10 unchanged sentences
The term “earnings” as used in Management’s Discussion and Analysis refers to net income attributable to Phillips 66.
−Removed: The terms “results,” “before-tax income” or “before-tax loss” as used in Management’s Discussion and Analysis refer to income (loss) before income taxes.
+Added: The terms “results,” “before-tax income” or “before-tax loss” as used in Management’s Discussion and Analysis refer to “Income before income taxes” as presented on our consolidated statement of income.
EXECUTIVE OVERVIEW AND BUSINESS ENVIRONMENT
Phillips 66 is uniquely positioned as a leading integrated downstream energy provider operating with Midstream, Chemicals, Refining, Marketing and Specialties (M&S) and Renewable Fuels segments.
−Removed: At March 31, 2026, we had total assets of $84.1 billion.
+Added: At June 30, 2026, we had total assets of $81.8 billion.
Our common stock trades on the New York Stock Exchange under the symbol PSX.
Executive Overview
−Removed: In the first quarter of 2026, we reported earnings of $207 million.
−Removed: In response to the sharp increases in commodity prices and to preserve liquidity, we had net debt borrowings of $7.7 billion and increased our cash and cash equivalents by $4 billion.
−Removed: We used available cash to fund operating activities of $2.3 billion, capital expenditures and investments of $582 million, dividend payments to common stockholders of $509 million and repurchases of our common stock of $269 million.
−Removed: The use of cash in operating activities was primarily due to unfavorable net working capital impacts, which was primarily driven by an increase in inventory and higher accounts receivable, partially offset by higher accounts payable;
−Removed: as well as, the funding of approximately $3 billion of cash collateral on derivative positions.
−Removed: As of March 31, 2026, we had $5.2 billion of cash and cash equivalents and $0.8 billion of total committed capacity available under our credit facilities.
+Added: In the second quarter of 2026, we reported earnings of $3.8 billion and generated $7.3 billion of cash from operations.
+Added: We had net debt repayments of $6.7 billion, funded capital expenditures and investments of $726 million, paid dividends of $508 million to common stockholders and repurchased $379 million of our common stock.
+Added: The cash provided by operating activities was due to higher earnings, primarily driven by an increase in realized refining margins and favorable net working capital impacts.
+Added: Net working capital reflected favorable impacts from the net timing of payments and collections, lower inventory, and higher taxes and other accruals, partially offset by higher prepaid expenses and other current assets.
+Added: As of June 30, 2026, we had $4.1 billion of cash and cash equivalents and $6.4 billion of total committed capacity available under our credit facilities.
Strategic Priorities Update
2 unchanged sentences
disciplined growth and returns;
−Removed: financial strength and flexibility and shareholder returns.
+Added: financial strength and flexibility;
+Added: and shareholder returns.
• World-Class Operations – We are focused on operational and cost reduction targets driving world-class operations across our portfolio.
13 unchanged sentences
Our financial target aims to return greater than 50% of net cash provided by operating activities, excluding working capital, to shareholders through share repurchases and dividends.
−Removed: This amount and timing of future dividend payments and the level and timing of future share repurchases is subject to the discretion of, and approval by, our Board of Directors and will depend on various factors including our share price, results of operations, financial condition and cash required for future business plans.
−Removed: • In February and April 2026, our Board of Directors declared a quarterly cash dividend of $1.27 per common share, reflecting our commitment to a secure, competitive and growing dividend.
+Added: The amount and timing of future dividend payments and the level and timing of future share repurchases is subject to the discretion of, and approval by, our Board of Directors and will depend on various factors including our share price, results of operations, financial condition and cash required for future business plans.
+Added: • In April and July 2026, our Board of Directors declared quarterly cash dividends of $1.27 per common share, reflecting our commitment to a secure, competitive and growing dividend.
+Added: • In July 2026, our Board of Directors approved a $10 billion increase to our share repurchase authorization.
+Added: Since July 2012, our Board of Directors has authorized an aggregate of $35 billion of repurchases of our outstanding common stock under our share repurchase program.
+Added: • During the six months ended June 30, 2026, our net cash provided by operating activities was $5 billion and we returned $1.7 billion to shareholders through share repurchases and dividends.
Business Environment
−Removed: During March 2026, the business environment in which we operate was impacted by significant movements in commodity prices as a result of geopolitical events in the Middle East.
−Removed: The global crude oil market quickly shifted into structural deficit and the disruption materially reduced crude oil and refined products from the markets, pushing benchmark crude oil prices at the end of the quarter above $100 per barrel.
−Removed: In addition, natural gas, liquefied petroleum gas (LPG) and petrochemical markets have materially tightened.
−Removed: While these impacts were most notable during the last month of the quarter, due to the uncertainty regarding duration, continued disruptions could materially impact our future results.
−Removed: Below is a discussion of additional factors impacting our environment during the three months ended March 31, 2026 as compared to the same period of 2025.
+Added: We continue to see significant movements in commodity prices as a result of geopolitical events, and due to the uncertainty regarding their duration, continued disruptions could materially impact our future results.
+Added: Below is a discussion of additional factors impacting our environment during the three months ended June 30, 2026, as compared to the same period of 2025.
Our Midstream segment includes our Transportation and NGL businesses.
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Our NGL business contains both fee-based operations and operations directly impacted by NGL and natural gas prices.
−Removed: The weighted-average NGL price was $0.62 per gallon during the first quarter of 2026, compared with $0.74 per gallon during the first quarter of 2025.
−Removed: The Henry Hub natural gas price was $4.87 per million British thermal units (MMBtu) during the first quarter of 2026, compared with $4.27 per MMBtu during the first quarter of 2025.
−Removed: The decrease in NGL prices was primarily due to increased supply, while the increase in natural gas prices was due to increased liquified natural gas exports as U.S.
−Removed: export infrastructure increases.
+Added: The weighted-average NGL price was $0.73 per gallon during the second quarter of 2026, compared with $0.64 per gallon during the second quarter of 2025.
+Added: The Henry Hub natural gas price was $2.93 per million British thermal units (MMBtu) during the second quarter of 2026, compared with $3.16 per MMBtu during the second quarter of 2025.
+Added: The increase in NGL prices was primarily due to a tight supply market with fewer cargos from the Middle East, while the decrease in natural gas prices was due to increased natural gas supply and the end of the winter demand season.
Our Chemicals segment consists of our 50% equity investment in Chevron Phillips Chemical Company LLC (CPChem).
The chemicals and plastics industry is mainly a commodity-based industry where the margins for key products are based on supply and demand, as well as cost factors.
−Removed: The benchmark high-density polyethylene chain margin was 10.7 cents per pound in the first quarter of 2026, compared with 10.9 cents per pound in the first quarter of 2025.
−Removed: The decrease was mainly due to higher ethane prices, partially driven by rising natural gas prices, and continued industry capacity additions supporting higher global demand.
+Added: The benchmark high-density polyethylene chain margin was 43.6 cents per pound in the second quarter of 2026, compared with 7.4 cents per pound in the second quarter of 2025.
+Added: The increase was mainly due to lower plant utilizations in Asia that were driven by Middle East supply concerns.
Our Refining segment results are driven by several factors, including market crack spreads, refinery throughput, feedstock costs, product yields, turnaround activity and other operating costs.
Market crack spreads are used as indicators of refining margins and measure the difference between market prices for refined petroleum products and crude oil.
−Removed: The composite 3:2:1 market crack spread for our business increased to an average of $20.56 per barrel during the first quarter of 2026, from an average of $15.83 per barrel during the first quarter of 2025.
−Removed: The increase in the composite market crack spread was primarily driven by stronger petroleum diesel demand, supported by low seasonal inventories, and geopolitical events reducing global product resupply.
+Added: The composite 3:2:1 market crack spread for our business increased to an average of $41.63 per barrel during the second quarter of 2026, from an average of $21.65 per barrel during the second quarter of 2025.
+Added: The increase in the composite market crack spread was primarily driven by low seasonal product inventories, particularly diesel, and geopolitical events reducing global product resupply.
The price of U.S.
−Removed: benchmark crude oil, West Texas Intermediate (WTI) at Cushing, Oklahoma, increased to an average of $71.98 per barrel during the first quarter of 2026, from an average of $71.46 per barrel during the first quarter of 2025.
+Added: benchmark crude oil, West Texas Intermediate (WTI) at Cushing, Oklahoma, increased to an average of $93.21 per barrel during the second quarter of 2026, from an average of $63.86 per barrel during the second quarter of 2025.
The increase in crude oil prices was primarily driven by geopolitical events in the Middle East restricting global crude supply.
5 unchanged sentences
RESULTS OF OPERATIONS
−Removed: Unless otherwise indicated, discussion of results for the three months ended March 31, 2026, is based on a comparison with the corresponding period of 2025.
+Added: Unless otherwise indicated, discussion of results for the three and six months ended June 30, 2026, is based on a comparison with the corresponding period of 2025.
