain volumes where we act as principal.
Segment Adjusted EBITDA Segment Adjusted EBITDA is defined as segment net income including noncontrolling interests adjusted for taxes, depreciation and amortization, gain or loss on disposal of assets, the proportionate EBITDA from our EMI pipelines, equity income and gain from sale of investments recorded using the equity method, noncash increases and decreases related to hedging activities, fair value adjustments for contingent liabilities, integration and transaction costs and extraordinary losses and unusual or non-recurring charges The following table presents Segment Adjusted EBITDA.
The increase was primarily due to the increase in income before income taxes of $309.4 million for the year ended December 31, 2025 compared to the same period in 2024. 35 Table of Contents Index to Financial Statements Key Performance Metrics Adjusted EBITDA Adjusted EBITDA is defined as net income including noncontrolling interest adjusted for interest, taxes, depreciation and amortization, gain or loss on disposal of assets and debt extinguishment, the proportionate EBITDA from our EMI Pipelines, equity income and gain from sale of investments recorded using the equity method, share-based compensation expense, noncash increases and decreases related to commodity hedging activities, fair value adjustments to contingent liabilities, integration and transaction costs, litigation costs and extraordinary losses and unusual or non-recurring charges.
Other Income (Expense) Gain on sale of equity method investment For the year ended December 31, 2024, we had gain on sale of equity method investment of $89.8 million compared to the same period in 2023 related to the GCX Sale consummated in the second quarter of 2024.
Other Income (Expense) Gain on sale of equity method investment Gain on sale of equity method investment increased by $325.6 million, or over 300% to $415.4 million for the year ended December 31, 2025, compared to $89.8 million for the same period in 2024.
Our core capabilities include a variety of service offerings including natural gas gathering, transportation, compression, treating and processing; NGLs stabilization and transportation; produced water gathering and disposal; and crude oil gathering, stabilization, storage and transportation. The Company’s corporate office is located in Houston, Texas and our operations are strategically located in the heart of the Delaware Basin.
Overview We are an integrated midstream energy company in the Permian Basin providing comprehensive gathering, transportation, compression, processing and treating services. Our core capabilities include a variety of service offerings including natural gas gathering, transportation, compression, treating and processing; NGLs stabilization and transportation; produced water gathering and disposal; and crude oil gathering, stabilization, storage and transportation.
Income Taxes We make significant judgments and estimates in determining our provision for income taxes, including our assessment of our income tax positions, interpretation and application of complex tax laws and regulations and determining a valuation allowance, if necessary.
We do not anticipate future changes in the methods used to determine the fair value of these derivative contracts. 42 Table of Contents Index to Financial Statements Income Taxes We make significant judgments and estimates in determining our provision for income taxes, including our assessment of our income tax positions, interpretation and application of complex tax laws and regulations and determining a valuation allowance, if necessary.
Cash Flows The following tables present cash flows from operating, investing, and financing activities: For The Year Ended December 31, 2024 2023 (In thousands) Cash provided by operating activities $ 637,346 $ 584,480 Cash used in investing activities $ (176,887) $ (686,320) Cash (used in) provided by financing activities $ (461,363) $ 99,956 40 Table of Contents Index to Financial Statements Operating Activities .
Cash Flows The following tables present cash flows from operating, investing, and financing activities: For The Year Ended December 31, 2025 2024 (In thousands) Cash provided by operating activities $ 604,120 $ 637,346 Cash used in investing activities $ (199,094) $ (176,887) Cash used in financing activities $ (404,681) $ (461,363) Operating Activities .
As a result of uncertainty around global commodity supply and demand, global geopolitical conflicts, foreign and trade policies with the new U.S. presidential administration, as well as the ongoing armed conflict in Ukraine, global oil and natural gas commodity prices continue to remain volatile.
As a result of uncertainty around global commodity supply and demand, global geopolitical conflicts, foreign and domestic trade policies implemented by the Trump Administration and responses thereto, and recent action by OPEC+, global oil and natural gas commodity prices continue to remain volatile.
NM - Not meaningful Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 Revenues For the year ended December 31, 2024, revenue increased $226.5 million, or 18%, to $1,482.9 million, compared to $1,256.4 million for the same period in 2023.
NM - Not meaningful Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 Revenues For the year ended December 31, 2025, revenue increased by $0.28 billion, or 19%, to $1.76 billion, compared to $1.48 billion for the same period in 2024.
The Company did not receive any proceeds from the sale of shares of Common Stock in the offering. Factors Affecting Our Business Commodity Price Volatility There has been, and we believe there will continue to be, volatility in commodity prices and in the relationships among NGLs, crude oil and natural gas prices.
