How much did Targa's earnings and EBITDA grow in 2025?

Full-year 2025 net income attributable to Targa was $1,923 million, up 47% from $1,312 million in 2024. Adjusted EBITDA rose 20% to $4,957 million. Growth came mainly from higher Permian natural gas inlet volumes, record NGL pipeline and fractionation volumes, and higher Logistics and Transportation marketing margin, partly offset by lower NGL and condensate prices.

What is Targa's 2026 outlook and what assumptions underlie it?

Targa guided 2026 adjusted EBITDA to $5.4 to $5.6 billion, about 11% growth at the midpoint. The estimate assumes Waha natural gas averages $1.00/MMBtu, NGL composite prices average $0.60/gallon, and crude averages $63/barrel. Lower commodity prices than these assumptions would pressure results, especially in the gathering and processing segment, where weak Waha pricing already caused producer curtailments in Q4 2025.

Is the dividend increase guaranteed, and how big is it?

No. Management said it intends to recommend a quarterly dividend of $1.25 per share ($5.00 annualized), a 25% increase from the $1.00 quarterly rate paid in 2025, starting with the May 2026 payment. This still requires Board approval. Management also expects to keep increasing shareholder returns through higher dividends and opportunistic buybacks.

How heavy is Targa's capital spending, and when will the major projects pay off?

Net growth capex is estimated at about $4.5 billion for 2026, plus about $250 million of net maintenance capex. Major projects include six new Permian plants, the Train 11 to 13 Mont Belvieu fractionators, the Speedway NGL pipeline, and the GPMT LPG export expansion. Management says completion of key large downstream projects in the second half of 2027 should drive meaningful operating leverage. Yeti II (Q4 2027) and Train 13 (Q1 2028) are later additions to the pipeline.

How strong is Targa's balance sheet and liquidity?

As of December 31, 2025, consolidated debt was $17.4 billion, including $17.1 billion of senior unsecured notes. Total liquidity was about $4.1 billion, including $3.3 billion available under the TRGP Revolver, $600 million under the Securitization Facility, and $166 million of cash. Targa redeemed the 6.875% Targa Resources Partners notes due 2029 in January 2026, using proceeds from the November 2025 bond offering. Management describes the balance sheet as investment grade.

TRGP 8-K: Earnings & Results & Regulation FD

01—Abstract

Summary

Summary of the 8-K filed February 19, 2026. Cited figures are marked; the original filing is the authoritative source.

Targa Resources (TRGP) reported record fourth-quarter and full-year 2025 results on February 19, 2026.

Fourth-quarter net income attributable to Targa rose to $545 million^a from $351 million a year earlier, and full-year net income reached $1,923 million versus $1,312 million in 2024. Adjusted EBITDA grew 20% for both the quarter ($1,341 million) and the full year ($4,957 million). Growth was driven by record Permian gathering volumes, higher NGL transportation and fractionation volumes, and stronger Logistics and Transportation marketing margin.

Adjusted free cash flow improved sharply to $539 million^b for 2025 from $140 million in 2024, though fourth-quarter adjusted free cash flow was slightly lower year over year at $47.6 million as growth spending increased. Management guided 2026 adjusted EBITDA to $5.4 billion to $5.6 billion, an 11% increase at the midpoint, and estimated net growth capital expenditures of about $4.5 billion plus roughly $250 million of net maintenance capital. The outlook assumes Waha natural gas at $1.00/MMBtu, NGL composite prices at $0.60/gallon, and crude at $63/barrel.

Management expects to recommend a quarterly dividend of $1.25^c per share ($5.00 annualized, up 25%) beginning with the May 2026 payment, which requires Board approval. Targa also repurchased $642 million of stock in 2025, and about $1.374 billion remained authorized at year-end. Total liquidity was about $4.1 billion and consolidated debt was $17.4 billion, leaving the company positioned to fund growth while increasing shareholder returns.