Consolidated Results
1 unchanged sentence
Millions of Dollars
−Removed: Three Months Ended March 31
+Added: Three Months Ended
+Added: June 30 Six Months Ended
+Added: 2026 2025 2026 2025
Midstream $ 785 731 1,376 1,482
9 unchanged sentences
Net income attributable to Phillips 66 $ 3,847 877 4,054 1,364
−Removed: Net income attributable to Phillips 66 in the first quarter of 2026 was $207 million, compared with $487 million in the first quarter of 2025.
−Removed: The decrease was primarily due to a before-tax gain of $1 billion associated with the sale of our investment in Coop Mineraloel AG (Coop) recognized in January 2025 in the M&S segment and lower U.S.
−Removed: and international marketing fuel margins, mainly driven by commodity derivative activities.
−Removed: These decreases were partially offset by higher realized refining margins during the first quarter of 2026 and $246 million of accelerated depreciation recorded in the first quarter of 2025 associated with the cessation of fuel production and idling of the Los Angeles Refinery.
−Removed: The increase in realized refining margins was primarily due to higher market crack spreads and increased feedstock advantage, partially offset by higher Renewable Identification Number (RIN) costs and commodity derivative activities.
+Added: Net income attributable to Phillips 66 in the second quarter of 2026 was $3.8 billion, compared with $0.9 billion in the second quarter of 2025.
+Added: Net income attributable to Phillips 66 for the six months ended June 30, 2026, was $4.1 billion, compared with $1.4 billion for the six months ended June 30, 2025.
+Added: The increase in net income attributable to Phillips 66 in the second quarter of 2026 was primarily due to improved realized margins for our Refining segment and higher values of regulatory credits in the Renewable Fuels segment.
+Added: The increase in net income attributable to Phillips 66 for the six months ended June 30, 2026, was primarily due to improved realized margins for our Refining segment and higher values of regulatory credits in the Renewable Fuels segment, partially offset by a before-tax gain of $1 billion associated with the sale of our investment in Coop Mineraloel AG (Coop) recognized in January 2025 in the M&S segment.
See Note 6—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information regarding the sale of our investment in Coop.
−Removed: See Note 7—Properties, Plants and Equipment, in the Notes to Consolidated Financial Statements for additional information regarding accelerated depreciation.
−Removed: See Note 13—Derivatives and Financial Instruments, in the Notes to Consolidated Financial Statements for additional information on commodity derivative activity.
−Removed: See the “Segment Results” section for additional information on our segment results.
+Added: Additionally, see the “Segment Results” section for additional information on our segment results.
Statement of Income Analysis
−Removed: Sales and other operating revenues increased 7% for the three months ended March 31, 2026, primarily due to higher refined petroleum product sales volumes, partially offset by losses from commodity derivative activity.
−Removed: Purchased crude oil and products increased 6% for the three months ended March 31, 2026, primarily due to losses from commodity derivative activity and higher crude oil purchase volumes.
+Added: Sales and other operating revenues increased 53% and 31% for the three and six months ended June 30, 2026, respectively.
+Added: Purchased crude oil and products increased 50% and 28% for the three and six months ended June 30, 2026, respectively.
+Added: The increases in both line items for the three and six months ended June 30, 2026, were primarily due to higher prices for refined petroleum products and crude oil, partially offset by impacts associated with the sale of 65% of our interest in Germany and Austria retail marketing business (Germany and Austria Marketing) in December 2025.
+Added: Additionally, the six months ended June 30, 2026, was impacted by losses from commodity derivative activity.
See Note 13—Derivatives and Financial Instruments, in the Notes to Consolidated Financial Statements for additional information.
−Removed: Equity in earnings of affiliates increased 65% for the three months ended March 31, 2026.
−Removed: The increase was primarily due to equity losses from WRB Refining LP (WRB) in the first quarter of 2025, compared to no equity earnings impact from WRB in the first quarter of 2026 after we acquired the remaining 50% equity interest in WRB on October 1, 2025.
+Added: Equity in earnings of affiliates increased $482 million and $581 million for the three and six months ended June 30, 2026, respectively.
+Added: The increases for both periods of 2026 were primarily due to higher equity earnings from CPChem.
+Added: The increase for the six months ended June 30, 2026, was also driven by equity losses from WRB Refining LP (WRB) in the first half of 2025, compared to no equity earnings from WRB in the first half of 2026 due to the acquisition of the remaining 50% equity interest in WRB on October 1, 2025.
See Note 2—Business Combinations, in the Notes to Consolidated Financial Statements for further details on the WRB acquisition.
−Removed: Net gain on dispositions decreased $1 billion for the three months ended March 31, 2026, primarily due to a before-tax gain of $1 billion associated with the sale of our investment in Coop recognized in January 2025 in the M&S segment.
−Removed: See Note 6—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information regarding the sale of Coop.
−Removed: Other income increased $148 million for the three months ended March 31, 2026, primarily driven by higher results from trading activities and increased sales of Clean Fuel Production credits.
−Removed: Operating expenses increased $259 million for the three months ended March 31, 2026, primarily due to our acquisition of WRB in October 2025, partially offset by lower turnaround costs.
−Removed: Depreciation and amortization decreased 29% for the three months ended March 31, 2026, primarily due to $246 million of accelerated depreciation recorded in the first quarter of 2025 associated with the cessation of fuel production and idling of the Los Angeles Refinery.
+Added: Net gain on dispositions for the three months ended June 30, 2026, was $117 million, compared with a Net loss on dispositions of $93 million for the three months ended June 30, 2025.
+Added: This increase was primarily due to a before-tax gain of $110 million recorded in the second quarter of 2026, related to post-closing adjustments from the partial sale of Germany and Austria Marketing, as well as a before-tax loss recognized in the second quarter of 2025, primarily associated with an aggregate unrealized loss of $89 million on foreign currency forward contracts entered into in connection with this transaction.
+Added: For the six months ended June 30, 2026 and 2025, we had a Net gain on dispositions of $123 million and $994 million, respectively.
+Added: This decrease was primarily due to a before-tax gain of $1 billion associated with the sale of our investment in Coop recognized in January 2025 in the M&S segment.
+Added: See Note 6—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information regarding the dispositions.
+Added: Other income increased $149 million and $297 million for the three and six months ended June 30, 2026, respectively.
+Added: The increases for both periods were primarily attributable to higher results from trading activities, Clean Fuel Production credits and interest income due to increased average cash balances.
+Added: Operating expenses increased $370 million and $629 million for the three and six months ended June 30, 2026, respectively.
+Added: The increases for both periods were primarily driven by our acquisition of WRB in October 2025, partially offset by lower costs following the cessation of operations at the Los Angeles Refinery.
+Added: Depreciation and amortization decreased 28% and 29% for the three and six months ended June 30, 2026, respectively.
+Added: These decreases were primarily due to depreciation recorded in 2025 for the Los Angeles Refinery.
See Note 7—Properties, Plants and Equipment, in the Notes to Consolidated Financial Statements for additional information.
−Removed: Interest and debt expense increased 29% for the three months ended March 31, 2026, primarily due to higher average debt balances.
−Removed: Income tax expense decreased 66% for the three months ended March 31, 2026, primarily due to lower income before income taxes.
+Added: Taxes other than income taxes decreased $91 million and $90 million for the three and six months ended June 30, 2026, respectively.
+Added: The decreases for both periods were primarily driven by lower customs duties.
+Added: Interest and debt expense increased 19% and 24% for the three and six months ended June 30, 2026, respectively, primarily due to higher average debt balances.
+Added: Income tax expense increased $880 million and $799 million for the three and six months ended June 30, 2026, respectively, primarily due to higher income before income taxes.
See Note 20—Income Taxes, in the Notes to Consolidated Financial Statements for information regarding our effective income tax rates.
−Removed: Net income attributable to noncontrolling interests decreased $27 million for the three months ended March 31, 2026, due to impacts from the gain on sale of DCP Midstream, LP’s (DCP LP’s) e quity investment in Gulf Coast Express Pipeline LLC (GCX) recorded in January 2025.
+Added: Net income attributable to noncontrolling interests decreased $26 million for the six months ended June 30, 2026, primarily due to lower earnings from DCP Midstream, LP (DCP LP) following the sale of its equity investment in Gulf Coast Express Pipeline LLC (GCX) in the first quarter of 2025.
See Note 6—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information.
Segment Results
−Removed: Three Months Ended March 31
+Added: Three Months Ended
+Added: June 30 Six Months Ended
+Added: 2026 2025 2026 2025
Millions of Dollars
1 unchanged sentence
Transportation $ 250 242 497 485
+Added: NGL 535 489 879 997
Total Midstream $ 785 731 1,376 1,482
17 unchanged sentences
In addition, this segment exports liquefied petroleum gas to global markets.
−Removed: Results from our Midstream segment decreased $160 million for the three months ended March 31, 2026.
−Removed: Results from our Transportation business for the three months ended March 31, 2026, were in line with results for the three months ended March 31, 2025.
−Removed: Results from our NGL business decreased $164 million for the three months ended March 31, 2026, primarily related to a before-tax gain of $68 million recognized in the first quarter of 2025 on the sale of DCP LP’s ownership interest in GCX, as well as lower margins associated with customer recontracting and winter weather impacts.