The Company recorded a loss on debt extinguishment of $0.6 million for the extinguishment of these existing credit facilities. Factors Affecting Our Business Commodity Price Volatility There has been, and we believe there will continue to be, volatility in commodity prices and in the relationships among NGLs, crude oil and natural gas prices.
Service revenue for the year ended December 31, 2024, decreased by $9.8 million, or 2%, to $408.0 million, compared to $417.8 million for the same period in 2023. The decrease was primarily driven by lower period-over-period gas gathering fees of $9.5 million.
Service revenue for the year ended December 31, 2025, increased by $37.5 million, or 9%, to $445.5 million, compared to $408.0 million for the same period in 2024.
Management’s Discussion and Analysis of Financial Condition and Results of Operations—Results of Operations to this Annual Report. Pipeline Transportation segment adjusted EBITDA increased by $66.4 million, or 21%, to $377.6 million for the year ended December 31, 2024, compared to $311.1 million for the same period in 2023.
Pipeline Transportation segment adjusted EBITDA decreased by $7.4 million, or 2%, to $370.1 million for the year ended December 31, 2025, compared to $377.6 million for the same period in 2024.
Although ongoing armed conflicts might generate commodity price upward pressure, and our operations 33 Table of Contents Index to Financial Statements could benefit in an environment of higher natural gas, NGLs and condensate prices, the instability of the international political environment and human and economic hardship resulting from the conflicts would have a highly uncertain impact on the U.S. economy, which in turn, might affect our business and operations adversely.
In addition, the instability of the international political environment and human and economic hardship resulting from the armed conflicts would have a highly uncertain impact on the U.S. economy, which in turn, might affect our business and operations adversely. Moreover, the impact of tariffs imposed by the Trump Administration and foreign governments is highly uncertain.
In addition, the Company paid net cash of $341.2 million associated with the Durango Acquisition and net cash of $125.0 million to acquire midstream infrastructure assets through a business combination that closed in the first quarter 2023, see additional information in Note—3. Business Combinations in the Notes to the Consolidated Financial Statements in this Annual Report.
Furthermore, the Company paid net cash of $175.5 million associated with the Barilla Draw Acquisition in 2025 and $341.2 million associated with the Durango Acquisition in 2024, see additional information in No te 3 — Bus iness Combinations in the Notes to the Consolidated Financial Statements in this Annual Report.
Product revenue for the year ended December 31, 2024, increased by $240.6 million, or 29%, to $1,063.0 million, compared to $822.4 million for the same period in 2023, primarily due to period-over-period increases in natural gas residue sales volumes of 51.7 million MMBtu, or over 200% and NGL and condensate volumes sold of 2.0 million barrels, or 6%.
Product revenue for the year ended December 31, 2025, increased by $0.24 billion, or 23%, to $1.31 billion, compared to $1.06 billion for the same period in 2024, primarily due to a period-over-period increase in NGL and condensate volumes sold of 17.0 million barrels, or 41%, and a period-over-period increase in natural gas prices of $0.43 per MMBtu, or 33%, partially offset by a decrease in natural gas residue sales volumes of 9.8 million MMBtu, or 16%, and decreases in NGL and condensate prices of $2.87 per barrel, or 13% and $11.86 per barrel, or 16%, respectively.
The Midstream Logistics segment provides gas gathering and processing services with over 3,900 miles of low and high-pressure steel pipeline located throughout the Delaware Basin, including over 2,300 miles of gas 31 Table of Contents Index to Financial Statements pipeline acquired through the Durango Acquisition, and over 570,000 horsepower of compression capacity.
The Midstream Logistics segment provides gas gathering and processing services with over 4,200 miles of low and high-pressure steel pipeline located throughout the Delaware Basin, and over 825,000 horsepower of compression capacity. Gas processing assets are centralized at eight processing complexes with total cryogenic processing capacity of over 2.4 Bcf/d.
General and administrative expenses General and administrative expenses increased by $36.3 million, or 37% to $134.2 million for the year ended December 31, 2024, compared to $97.9 million for the same period in 2023.
For the year ended December 31, 2025, cost of sales increased by $165.3 million, or 27%, to $785.9 million, compared to $620.6 million for the same period in 2024.
More than 99% of the cost of sales (exclusive of depreciation and amortization) are included in the Midstream Logistics segment. Operating expenses Operating expenses increased by $34.5 million, or 21%, to $196.0 million for the year ended December 31, 2024, compared to $161.5 million for the same period in 2023.