The filing also highlights a significant project pipeline. Targa closed the $1.25 billion^d Stakeholder Midstream acquisition in January 2026, completed the Bull Moose II plant in October 2025, and expects Falcon II to start in the first quarter of 2026, ahead of schedule. It announced the 275 MMcf/d Yeti II plant (fourth quarter 2027), a new 150 MBbl/d Train 13 fractionator in Mont Belvieu (first quarter 2028), and long-lead orders for two more Permian plants.

Management described the second half of 2027 as the completion point for key large downstream projects, which it expects to drive operating leverage. Key risks include weak Waha gas pricing, which led to temporary producer volume curtailments in the fourth quarter, and commodity price exposure in the NGL and gas businesses.

02—Key points

Key Highlights

Record FY2025 adjusted EBITDA of $4,957 million, up 20% year over year; Q4 2025 adjusted EBITDA of $1,341 million, up 20% year over year and 5% sequentially.
FY2025 net income attributable to Targa of $1,923 million (vs. $1,312 million in 2024); Q4 2025 net income of $545 million (vs. $351 million).
2026 adjusted EBITDA guidance of $5.4 to $5.6 billion (about 11% growth at midpoint), assuming Waha gas at $1.00/MMBtu, NGL at $0.60/gal, and crude at $63/bbl.
2026 net growth capex of about $4.5 billion and net maintenance capex of about $250 million, funding six new Permian plants, three Mont Belvieu fractionators, and related pipeline projects.
Planned 25% dividend increase: management intends to recommend $1.25 per quarter ($5.00 annualized) starting with the May 2026 payment, subject to Board approval.
Adjusted free cash flow of $539 million in FY2025 versus $140 million in FY2024, with $642 million of share repurchases in 2025 and $1.374 billion remaining under authorizations.
Strategic actions: closed the $1.25 billion Stakeholder acquisition in January 2026 and announced Yeti II (Q4 2027) and Train 13 (Q1 2028) to extend growth beyond 2026.

03—Questions

Frequently Asked Questions

How much did Targa's earnings and EBITDA grow in 2025?
Full-year 2025 net income attributable to Targa was $1,923 million, up 47% from $1,312 million in 2024. Adjusted EBITDA rose 20% to $4,957 million. Growth came mainly from higher Permian natural gas inlet volumes, record NGL pipeline and fractionation volumes, and higher Logistics and Transportation marketing margin, partly offset by lower NGL and condensate prices.
What is Targa's 2026 outlook and what assumptions underlie it?
Targa guided 2026 adjusted EBITDA to $5.4 to $5.6 billion, about 11% growth at the midpoint. The estimate assumes Waha natural gas averages $1.00/MMBtu, NGL composite prices average $0.60/gallon, and crude averages $63/barrel. Lower commodity prices than these assumptions would pressure results, especially in the gathering and processing segment, where weak Waha pricing already caused producer curtailments in Q4 2025.
Is the dividend increase guaranteed, and how big is it?
No. Management said it intends to recommend a quarterly dividend of $1.25 per share ($5.00 annualized), a 25% increase from the $1.00 quarterly rate paid in 2025, starting with the May 2026 payment. This still requires Board approval. Management also expects to keep increasing shareholder returns through higher dividends and opportunistic buybacks.
How heavy is Targa's capital spending, and when will the major projects pay off?
Net growth capex is estimated at about $4.5 billion for 2026, plus about $250 million of net maintenance capex. Major projects include six new Permian plants, the Train 11 to 13 Mont Belvieu fractionators, the Speedway NGL pipeline, and the GPMT LPG export expansion. Management says completion of key large downstream projects in the second half of 2027 should drive meaningful operating leverage. Yeti II (Q4 2027) and Train 13 (Q1 2028) are later additions to the pipeline.
How strong is Targa's balance sheet and liquidity?
As of December 31, 2025, consolidated debt was $17.4 billion, including $17.1 billion of senior unsecured notes. Total liquidity was about $4.1 billion, including $3.3 billion available under the TRGP Revolver, $600 million under the Securitization Facility, and $166 million of cash. Targa redeemed the 6.875% Targa Resources Partners notes due 2029 in January 2026, using proceeds from the November 2025 bond offering. Management describes the balance sheet as investment grade.

04—Continue

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