+Added: Results from our Midstream segment increased $54 million and decreased $106 million for the three and six months ended June 30, 2026, respectively.
+Added: Results from our Transportation business for the three and six months ended June 30, 2026, were in line with results for the three and six months ended June 30, 2025.
+Added: Results from our NGL business increased $46 million and decreased $118 million for the three and six months ended June 30, 2026, respectively.
+Added: The increase in the three months ended June 30, 2026, was primarily driven by widening natural gas transportation differentials out of the Permian Basin, as well as increased wellhead and fractionation volumes, partially offset by the effects of customer recontracting.
+Added: The decrease in the six months ended June 30, 2026, was primarily due to the effects of customer recontracting, a before-tax gain of $68 million recognized in the first quarter of 2025 on the sale of DCP LP’s ownership interest in GCX, and winter weather impacts, partially offset by widening natural gas transportation differentials out of the Permian Basin.
See the “Executive Overview and Business Environment” section for information on market factors impacting this quarter’s results.
See Note 6—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information regarding the sale of DCP LP’s ownership interest in GCX in 2025.
−Removed: Three Months Ended March 31
+Added: Three Months Ended
+Added: June 30 Six Months Ended
+Added: 2026 2025 2026 2025
Millions of Dollars
3 unchanged sentences
* Represents 100% of CPChem’s outside sales of produced petrochemical products, as well as commission sales from equity affiliates.
−Removed: Olefins and Polyolefins Capacity Utilization (percent) 94 % 100
−Removed: The Chemicals segment consists of our 50% interest in CPChem, which we account for under the equity method.
+Added: Global Olefins and Polyolefins Capacity Utilization (percent) 91 % 92 92 96
+Added: The Chemicals segment consists of our 50% equity investment in CPChem, which we account for under the equity method.
CPChem uses NGL and other feedstocks to produce petrochemicals.
4 unchanged sentences
Unless otherwise noted, amounts referenced below reflect our net 50% interest in CPChem.
−Removed: Results from the Chemicals segment for the three months ended March 31, 2026, were in line with results for the three months ended March 31, 2025;
−Removed: however, market conditions impacted the Chemicals segment in the 2026 period.
−Removed: The increase in the three months ended March 31, 2026, was primarily due to higher ethylene sales volumes, which were largely offset by reduced margins.
−Removed: The decrease in margins was driven by lower sales prices, partially offset by an inventory adjustment.
+Added: Results from the Chemicals segment increased $384 million and $385 million for the three and six months ended June 30, 2026, respectively, primarily due to improved polyethylene margins driven by higher sales prices.
See the “Executive Overview and Business Environment” section for information on market factors impacting CPChem’s results.
−Removed: Three Months Ended March 31
+Added: Three Months Ended
+Added: June 30 Six Months Ended
+Added: 2026 2025 2026 2025
Millions of Dollars
21 unchanged sentences
** See the “Non-GAAP Reconciliations” section for a reconciliation of this non-GAAP measure to the most directly comparable measure under generally accepted accounting principles in the United States (GAAP), income (loss) before income taxes per barrel.
+Added: The Refining segment refines crude oil and other feedstocks into petroleum products, such as gasoline and distillates, including aviation fuels, at 10 refineries in the United States and Europe.
On October 1, 2025, we acquired the remaining 50% ownership interest in WRB from subsidiaries of Cenovus Energy Inc.
2 unchanged sentences
See Note 7—Properties, Plants and Equipment, in the Notes to Consolidated Financial Statements for additional information.
+Added: Results from our Refining segment increased $2,703 million and $3,848 million for the three and six months ended June 30, 2026, respectively.
+Added: The increase in the three months ended June 30, 2026, was primarily due to higher realized margins as a result of improved market crack spreads and inventory impacts, including commodity derivative activity, partially offset by increased feedstock costs.
+Added: The increase in the six months ended June 30, 2026, was primarily driven by higher realized margins and volumes.
+Added: The increase in realized margins in the six months ended June 30, 2026, was due to improved market crack spreads, partially offset by increased feedstock costs.
+Added: See Note 13—Derivatives and Financial Instruments, in the Notes to Consolidated Financial Statements for additional information and the “Executive Overview and Business Environment” section for information on industry crack spreads and other market factors impacting this quarter’s results.
Thousands of Barrels Daily
−Removed: Three Months Ended March 31
+Added: Three Months Ended
+Added: June 30 Six Months Ended
Operating Statistics 2026 2025 2026 2025
28 unchanged sentences
*** In the fourth quarter 2025, we ceased fuel production and began idling the facilities at our Los Angeles Refinery, and the associated crude oil capacity is excluded from the statistics above beginning on October 1, 2025.
−Removed: The Refining segment refines crude oil and other feedstocks into petroleum products, such as gasoline and distillates, including aviation fuels, at 10 refineries in the United States and Europe.
−Removed: Results from our Refining segment increased $1,145 million for the three months ended March 31, 2026.
−Removed: The increase in the three months ended March 31, 2026, was primarily driven by improved realized margins and $246 million of accelerated depreciation recorded in the first quarter of 2025 associated with the cessation of fuel production and idling of the Los Angeles Refinery.
−Removed: The increase in realized margins was primarily due to higher market crack spreads and increased feedstock advantage.
−Removed: These increases are partially offset by higher RIN costs and impacts of commodity derivative activities.
−Removed: See Note 13—Derivatives and Financial Instruments, in the Notes to Consolidated Financial Statements for additional information on commodity derivative activity.
−Removed: Our worldwide refining crude oil capacity utilization rate was 95% and 80% for the three months ended March 31, 2026, and 2025, respectively.
−Removed: The increase for the three months ended March 31, 2026, was primarily due to lower turnaround activity.
−Removed: See the “Executive Overview and Business Environment” section for information on market factors impacting this quarter’s results.
+Added: † Capacity utilization percentages, as presented, are calculated using underlying crude oil processed volumes divided by crude oil capacity.
+Added: As such, recalculated utilization percentages using the rounded volumes presented may differ due to rounding.
+Added: Our worldwide refining crude oil capacity utilization rate was 96% and 95% for the three and six months ended June 30, 2026, respectively, compared with 98% and 89% in the three and six months ended June 30, 2025, respectively.
+Added: The decrease for the three months ended June 30, 2026, was primarily due to higher turnaround activity.
+Added: The increase for the six months ended June 30, 2026, was due to lower turnaround activity.
Marketing and Specialties
−Removed: Three Months Ended March 31
+Added: Three Months Ended
+Added: June 30 Six Months Ended
+Added: 2026 2025 2026 2025
Millions of Dollars
−Removed: Income (Loss) Before Income Taxes $ (161) 1,282
+Added: Income Before Income Taxes $ 583 571 422 1,853
Dollars Per Barrel
−Removed: Income (Loss) Before Income Taxes
+Added: Income Before Income Taxes
$ 1.13 2.32 0.05 1.55
13 unchanged sentences
Distillates 992 971 954 938
+Added: Other 60 70 54 55
+Added: 2,329 2,342 2,255 2,241
The M&S segment purchases for resale and markets refined products, mainly in the United States and Europe.
In addition, this segment includes the manufacturing and marketing of base oils and lubricants.
−Removed: Results from the M&S segment decreased $1.4 billion for the three months ended March 31, 2026.
−Removed: The decrease was primarily due to a before-tax gain of $1 billion associated with the sale of our investment in Coop recognized in January 2025, as well as lower U.S.
−Removed: and international marketing fuel margins, mainly driven by commodity derivative activities.
−Removed: See Note 6—Investments, Loans and Long-Term Receivables, in the Notes to Consolidated Financial Statements for additional information regarding the sale of Coop.
−Removed: See Note 13—Derivatives and Financial Instruments, in the Notes to Consolidated Financial Statements for additional information on commodity derivative activity.
−Removed: See the “Executive Overview and Business Environment” section for information on marketing fuel margins and other market factors impacting this quarter’s results.
+Added: Results from the M&S segment increased $12 million and decreased $1,431 million for the three and six months ended June 30, 2026, respectively.
+Added: The increase in the three months ended June 30, 2026, was primarily driven by impacts associated with the partial sale of Germany and Austria Marketing, along with higher equity earnings from Excel Paralubes.
+Added: These increases were partially offset by lower domestic marketing fuel margins and legal accruals.
+Added: The decrease in the six months ended June 30, 2026, was primarily due to a before-tax gain of $1 billion associated with the sale of our investment in Coop recognized in January 2025, as well as lower U.S.
+Added: and international marketing fuel margins, mainly driven by commodity derivative activity.
+Added: These decreases were partially offset by activity associated with the partial sale of Germany and Austria Marketing.
+Added: In the Notes to Consolidated Financial Statements, see Note 6—Investments, Loans and Long-Term Receivables, for additional information regarding the sale of Coop and partial sale of Germany and Austria Marketing, Note 12—Contingencies and Commitments, for additional information regarding legal accruals and Note 13—Derivatives and Financial Instruments, for additional information on commodity derivative activity.