The remaining increase was primarily driven by increases in utility costs totaling $20.5 million. Over 99% of operating expenses are included in the Midstream Logistics segment. Depreciation and amortization expenses Depreciation and amortization expense increased by $58.4 million, or 18% to $382.6 million for the year ended December 31, 2025, compared to $324.2 million for the same period in 2024.
During the year ended December 31, 2024 and 2023, capital spending for property, plant and equipment totaled $263.5 million and $312.9 million, respectively, intangible asset purchases of $12.3 million and $16.7 million, respectively, contributions to EMI totaled $3.3 million and $238.8 million, respectively, and paid net cash of $85.4 million to acquire additional equity interests in EPIC in second quarter 2024.
During the years ended December 31, 2025 and 2024, capital spending for property, plant and equipment totaled $492.5 million and $263.5 million, respectively, intangible asset purchases totaled $37.2 million and $12.3 million, respectively, and contributions to EMI totaled $1.2 million and $3.3 million, respectively.
As of December 31, 2024, we had $800.0 million of our 6.625% senior unsecured notes due 2028 and $1.0 billion of our 5.875% senior unsecured notes due 2030 outstanding.
As of December 31, 2025, we had $1.05 billion of our 6.625% senior unsecured notes due 2028 and $1.00 billion of our 5.875% senior unsecured notes due 2030 outstanding. Term Loan Credit Agreement On May 30, 2025, the Partnership entered into the Term Loan Credit Agreement. The Term Loan Credit Agreement provides for a $1.15 billion senior unsecured credit facility.
The system includes over 360 miles of gathering pipeline and approximately 580,000 barrels per day of permitted disposal capacity. Pipeline Transportation EMI pipelines. The Company owns the following equity interests in three EMI pipelines in the Permian Basin with access to various points along the U.S.
The Company owns the following equity interests in two EMI Pipelines in the Permian Basin with access to various points along the U.S.
The increase was also related to an increase in total operating revenue of $27.0 million, primarily related to the Delaware Link Pipeline that was placed in service in October 2023. Contractual Obligations We have contractual obligations for principal and interest payments on our 2028 Notes, 2030 Notes, the Term Loan Credit Facility, Revolving Credit Facility and A/R Facility.
Contractual Obligations We have contractual obligations for principal and interest payments on our 2028 Notes, 2030 Notes, and under the Term Loan Credit Agreement, the Revolving Credit Agreement and the Amended A/R Facility.
The Delaware Link Pipeline consists of approximately 40 miles of 30-inch diameter pipeline with a capacity of approximately 1.0 Bcf/d that provides additional transportation capacity to Waha. The project reached commercial in-service in October 2023.
The Delaware Link Pipeline consists of approximately 40 miles of 30-inch diameter pipeline with an initial capacity of approximately 1.0 Bcf/d that provides additional transportation capacity to Waha. ECCC Pipeline. The ECCC Pipeline is under construction, which provides connection from Eddy County, New Mexico to Culberson County, Texas, and approximately 150 MMcfp/d of initial rich gas throughput capacity.
Total gathered and processed gas volumes increased 227.4 Mcf per day, or 13% and 189.9 Mcf per day, or 13%, respectively. Of the increase, Durango’s operations, on a six months basis, accounted for 105.8 Mcf per day and 98.2 Mcf per day of gathered and processed gas volumes, respectively.
Period-over-period total gathered and processed gas volumes increased by 325.8 MMcf per day, or 17% and 172.6 MMcf per day, or 11%, respectively. Of the increase, Durango’s operations accounted for 146.9 MMcf per day and 142.5 MMcf per day of gathered and processed gas volumes, respectively.
See Note 8—Debt and Financing Costs in the Notes to our Consolidated Financial Statements in this Annual Report.
See Note 17 — Commitments and Contingencies in our Notes to the Consolidated Financial Statements in this Annual Report for more information on environmental matters. 43 Table of Contents Index to Financial Statements
In light of the recent economic activity, unemployment level and uncertainty in policy making with the Trump Administration, the FOMC decided to maintain the target range for the federal funds rate at 4.25 % - 4.50% during its meeting in January 2025.
Inflation and Interest Rates The annual rate of inflation in the United States was 2.4% in January 2026 as measured by the Consumer Price Index. In light of the recent economic activity and labor market conditions, the FOMC decided to maintain the target range for the federal funds rate to 3.50% - 3.75 % during its meeting in January 2026.
The $561.3 million change was primarily due to a net repayment of outstanding debt of $65.4 million made in 2024 compared to net proceeds of $187.8 million from the long-term debt and Revolving Credit Facility in 2023.