+Added: Additionally, reference the “Executive Overview and Business Environment” section for information on marketing fuel margins and other market factors impacting this quarter’s results.
Renewable Fuels
−Removed: Three Months Ended March 31
+Added: Three Months Ended
+Added: June 30 Six Months Ended
+Added: 2026 2025 2026 2025
Millions of Dollars
−Removed: Loss Before Income Taxes $ (41) (185)
+Added: Income (Loss) Before Income Taxes $ 544 (133) 503 (318)
Thousands of Barrels Daily
9 unchanged sentences
In addition, this segment includes the global activities to procure renewable feedstocks, manage certain regulatory credits and market renewable fuels.
−Removed: Results from the Renewable Fuels segment increased $144 million for the three months ended March 31, 2026.
−Removed: The increase was primarily due to higher renewable product pricing and credit generation.
−Removed: These increases were partially offset by commodity derivative activities and lower product sales volumes.
−Removed: See Note 13—Derivatives and Financial Instruments, in the Notes to Consolidated Financial Statements for additional information on commodity derivative activity.
+Added: Results from the Renewable Fuels segment increased $677 million and $821 million for the three and six months ended June 30, 2026, respectively, primarily due to higher values of regulatory credits.
See the “Executive Overview and Business Environment” section for information on market factors impacting this quarter’s results.
1 unchanged sentence
Millions of Dollars
−Removed: Three Months Ended March 31
+Added: Three Months Ended
+Added: June 30 Six Months Ended
+Added: 2026 2025 2026 2025
Loss Before Income Taxes
6 unchanged sentences
Effective in the first quarter of 2026, activities associated with the decommissioning and redevelopment of our idled Los Angeles Refinery site are also included in corporate overhead and other.
−Removed: Corporate and Other also includes the change in the fair value of our investment in NOVONIX.
+Added: In addition, Corporate and Other includes the change in the fair value of our investment in NOVONIX.
See Note 14—Fair Value Measurements, in the Notes to Consolidated Financial Statements for additional information regarding our investment in NOVONIX.
−Removed: Net interest expense increased $68 million for the three months ended March 31, 2026, primarily due to higher average debt balances.
−Removed: Corporate overhead and other costs increased $13 million for the three months ended March 31, 2026, primarily due to costs associated with the decommissioning and redevelopment of our idled Los Angeles Refinery site and higher employee-related expenses.
−Removed: These were partially offset by lower depreciation expense associated with information technology assets and charges associated with canceled projects, both recorded in the first quarter of 2025.
+Added: Net interest expense increased $3 million and $71 million for the three and six months ended June 30, 2026, respectively.
+Added: The increase in the six months ended June 30, 2026, was primarily driven by higher average debt balances, partially offset by increased average cash balances.
+Added: Corporate overhead and other costs decreased $28 million and $15 million for the three and six months ended June 30, 2026, respectively.
+Added: The decreases for both periods were primarily due to lower depreciation expense associated with information technology assets and advisory fees related to proxy solicitation services, both recorded in 2025, partially offset by costs associated with the decommissioning and redevelopment of our idled Los Angeles Refinery site.
+Added: The decrease for the three months ended June 30, 2026, was additionally impacted by the timing of corporate charitable contributions, while the decrease for the six months ended June 30, 2026, also reflected charges associated with canceled projects recorded in the first quarter of 2025.
CAPITAL RESOURCES AND LIQUIDITY
11 unchanged sentences
To meet our short- and long-term liquidity requirements, we use a variety of funding sources but rely primarily on cash generated from operating activities and debt financing.
−Removed: During the first three months of 2026, we had net debt borrowings of $7.7 billion and increased cash and cash equivalents by $4 billion.
−Removed: We used cash to fund operating activities of $2.3 billion, capital expenditures and investments of $582 million, paid $509 million of dividends to our common stockholders, and repurchased $269 million of our common stock.
+Added: During the first six months of 2026, we generated $5 billion of cash from operations, increased cash and cash equivalents by $3 billion and had net debt borrowings of $1 billion.
+Added: We funded capital expenditures and investments of $1.3 billion, paid $1 billion of dividends to our common stockholders, and repurchased $0.6 billion of our common stock.
At this time, we believe that our cash on hand, as well as the sources of liquidity described herein, will be sufficient to fund our obligations over the short- and long-term.
1 unchanged sentence
Operating Activities
−Removed: During the first three months of 2026, net cash used in operating activities was $2.3 billion, compared with net cash provided by operating activities of $187 million for the first three months of 2025.
−Removed: The decrease was primarily due to unfavorable working capital impacts, mostly driven by an increase in inventory and higher accounts receivable as well as funding of approximately $3 billion of cash collateral on derivative positions, largely due to a sharp increase in commodity prices during the quarter.
−Removed: These decreases in working capital were partially offset by higher accounts payable.
+Added: During the first six months of 2026, cash generated by operating activities was $5 billion, compared with $1 billion for the first six months of 2025.
+Added: The increase was primarily due to higher earnings, driven by an increase in realized refining margins, as well as favorable working capital impacts.
+Added: The favorable working capital impacts were primarily driven by the net timing of payments and collections, lower inventory, and higher taxes and other accruals.
+Added: These increases in working capital were partially offset by higher prepaid expenses and other current assets.
Our short- and long-term operating cash flows are highly dependent upon refining and marketing margins, NGL prices and chemicals margins.
6 unchanged sentences
Our operating cash flows are also impacted by distribution decisions made by our equity affiliates.
−Removed: During the first three months of 2026, cash from operations included aggregate distributions of $166 million from our equity affiliates, while cash from operations during the first three months of 2025 included aggregate distributions of $273 million from our equity affiliates.
+Added: During the first six months of 2026, cash from operations included aggregate distributions of $287 million from our equity affiliates, while cash from operations during the first six months of 2025 included aggregate distributions of $501 million from our equity affiliates.
We cannot control the amount of future dividends from equity affiliates;
11 unchanged sentences
or (b) the reference rate (as described in the Term Loan Agreement) plus an applicable margin of 0.100%.
−Removed: At March 31, 2026, the entire $2.25 billion was borrowed under the Term Loan Agreement, which matures in March 2027.
+Added: At June 30, 2026, $1.25 billion was outstanding under the Term Loan Agreement, which matures in March 2027.
+Added: On July 31, 2026, this amount was fully repaid.
Accounts Receivable Securitization
2 unchanged sentences
During 2025, Phillips 66 Company amended the Receivables Securitization Facility to, among other things, increase the maximum size of the Receivables Securitization Facility to $1.25 billion and extend the term of the facility through September 28, 2026.
−Removed: On March 13, 2026, Phillips 66 Company amended the Receivables Securitization Facility to, among other things, increase the maximum size of the Receivables Securitization Facility from $1.25 billion to $1.75 billion and permit P66 Receivables to request a future increase in the maximum facility size to up to $2.0 billion.
+Added: On March 13, 2026, Phillips 66 Company amended the Receivables Securitization Facility to, among other things, increase the maximum size of the Receivables Securitization Facility from $1.25 billion to $1.75 billion and permit P66 Receivables to request a future increase in the maximum facility size up to $2 billion.
Under the amended Receivables Securitization Facility, P66 Receivables may borrow and incur indebtedness from, and/or sell certain accounts receivable in an amount not to exceed $1.75 billion in the aggregate, and will secure its obligations with a pledge of undivided interests in such receivables, together with related security and interests in the proceeds thereof, to PNC Bank, National Association, as Administrative Agent, for the benefit of the secured parties thereunder.
Accounts receivable outstanding under the Receivables Securitization Facility accrue interest at an adjusted term SOFR plus the applicable margin.
−Removed: In all instances, Phillips 66 Company retains the servicing of the accounts receivables transferred.
+Added: In all instances, Phillips 66 Company retains the servicing of the accounts receivable transferred.
Accounts receivable sold under the Receivables Securitization Facility meet the sale criteria under ASC 860, Transfers and Servicing, and are derecognized from the consolidated balance sheet.
P66 Receivables guarantees payment, in full, for accounts receivable sold to the purchasers.
−Removed: For the three months ended March 31, 2026, we sold $264 million of accounts receivable in exchange for a $264 million reduction in our borrowings under the Receivables Securitization Facility, which was recognized as a non-cash financing transaction.
−Removed: For the three months ended March 31, 2025, we sold $130 million of accounts receivables for cash proceeds under the Receivables Securitization Facility.
−Removed: We recognized immaterial charges associated with the transfers of financial assets, which are included as a component within the line item “Selling, general and administrative expense” on our consolidated statement of income, during the three months ended March 31, 2026 and 2025.
+Added: For the three months ended June 30, 2026, we sold $342 million of accounts receivable for cash proceeds.
+Added: For the six months ended June 30, 2026, we sold $606 million of accounts receivable in exchange for cash proceeds of $342 million and a $264 million reduction in our borrowings under the Receivables Securitization Facility, which was recognized as a non-cash financing transaction.