Net cash used in financing activities decreased by $56.7 million for the year ended December 31, 2025 compared with the same period in 2024. The decrease was mainly driven by net proceeds from long-term debt, Revolving Credit Facility and A/R Facility of $275.9 million compared to a net repayment of outstanding debt of $65.4 million made in 2024.
The Company estimates 2025 capital expenditures of approximately $450.0 million to $540.0 million, which is slightly higher than 2024.
Management believes its existing gathering, processing, and transmission infrastructure capacity is capable of fulfilling its contracts to service its customers. The Company estimates 2026 capital expenditures of approximately $450.0 million to $510.0 million, which is slightly lower than 2025.
For the year ended December 31, 2024, cost of sales increased $104.9 million, or 20%, to $620.6 million, compared to $515.7 million for the same period in 2023. As discussed above, the increase was primarily driven by period-over-period increases in natural gas residue and NGL and condensate volumes sold, slightly offset by lower natural gas prices.
As discussed above, the increase was primarily driven by period-over-period increases in NGL and condensate volumes sold and natural gas prices, slightly offset by decreases in natural gas sales volumes and NGL and condensate prices. More than 99% of the cost of sales (excluding depreciation and amortization expenses) are included in the Midstream Logistics segment.
The Durango Acquisition was accounted for as a business combination in accordance with ASC 805. Refer to Note 3—Business Combination in the Notes to the Consolidated Financial Statements in this Annual Report for further information regarding the Durango Acquisition. Overview We are an integrated midstream energy company in the Permian Basin providing comprehensive gathering, transportation, compression, processing and treating services.
The Barilla Draw Acquisition provides a multi-stream opportunity for natural gas gathering, compression and processing, as well as crude gathering services for the Company. Refer to Note 3—Business Combinations in the Notes to the Consolidated Financial Statements in this Annual Report for more information.
Loss on disposal of assets, net Loss on disposal of asset, net decreased by $15.4 million, or 79% to $4.0 million for the year ended December 31, 2024, compared to $19.4 million for the same period in 2023.
Interest expense Interest expense increased by $16.1 million, or 7%, to $233.4 million for the year ended December 31, 2025, compared to $217.2 million for the same period in 2024.
During the meeting, the FOMC noted that the economic outlook is uncertain and the Committee is attentive to the risks to both sides of its dual mandate and is strongly committed to supporting maximum employment and returning inflation to its 2.00% objective.
The FOMC also noted that it remains attentive to the risks to both sides of its dual mandate and seeks to achieve maximum employment and inflation at the rate of 2.00%. The Company will continue to monitor the FOMC’s monetary policy and interest rate movement.
Crude gathering assets are centralized at the Caprock Stampede Terminal and the Pinnacle Sierra Grande Terminal. The system includes approximately 220 miles of gathering pipeline and 90,000 barrels of crude storage. An additional 75 miles of gathering pipeline was added to our crude gathering assets through the Permian Resources Midstream Acquisition closed during January 2025. Water Gathering and Disposal.
In addition, the Midstream Logistics segment provides system-wide amine treating and 6.5 MMcf/d of acid gas injection capacity. Crude Oil Gathering, Stabilization and Storage Services. Crude gathering assets are centralized at the Caprock Stampede Terminal and the Pinnacle Sierra Grande Terminal. The system includes approximately 280 miles of gathering pipeline and 90,000 barrels of crude storage.
Depreciation and amortization expenses Depreciation and amortization expense increased by $43.2 million, or 15% to $324.2 million for the year ended December 31, 2024, compared to $281.0 million for the same period in 2023. Of the total increase, $25.5 million was driven by the Durango Acquisition that was completed during late June 2024.
Operating expenses Operating expenses increased by $75.4 million, or 38%, to $271.4 million for the year ended December 31, 2025, compared to $196.0 million for the same period in 2024. Of the total increase, $29.9 million was driven by Durango’s full 12 months of operations, and $23.7 million was driven by Barilla Draw operations acquired in January 2025.
GCX Divestiture On June 4, 2024, the Company consummated the previously announced transaction contemplated by the GCX Purchase Agreement to sell its 16% equity interest in GCX for an adjusted purchase price of $524.4 million (the "GCX Sale"), including an additional $30.0 million earn out in cash upon the approval by the GCX Board of Directors of one or more capital projects that achieve certain capacity expansion criteria.
In addition, the Company can receive approximately $96.0 million attributable to an earnout, payable upon the approval by the board of directors of the general partner of EPIC of one or more capital projects that achieve certain capacity expansion criteria.