+Added: For the three months ended June 30, 2025, we sold $303 million of accounts receivable in exchange for a $303 million reduction in our borrowings under the Receivables Securitization Facility, which was recognized as a non-cash financing transaction.
+Added: For the six months ended June 30, 2025, we sold $433 million of accounts receivable in exchange for cash proceeds of $130 million and a $303 million reduction in our borrowings under the Receivables Securitization Facility.
+Added: We recognized immaterial charges associated with the transfers of financial assets, which are included as a component within the line item “Selling, general and administrative expenses” on our consolidated statement of income, during the three and six months ended June 30, 2026 and 2025.
Borrowings under the Receivables Securitization Facility are recognized as short-term debt on the consolidated balance sheet.
Borrowings are secured by the accounts receivable, held by P66 Receivables, which remain reported as accounts receivable on the consolidated balance sheet.
−Removed: At March 31, 2026, and December 31, 2025, we had outstanding borrowings of $384 million and $200 million, respectively.
−Removed: These borrowings were secured by accounts receivable held by P66 Receivables of $5.4 billion and $4.4 billion as of March 31, 2026, and December 31, 2025, respectively, which are included within the “Accounts and notes receivable” line item on our consolidated balance sheet.
−Removed: At March 31, 2026, we had utilized $650 million of the $1.75 billion capacity of the Receivables Securitization Facility from $266 million of sold accounts receivable not yet remitted to the Administrative Agent and $384 million of outstanding borrowings.
+Added: At June 30, 2026, we had no outstanding borrowings under the Receivables Securitization Facility.
+Added: We had outstanding borrowings of $200 million at December 31, 2025, which were secured by accounts receivable held by P66 Receivables of $4.4 billion included within the “Accounts and notes receivable” line item on our consolidated balance sheet.
+Added: At June 30, 2026, we had utilized $346 million of the $1.75 billion capacity of the Receivables Securitization Facility, all of which was from sold accounts receivable not yet remitted to the Administrative Agent.
At December 31, 2025, we had utilized $367 million of the $1.25 billion capacity of the Receivables Securitization Facility from $167 million of sold accounts receivable not yet remitted to the Administrative Agent and $200 million of outstanding borrowings.
Accounts Receivable Factoring
−Removed: In addition to the Receivables Securitization Facility, discussed in Note 9—Debt, the Company maintains other accounts receivable factoring facilities with various financial institutions that enable the Company to sell certain eligible accounts receivable to these financial institutions on a non-recourse basis in which we retain the servicing of the accounts receivable transferred.
+Added: In addition to the Receivables Securitization Facility, discussed in Note 9—Debt, Phillips 66 maintains other accounts receivable factoring facilities with various financial institutions that enable Phillips 66 to sell certain eligible accounts receivable to these financial institutions on a non-recourse basis for which we retain the servicing of the accounts receivable transferred.
Sales of accounts receivable under these facilities meet the sale criteria under ASC 860, Transfers and Servicing, and are derecognized from the consolidated balance sheet.
Cash receipts from the sale of accounts receivable, received at the time of sale, are classified as cash flows from operating activities.
−Removed: For the three months ended March 31, 2026, we sold $330 million of accounts receivable for cash proceeds under these facilities.
−Removed: We recognized immaterial charges associated with these transfers, which are included as a component within the line item “Selling, general and administrative expense” on our consolidated statement of income for the three months ended March 31, 2026.
−Removed: We had $292 million and $195 million of sold accounts receivable uncollected as of March 31, 2026 and December 31, 2025, respectively, and these amounts were derecognized from our consolidated balance sheet.
+Added: For the three and six months ended June 30, 2026, we sold $1.3 billion and $1.7 billion, respectively, of accounts receivable for cash proceeds under these facilities.
+Added: As of June 30, 2026, and December 31, 2025, $636 million and $195 million, respectively, remained uncollected of the total accounts receivable sold and derecognized from the consolidated balance sheet.
+Added: We recognized immaterial charges associated with these transfers, which are included as a component within the line item “Selling, general and administrative expenses” on our consolidated statement of income for the three and six months ended June 30, 2026.
Credit Facilities and Commercial Paper
7 unchanged sentences
On March 26, 2026, Phillips 66 amended the 2025 Uncommitted Facility to increase the capacity by $100 million.
−Removed: At March 31, 2026, the entire $300 million was outstanding, while at December 31, 2025, no borrowings were outstanding under the 2025 Uncommitted Facility.
+Added: At June 30, 2026, and December 31, 2025, no borrowings were outstanding under the 2025 Uncommitted Facility.
On June 25, 2024, we entered into a $400 million uncommitted credit facility (the 2024 Uncommitted Facility) with Phillips 66 Company as the borrower and Phillips 66 as the guarantor.
4 unchanged sentences
We may at any time prepay outstanding borrowings, in whole or in part, without premium or penalty.
−Removed: At March 31, 2026, and December 31, 2025, no borrowings were outstanding under the 2024 Uncommitted Facility.
+Added: At June 30, 2026, and December 31, 2025, no borrowings were outstanding under the 2024 Uncommitted Facility.
On February 28, 2024, we entered into a new $5 billion revolving credit agreement (the Facility) with Phillips 66 Company as the borrower and Phillips 66 as the guarantor and a scheduled maturity date of February 28, 2029.
7 unchanged sentences
We also have the option to extend the scheduled maturity of the Facility for up to two additional one-year terms, subject to, among other things, the consent of the lenders holding the majority of the commitments and of each lender extending its commitment.
−Removed: Outstanding borrowings under the Facility bear interest at either:
−Removed: (a) the adjusted term SOFR (as described in the Facility) in effect from time to time plus the applicable margin;
+Added: Outstanding borrowings under the Facility bear interest at either (a) the adjusted term SOFR (as described in the Facility) in effect from time to time plus the applicable margin;
or (b) the reference rate (as described in the Facility) plus the applicable margin.
−Removed: The pricing levels for the commitment fee and interest-rate margins are determined based on the ratings in effect for our senior unsecured long-term debt from time to time.
−Removed: At March 31, 2026, and December 31, 2025, no amount had been drawn under the Facility.
+Added: The pricing levels for the commitment fee and interest-rate margins are determined
+Added: based on the ratings in effect for our senior unsecured long-term debt from time to time.
+Added: At June 30, 2026, and December 31, 2025, no amount had been drawn under the Facility.
Phillips 66 also has a $5 billion uncommitted commercial paper program for short-term working capital needs that is supported by the Facility.
Commercial paper maturities are contractually limited to less than one year.
−Removed: At March 31, 2026, we had $5 billion borrowings outstanding under this program, while at December 31, 2025, $200 million of commercial paper had been issued under this program.
+Added: At June 30, 2026, no borrowings were outstanding under this program, while at December 31, 2025, $200 million of commercial paper had been issued under this program.
Total Committed Capacity Available
−Removed: At March 31, 2026, and December 31, 2025, we had approximately $0.8 billion and $5.7 billion, respectively, of total committed capacity available under the credit facilities described above.
−Removed: At March 31, 2026, and December 31, 2025, we had $6 billion and $6.8 billion of total liquidity, respectively, including cash and cash equivalents and total committed capacity available under credit facilities.
−Removed: Although our total liquidity remained strong, given the uncertainty from geopolitical events in the Middle East during the first quarter of 2026 we shifted to prioritizing cash and cash equivalents over committed capacity available under credit facilities.
+Added: At June 30, 2026, and December 31, 2025, we had approximately $6.4 billion and $5.7 billion, respectively, of total committed capacity available under the credit facilities described above.
Investment Dispositions
6 unchanged sentences
Under the operating lease agreement for our headquarters facility in Houston, Texas, we have the option, at the end of the lease term in September 2030, to request to renew the lease, purchase the facility or assist the lessor in marketing it for resale.
−Removed: This agreement includes a residual value guarantee with a maximum potential future exposure of $404 million at March 31, 2026.
−Removed: In addition, we have residual value guarantees associated with railcar, airplane and truck leases with maximum potential future exposures totaling $176 million.
+Added: This agreement includes a residual value guarantee with a maximum potential future exposure of $404 million at June 30, 2026.
+Added: In addition, we have residual value guarantees associated with railcar, airplane and truck leases with maximum potential future exposures totaling $174 million at June 30, 2026.
These leases have remaining terms of one to ten years.
1 unchanged sentence
In 2020, the trial court presiding over litigation brought by the Standing Rock Sioux Tribe (the Tribe) ordered the U.S.
−Removed: Army Corps of Engineers (USACE) to prepare an Environmental Impact Statement (EIS) addressing environmental impacts from an easement allowing the passage of the Dakota Access Pipeline (DAPL) under Lake Oahe in North Dakota.
−Removed: Later in 2020, the trial court vacated the easement, but operations have been allowed to continue while the USACE proceeds with the EIS as ordered.
−Removed: The Tribe’s requests for a shutdown have been denied.
−Removed: In March 2025, the trial court dismissed a second lawsuit filed by the Tribe, again challenging USACE’s allowance of pipeline operations while the EIS process proceeds.
−Removed: The Tribe’s lawsuit was premature, and the trial court held that it cannot be refiled until after a final EIS is issued.
−Removed: In December 2025, the USACE published its final EIS, completing its analysis of alternatives.
−Removed: The final EIS evaluates five alternatives:
−Removed: two no-action alternatives (denial with restoration or abandonment) and three action alternatives, with one marked as USACE’s preferred alternative, that would grant the easement under varying conditions.
−Removed: The preferred alternative would grant the easement subject to the same conditions as the 2017 easement but would authorize an increased throughput volume of 1.1 million barrels per day (bpd), up from the previous 570,000 bpd under the original authorization.
−Removed: The remaining action alternatives would impose either additional operational conditions or require an alternate pipeline route, both of which may entail substantial implementation costs and could have a material impact on our financial statements.
−Removed: We are still awaiting a Record of Decision (ROD), which will provide a definitive statement of the selected alternative and any related conditions.
−Removed: The Tribe and affiliated parties may file a new lawsuit in Washington, D.C., challenging the ROD shortly after it is issued.
−Removed: Most recently, the Tribe has appealed the dismissal, but the issuance of the ROD will supersede and effectively moot the appeal.
+Added: Army Corps of Engineers (USACE) to prepare an Environmental Impact Statement (EIS) addressing environmental impacts from the Dakota Access Pipeline (DAPL) easement under Lake Oahe;
+Added: although the easement was later vacated, operations have continued while USACE completed the EIS process, and the Tribe’s shutdown requests were denied.
+Added: The final EIS, published in December 2025, laid out multiple alternatives, including denial, abandonment, continued operation under the 2017 conditions, continued operation with additional conditions and a reroute.
+Added: In May 2026, the USACE issued the signed Record of Decision (ROD), which authorizes continued operation under a new easement with enhanced safety and environmental conditions.
+Added: More specifically, the ROD requires mitigation measures beyond the 2017 easement, including alternative water supply planning, groundwater monitoring, biannual Lake Oahe surveillance, fish tissue sampling after a release, eagle-protection measures, periodic independent expert review of leak detection technologies, emergency food distribution planning for affected Tribal communities and continued Tribal engagement on subsistence-use studies.
+Added: The costs to comply with these additional mitigation measures are minimal and are not expected to have a material impact on our financial statements.
+Added: During the final EIS process, the Tribe flagged ETCO’s potential future Canadian crude shipments through DAPL, but ETCO told USACE there are no confirmed plans and none would occur before late 2028 or early 2029 without regulatory and shipper approvals.
+Added: USACE found the issue did not require supplemental environmental review or alter its selected alternative, but added a condition requiring ETCO to submit updated reports and oil-consumption documentation for USACE review before transporting materially different crude through Lake Oahe.
+Added: Because the ROD has been issued, challenges to USACE’s final decision and environmental analysis may now be brought forward.
+Added: The Tribe and potentially affiliated environmental groups could file a new challenge in federal district court in Washington, D.C.
Dakota Access and ETCO have guaranteed repayment of senior unsecured notes issued by a wholly owned subsidiary of Dakota Access.
−Removed: At March 31, 2026, the aggregate principal amount outstanding of Dakota Access’ senior unsecured notes was $850 million.
+Added: At June 30, 2026, the aggregate principal amount outstanding of Dakota Access’ senior unsecured notes was $850 million.
In addition, Phillips 66 Partners LP (Phillips 66 Partners), a wholly owned subsidiary of Phillips 66, and its co-venturers in Dakota Access also provided a Contingent Equity Contribution Undertaking (CECU) in conjunction with the notes offering.
−Removed: Under the CECU, the co-venturers may be severally required to make proportionate equity contributions to Dakota Access if there is an unfavorable final judgment in the above-mentioned ongoing litigation.
−Removed: At March 31, 2026, our 25% share of the maximum potential equity contributions under the CECU was approximately $215 million.
+Added: At June 30, 2026, our 25% share of the maximum potential equity contributions under the CECU was approximately $215 million.
If the pipeline is required to cease operations, it may have a material adverse effect on our results of operations and cash flows.
−Removed: Should operations cease and Dakota Access and ETCO not have sufficient funds to pay its expenses, we also could be required to support our 25% share of the ongoing expenses, including scheduled interest payments on the notes of approximately $10 million annually, in addition to the potential obligations under the CECU at March 31, 2026.
+Added: Should operations cease and Dakota Access and ETCO not have sufficient funds to pay its expenses, we also could be required to support our 25% share of the ongoing expenses, including scheduled interest payments on the notes of approximately $10 million annually, in addition to the potential obligations under the CECU at June 30, 2026.
See Note 6—Investments, Loans and Long-Term Receivables for additional information regarding our investments in Dakota Access and ETCO and Note 11—Guarantees for additional information regarding our guarantees, in the Notes to Consolidated Financial Statements.
3 unchanged sentences
Debt Financing
−Removed: Our debt balance at March 31, 2026, and December 31, 2025, was $27.1 billion and $19.7 billion, respectively.
−Removed: Our total debt-to-capital ratio was 48% and 39% at March 31, 2026, and December 31, 2025, respectively.
+Added: Our debt balance at June 30, 2026, and December 31, 2025, was $20.6 billion and $19.7 billion, respectively.
+Added: Our total debt-to-capital ratio was 39% at June 30, 2026, and December 31, 2025.
+Added: On June 30, 2026, Phillips 66 Company repaid $1 billion of the outstanding $2.25 billion borrowed under its term loan that matures in March 2027.
On February 17, 2026, upon maturity, Phillips 66 repaid the remaining $100 million outstanding on its 1.300% Senior Notes due February 2026, with an aggregate principal amount of $500 million.
−Removed: On April 28, 2026, we acquired the assets and associated infrastructure of the Lindsey Oil Refinery for a purchase price of approximately $115 million, subject to certain closing adjustments including, but not limited to, the purchase of the associated inventory with the assets acquired.
−Removed: On February 11, 2026, our Board of Directors declared a quarterly cash dividend of $1.27 per common share.
−Removed: This dividend was paid on March 4, 2026, to shareholders of record at the close of business on February 25, 2026.
+Added: We may from time to time reduce our outstanding debt and level of interest expense through redemption of debt securities prior to maturity or repurchases of debt securities in the open market, in privately negotiated transactions, through tender offers or otherwise.
+Added: On April 28, 2026, we acquired the assets and associated infrastructure of the Lindsey Oil Refinery for a purchase price of $115 million.
+Added: This acquisition will provide storage and other infrastructure assets to enhance Humber Refinery operations and improve fuel supply to U.K.
+Added: customers upon integration with the Humber Refinery.
+Added: See Note 7—Properties, Plants and Equipment, in the Notes to Consolidated Financial Statements for additional information.
On April 17, 2026, our Board of Directors declared a quarterly cash dividend of $1.27 per common share.
−Removed: This dividend is payable on June 1, 2026, to shareholders of record as of the close of business on May 18, 2026.
+Added: This dividend was paid on June 1, 2026, to shareholders of record as of the close of business on May 18, 2026.
+Added: On July 9, 2026, our Board of Directors declared a quarterly cash dividend of $1.27 per common share.
+Added: This dividend is payable on September 1, 2026, to shareholders of record as of the close of business on August 18, 2026.
Share Repurchases
+Added: On July 29, 2026, our Board of Directors approved a $10 billion increase to our share repurchase authorization.
Since July 2012, our Board of Directors has authorized an aggregate of $35 billion of repurchases of our outstanding common stock under our share repurchase program.
Our share repurchase authorizations do not expire.
−Removed: Any future share repurchases will be made at the discretion of management and will depend on various factors including our share price, results of operations, financial condition and cash required for future business plans.
−Removed: For the three months ended March 31, 2026, we repurchased 2 million shares at an aggregate cost of approximately $0.3 billion.
+Added: Any future share repurchases will be made at the company’s discretion, subject to market conditions and other factors, and in accordance with applicable regulatory requirements.
+Added: For the six months ended June 30, 2026, we repurchased 4 million shares at an aggregate cost of approximately $0.6 billion.
Since July 2012, we have repurchased 252 million shares under our share repurchase program at an aggregate cost of $23.3 billion.
1 unchanged sentence
Employee Benefit Plan Contributions
−Removed: During the three months ended March 31, 2026, we contributed $10 million to our U.S.
−Removed: pension and other postretirement benefit plan.
+Added: During the six months ended June 30, 2026, we contributed $15 million to our U.S.
+Added: pension and other postretirement benefit plans and $3 million to our international pension plans.
We currently expect to make additional contributions of approximately $185 million to our U.S.
2 unchanged sentences
Millions of Dollars
−Removed: Three Months Ended March 31
+Added: Six Months Ended
Capital Expenditures and Investments
9 unchanged sentences
* On October 1, 2025, we acquired the remaining 50% equity interest in WRB from Cenovus.
−Removed: As such, 100% of WRB’s capital expenditures and investments for the first quarter of 2026 are included in Refining capital expenditures and investments.