In addition, the Company, when economically appropriate, enters into fee-based arrangements that insulate the Company from commodity price volatility. Inflation and Interest Rates The annual rate of inflation in the U.S. was 3.00% in January 2025 as measured by the Consumer Price Index.
In addition, the Company, when economically appropriate, enters into fee-based and NGL arbitrage arrangements that insulate the Company from commodity price volatility. In addition, our business requires access to steel and other materials to construct and maintain our pipelines and other midstream assets.
As the context requires, dividends paid to holders of Class A Common Stock and distributions paid to holders of Common Units may be referred to collectively as “dividends.” Liquidity The following table presents a summary of the Company’s key financial indicators: December 31, 2024 2023 (In thousands) Cash and cash equivalents $ 3,606 $ 4,510 Total debt, net of unamortized deferred financing cost $ 3,504,196 $ 3,562,809 Available committed borrowing capacity $ 657,200 $ 643,400 Off-Balance Sheet Arrangements As of December 31, 2024, there were no off-balance sheet arrangements.
As the context requires, dividends paid to holders of Class A Common Stock and distributions paid to holders of Common Units may be referred to collectively as “dividends”. Off-Balance Sheet Arrangements As of December 31, 2025, there were no off-balance sheet arrangements. Critical Accounting Policies and Estimates Our significant accounting policies are described in Part IV, Item 15.
Removed
Significant Business Combinations On February 22, 2022, (“the Altus Closing Date”), Kinetik Holdings Inc., a Delaware corporation (formerly known as Altus Midstream Company), consummated the business combination transactions contemplated by the Contribution Agreement, dated as of October 21, 2021 (the “Contribution Agreement”), by and among the Company, Altus Midstream LP (now known as Kinetik Holdings LP, the “Partnership”), a Delaware limited partnership and subsidiary of Altus Midstream Company.
Added
The crude facilities have connections for takeaway transportation into certain facilities operated by Plains All American Pipeline, L.P. 31 Table of Contents Index to Financial Statements Water Gathering and Disposal. The system includes approximately 370 miles of gathering pipeline and approximately 580,000 barrels per day of permitted disposal capacity. Pipeline Transportation EMI Pipelines.
Removed
New BCP Raptor Holdco, LLC, a Delaware limited liability company, and BCP.

… 95 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

4 edited+0 added−0 removed10 unchanged
Biggest changeAs of December 31, 2024, the Company had two interest rate swap contracts with total notional amounts of $1.70 billion maturing on May 31, 2025 that pay a fixed rate ranging from 4.38% to 4.48% and four interest rate swap contracts with total notional amount of $0.30 billion maturing on December 31, 2025 that pays a fixed rate ranging from 3.02% to 4.06%.
Biggest changeAs of December 31, 2025, the Company had nine interest rate swap contracts with total notional amounts of $675.0 million effective on May 1, 2023 and matured on December 31, 2025 that paid a fixed rate ranging from 3.02% to 4.18% and two interest rate swap contracts with a total notional amount of $500.0 million effective December 31, 2025 and maturing on December 31, 2026 that pay a fixed rate ranging from 3.41% to 3.42%.
A 1.0% increase or decrease in interest rates would change our annualized interest expense by approximately $17.0 million for the Revolving Credit Facility, the Term Loan Credit Facility and the A/R Facility, based on our outstanding borrowings at December 31, 2024.
A 1.0% increase or decrease in interest rates would change our annualized interest expense by approximately $17.7 million for the Revolving Credit Facility, the Term Loan Credit Facility and the A/R Facility, based on our outstanding borrowings at December 31, 2025.
Interest Rate Risk The market risk inherent in our financial instruments and our financial position represents the potential loss arising from adverse changes in interest rates. As of December 31, 2024, the Company had interest bearing debt, net of deferred financing costs, with a principal amount of $3.50 billion.
Interest Rate Risk The market risk inherent in our financial instruments and our financial position represents the potential loss arising from adverse changes in interest rates. As of December 31, 2025, the Company had interest bearing debt, net of deferred financing costs, with a principal amount of $3.79 billion.
The Company continually monitors its market risk exposure, including the impact of regional and international political instability, new U.S. presidential administration policies on various foreign and domestic issues and monetary policy addressing the interest rate and inflation trend, which continued to have significant impact on volatility and uncertainties in the financial markets.
The Company continually monitors its market risk exposure, including the impact of regional and international political instability, foreign and domestic trade policies under the U.S. Administration and monetary policy addressing the interest rate and inflation trend, which continued to have significant impact on volatility and uncertainties in the financial markets.

Other KNTK 10-K year-over-year comparisons