+Added: As such, 100% of WRB’s capital expenditures and investments for the first six months of 2026 are included in Refining capital expenditures and investments.
** Includes cost associated with the redevelopment of our idled Los Angeles Refinery site.
*** Our share of joint ventures’ capital spending.
−Removed: During the first three months of 2026, capital spending in our Midstream segment was $343 million and included:
−Removed: • Sanctioned construction of a new gas processing plant in the Permian and associated supporting infrastructure.
−Removed: • Gathering and processing projects to further align our wellhead-to-market strategy.
−Removed: • Spending associated with other reliability and maintenance projects in our Transportation and NGL businesses.
−Removed: During the first three months of 2026, on a 100% basis, CPChem’s capital expenditures and investments were $266 million.
+Added: During the first six months of 2026, capital spending in our Midstream segment was $771 million.
+Added: Capital spending was primarily related to sanctioned construction of new gas processing plants in the Permian Basin and associated supporting infrastructure, gathering and processing projects to further align our wellhead-to-market strategy and spending associated with other reliability and maintenance projects in our Transportation and NGL businesses.
+Added: During the first six months of 2026, on a 100% basis, CPChem’s capital expenditures and investments were $524 million.
Capital spending was primarily for the development of petrochemical projects on the U.S.
−Removed: Gulf Coast and in the Middle East, as well as sustaining, debottlenecking and optimization projects on existing assets.
+Added: Gulf Coast and in the Middle East, as well as sustaining and optimization projects on existing assets.
CPChem’s capital program was self-funded, and we expect CPChem to continue self-funding its capital program for the remainder of 2026.
−Removed: Capital spending for the Refining segment during the first three months of 2026 was $210 million.
+Added: Capital spending for the Refining segment during the first six months of 2026 was $465 million.
Major capital activities included spend to improve reliability at our refineries and installation of facilities to improve market capture, product value and utilization.
Marketing and Specialties
−Removed: Capital spending for the M&S segment during the first three months of 2026 was $9 million, primarily for the continued development and enhancement of retail sites in the United Kingdom and marketing-related information technology enhancements.
+Added: Capital spending for the M&S segment during the first six months of 2026 was $29 million, primarily for marketing-related information technology enhancements, spend associated with marketing and commercial fleet fueling businesses on the U.S.
+Added: West Coast and the continued development and enhancement of retail sites in the United Kingdom.
Renewable Fuels
−Removed: Capital spending for the Renewable Fuels segment during the first three months of 2026 was $10 million.
+Added: Capital spending for the Renewable Fuels segment during the first six months of 2026 was $16 million.
The capital spending was focused on product mix optimization, logistics and improving feed flexibility on existing assets.
Corporate and Other
−Removed: Capital spending for Corporate and Other during the first three months of 2026 was $10 million, primarily related to redevelopment costs for the idled Los Angeles Refinery site, as well as information technology.
+Added: Capital spending for Corporate and Other during the first six months of 2026 was $27 million, primarily for redevelopment costs related to the idled Los Angeles Refinery site, as well as information technology.
Contingencies
25 unchanged sentences
On October 16, 2024, a jury returned a verdict against Phillips 66 Company for $604.9 million in compensatory damages and issued a willfulness finding.
−Removed: Based on the willfulness finding, Propel Fuels asked the Propel Court to award $1.2 billion in exemplary damages, and Phillips 66 Company filed a brief in opposition to that request.
−Removed: A hearing on exemplary damages was held on March 4, 2025, and the Propel Court awarded Propel Fuels $195 million in exemplary damages on July 30, 2025.
+Added: Based on the willfulness finding, the Propel Court later granted Propel Fuels’ requests for exemplary damages and attorney’s fees and costs.
On August 5, 2025, the Propel Court entered a final judgment against Phillips 66 Company in the amount of $833 million.
1 unchanged sentence
From the date of final judgment, post-judgment interest of 10% is accruing, which is included within the “Selling, general and administrative expenses” line on our consolidated statement of income and reported in the M&S segment.
−Removed: On August 25, 2025, Phillips 66 Company filed three post-trial motions requesting that the Propel Court render judgment in favor of Phillips 66 Company, grant a new trial, and/or reduce the damages award.
−Removed: On October 20, 2025, the Propel Court denied Phillips 66 Company’s motions.
On November 14, 2025, Phillips 66 Company filed its Notice of Appeal, which has been assigned to Division Two of the First District Court of Appeal.
−Removed: Phillips 66 Company intends to file its opening appellate brief in accordance with the applicable appellate deadlines and any extensions thereto.
−Removed: Separately, on October 24, 2025, Propel Fuels filed additional motions with the Propel Court seeking attorney’s fees and costs.
−Removed: Phillips 66 Company filed its opposition to that request on January 13, 2026.
−Removed: The Propel Court heard argument on the motions on February 10, 2026, and took the motions under submission.
+Added: On July 10, 2026, Phillips 66 Company filed its opening brief with the Court of Appeal.
Phillips 66 Company denies any wrongdoing and intends to vigorously defend its position.
−Removed: The accrued amounts totaling $887 million and $867 million as of March 31, 2026 and December 31, 2025, respectively, are reflected as “Other liabilities and deferred credits” on our consolidated balance sheet.
+Added: The accrued amounts totaling $928 million and $867 million as of June 30, 2026, and December 31, 2025, respectively, are reflected as “Other liabilities and deferred credits” on our consolidated balance sheet.
However, it is reasonably possible that the estimate of the loss could change based on the progression of the case, including the appeal s process.
6 unchanged sentences
We can fulfill our obligation under the Renewable Fuel Standard (RFS) through blending renewable fuels into the motor fuels we produce, producing renewable fuels at the Rodeo Complex, or through purchasing RINs on the open market.
−Removed: For the three months ended March 31, 2026, we incurred expenses of $159 million associated with our obligation to purchase RINs in the open market to comply with the RFS for our wholly owned refineries.
+Added: For the six months ended June 30, 2026, we incurred expenses of $269 million associated with our obligation to purchase RINs in the open market to comply with the RFS for our wholly owned refineries.
These expenses are included within the “Purchased crude oil and products” line item on our consolidated statement of income.
−Removed: For the three months ended March 31, 2025, we primarily fulfilled our obligation under RFS through blending renewable fuels into the motor fuels we produced or by renewable fuels produced at the Rodeo Complex and incurred no expenses to purchase RINs in the open market to comply with RFS for our wholly owned refineries.
−Removed: Prior to the acquisition of WRB in October 2025, our jointly owned refineries also incurred expenses associated with the purchase of RINs in the open market, of which our share was $74 million for the three months ended March 31, 2025.
−Removed: These expenses are included within the “Equity in earnings of affiliates” line item on our consolidated statement of income.
+Added: For the six months ended June 30, 2025, we primarily fulfilled our obligation under RFS through blending renewable fuels into the motor fuels we produced or by renewable fuels produced at the Rodeo Complex and incurred no expenses to purchase RINs in the open market to comply with RFS for our wholly owned refineries.
+Added: Prior to the acquisition of WRB in October 2025, our jointly owned refineries also incurred expenses associated with the purchase of RINs in the open market, of which our share was $175 million for the six months ended June 30, 2025, and were included within the “Equity in earnings of affiliates” line item on our consolidated statement of income.
The amount of these expenses and fluctuations between periods is primarily driven by the market price of RINs, refinery and renewable fuels production, blending activities and renewable volume obligation requirements.
2 unchanged sentences
These requests, notices and lawsuits assert potential liability for remediation costs at various sites that typically are not owned by us, but allegedly contain wastes attributable to our past operations.
−Removed: At December 31, 2025, we reported that we had been notified of potential liability under CERCLA and comparable state laws at 17 sites within the United States and Puerto Rico.
−Removed: There were no changes reported during the first quarter of 2026, thus, leaving 17 unresolved sites with potential liability at March 31, 2026.
+Added: At March 31, 2026, we reported that we had been notified of potential liability under CERCLA and comparable state laws at 17 sites within the United States and Puerto Rico.
+Added: There were no changes reported during the second quarter of 2026, thus, leaving 17 unresolved sites with potential liability at June 30, 2026.
Notwithstanding any of the foregoing, and as with other companies engaged in similar businesses, environmental costs and liabilities are inherent concerns in certain of our operations and products, and there can be no assurance that those costs and liabilities will not be material.
10 unchanged sentences
We have various cross guarantees between Phillips 66 and its wholly owned subsidiary Phillips 66 Company (together, the Obligor Group) with respect to publicly held debt securities.
−Removed: Phillips 66 conducts substantially all of its operations through subsidiaries, including Phillips 66 Company, and those subsidiaries generate substantially all of its operating income and cash flow.
+Added: Phillips 66 conducts substantially all of its operations through subsidiaries, including Phillips 66 Company, and those subsidiaries generate substantially all of its operating income and cash flows.
Phillips 66 has fully and unconditionally guaranteed the payment obligations of Phillips 66 Company with respect to its publicly held debt securities.
1 unchanged sentence
All guarantees are full and unconditional.
−Removed: At March 31, 2026, $15.9 billion of publicly held debt securities has been guaranteed by the Obligor Group.
+Added: At June 30, 2026, $15.9 billion of publicly held debt securities has been guaranteed by the Obligor Group.
Summarized financial information of the Obligor Group is presented on a combined basis.
2 unchanged sentences
Significant intercompany transactions and receivable/payable balances between the Obligor Group and non-guarantor subsidiaries are presented separately in the summarized financial information.
−Removed: The summarized results of operations for the three months ended March 31, 2026, and the summarized financial position at March 31, 2026, and December 31, 2025, for the Obligor Group on a combined basis were:
−Removed: Summarized Combined Statement of Loss Millions of Dollars
−Removed: Three Months Ended March 31, 2026
+Added: The summarized results of operations for the six months ended June 30, 2026, and the summarized financial position at June 30, 2026, and December 31, 2025, for the Obligor Group on a combined basis were:
+Added: Summarized Combined Statement of Income Millions of Dollars
+Added: Six Months Ended June 30, 2026
Sales and other operating revenues $ 63,574
3 unchanged sentences
Purchased crude oil and products—non-guarantor subsidiaries 27,311
−Removed: Loss before income taxes (384)
−Removed: Net loss (280)
+Added: Income before income taxes 2,543
+Added: Net income 2,000
Summarized Combined Balance Sheet Millions of Dollars
33 unchanged sentences
Coast Worldwide
−Removed: Three Months Ended March 31, 2026
+Added: Three Months Ended June 30, 2026
+Added: Income before income taxes $ 352 953 1,599 158 3,062
+Added: Taxes other than income taxes 16 25 41 6 88
+Added: Depreciation, amortization and impairments 58 67 81 16 222
+Added: Selling, general and administrative expenses 12 8 (5) 10 25
+Added: Operating expenses 314 247 530 53 1,144
+Added: Equity in losses of affiliates 1 — — — 1
+Added: Other segment (income) expense, net (66) (2) (3) 8 (63)
+Added: Proportional share of refining gross margins contributed by equity affiliates
+Added: Realized refining margins $ 707 1,298 2,243 251 4,499
+Added: Total processed inputs ( thousands of barrels )
+Added: 48,969 53,522 75,902 8,467 186,860
+Added: Income before income taxes per barrel ( dollars per barrel )**
+Added: $ 7.20 17.80 21.07 18.69 16.39
+Added: Realized refining margins ( dollars per barrel )***
+Added: 14.44 24.25 29.56 29.65 24.08
+Added: Three Months Ended June 30, 2025
Income (loss) before income taxes $ 49 101 392 (183) 359
Taxes other than income taxes
+Added: 20 24 25 25 94
Depreciation, amortization and impairments
+Added: 53 67 44 282 446
Selling, general and administrative expenses
Operating expenses
+Added: 281 257 146 164 848
+Added: Equity in losses of affiliates 2 — — — 2
Other segment (income) expense, net (33) — (28) 14 (47)
Proportional share of refining gross margins contributed by equity affiliates
+Added: 22 — 212 — 234
Realized refining margins
+Added: $ 402 454 804 308 1,968
Total processed inputs ( thousands of barrels )
49,270 52,111 28,710 21,914 152,005
+Added: Adjusted total processed inputs ( thousands of barrels )*
+Added: 49,270 52,111 51,477 21,914 174,772
Income (loss) before income taxes per barrel ( dollars per barrel )**
2 unchanged sentences
8.16 8.71 15.61 14.06 11.25
−Removed: Three Months Ended March 31, 2025
−Removed: Loss before income taxes $ (199) (333) (50) (355) (937)
+Added: * Adjusted total processed inputs include our proportional share of processed inputs of an equity affiliate.
+Added: ** Income (loss) before income taxes divided by total processed inputs.
+Added: *** Realized refining margins per barrel, as presented, are calculated using the underlying realized refining margin amounts, in dollars, divided by adjusted total processed inputs, in barrels.
+Added: As such, recalculated per barrel amounts using the rounded margins and barrels presented may differ from the presented per barrel amounts.
+Added: † Includes our proportional share of our equity method investment in WRB through September 30, 2025.
+Added: Beginning on October 1, 2025, 100% of Borger Refinery and Wood River Refinery are included in consolidated results.
+Added: Refer to Note 2—Business Combinations, in the Notes to Consolidated Financial Statements for additional information.
+Added: Millions of Dollars, Except as Indicated
+Added: Realized Refining Margins Atlantic Basin/
+Added: Coast Central
+Added: Corridor † West
+Added: Coast Worldwide
+Added: Six Months Ended June 30, 2026
+Added: Income before income taxes $ 719 1,157 1,181 213 3,270
Taxes other than income taxes
3 unchanged sentences
Selling, general and administrative expenses
+Added: 21 9 34 13 77
Operating expenses
1 unchanged sentence
Equity in losses of affiliates 1 — — — 1
+Added: Other segment income, net (57) (2) — (15) (74)
+Added: Proportional share of refining gross margins contributed by equity affiliates
+Added: Realized refining margins
+Added: $ 1,505 1,896 2,559 366 6,326
+Added: Total processed inputs ( thousands of barrels )
+Added: 99,876 106,386 144,302 17,097 367,661
+Added: Income before income taxes per barrel ( dollars per barrel )**
+Added: $ 7.20 10.88 8.18 12.49 8.90
+Added: Realized refining margins ( dollars per barrel )***
+Added: 15.04 17.82 17.73 21.31 17.21
+Added: Six Months Ended June 30, 2025
+Added: Income (loss) before income taxes $ (150) (232) 342 (538) (578)
+Added: Taxes other than income taxes
+Added: 42 59 51 52 204
+Added: Depreciation, amortization and impairments
+Added: 109 139 85 570 903
+Added: Selling, general and administrative expenses
+Added: 14 14 36 14 78
+Added: Operating expenses
+Added: 654 638 294 336 1,922
+Added: Equity in losses of affiliates 4 — 103 — 107
Other segment (income) expense, net (39) 1 (40) 26 (52)
7 unchanged sentences
87,986 89,317 99,752 43,276 320,331
−Removed: Loss before income taxes per barrel ( dollars per barrel )**
+Added: Income (loss) before income taxes per barrel ( dollars per barrel )**
$ (1.70) (2.60) 6.13 (12.43) (2.09)
15 unchanged sentences
Millions of Dollars, Except as Indicated
−Removed: Three Months Ended March 31, 2026 Three Months Ended March 31, 2025
+Added: Three Months Ended
+Added: June 30, 2026 Three Months Ended
+Added: June 30, 2025
International U.S.
1 unchanged sentence
Realized Marketing Fuel Margins
−Removed: Income (loss) before income taxes $ (200) (69) 111 1,117
+Added: Income before income taxes $ 217 232 429 56
Depreciation and amortization 14 1 12 13
4 unchanged sentences
Special items:
−Removed: Net gain on asset disposition — — — (1,017)
+Added: Net (gain) loss on asset dispositions — (110) — 89
Marketing margins 350 90 523 221
3 unchanged sentences
192,410 19,466 184,591 28,560
−Removed: Income (loss) before income taxes per barrel ( dollars per barrel )
+Added: Income before income taxes per barrel ( dollars per barrel )
$ 1.13 11.92 2.32 1.96
4 unchanged sentences
As such, recalculated per barrel amounts using the rounded margins and barrels presented may differ from the presented per barrel amounts.
+Added: Millions of Dollars, Except as Indicated
+Added: Six Months Ended
+Added: June 30, 2026 Six Months Ended
+Added: June 30, 2025
+Added: International U.S.
+Added: International
+Added: Realized Marketing Fuel Margins
+Added: Income before income taxes $ 17 163 540 1,173
+Added: Depreciation and amortization 26 3 25 15
+Added: Selling, general and administrative expenses 500 17 405 137
+Added: Equity in earnings of affiliates (26) (57) (18) (9)
+Added: Other operating revenues* (267) (2) (226) (20)
+Added: Other expense, net 17 1 21 3
+Added: Special items:
+Added: Net gain on asset dispositions — (110) — (928)
+Added: Marketing margins 267 15 747 371
+Added: margin for nonfuel related sales — — — 32
+Added: Realized marketing fuel margins $ 267 15 747 339
+Added: Total fuel sales volumes ( thousands of barrels )
+Added: 367,741 40,556 349,090 56,571
+Added: Income before income taxes per barrel ( dollars per barrel )
+Added: $ 0.05 4.02 1.55 20.74
+Added: Realized marketing fuel margins ( dollars per barrel )**
+Added: 0.73 0.39 2.14 6.00
+Added: * Includes other nonfuel revenues.
+Added: ** Realized marketing fuel margins per barrel, as presented, are calculated using the underlying realized marketing fuel margin amounts, in dollars, divided by sales volumes, in barrels.
+Added: As such, recalculated per barrel amounts using the rounded margins and barrels presented may differ from the presented per barrel amounts.
CAUTIONARY STATEMENT FOR THE PURPOSES OF THE “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
45 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.