Williams Companies Inc. (WMB) FY2025 10-K and Q2 FY2026 10-Q Summary

Business

From the FY2025 10-K, accession 0000107263-26-000006, unless noted.

Williams owns and operates natural gas infrastructure in the United States. It moves, stores, gathers and processes natural gas for about 800 customers: local distribution utilities, power generators, industrial users, LNG exporters, marketers and producers. Most of its money comes from fees and reservation charges, not from commodity prices. It owns interests in and operates more than 32,000 miles of pipeline across 24 states and the Gulf of America, 35 gas processing plants, 9 NGL fractionation facilities, about 23 million barrels of NGL storage and 423 Bcf of natural gas storage. It is headquartered in Tulsa, Oklahoma, and had 5,987 full-time employees as of February 1, 2026. The annual report is filed jointly by Williams and its two wholly owned interstate pipelines, Transcontinental Gas Pipe Line Company (Transco) and Northwest Pipeline (NWP).

How it makes money.

• Regulated interstate pipelines. Transco, NWP and MountainWest charge FERC-regulated rates. Under straight fixed-variable rate design, nearly all fixed costs and the return on equity are recovered through reservation charges. As a result, changes in gas prices and throughput have limited near-term effect on revenue. Most capacity is held by high-credit-quality customers on long-term firm contracts.
• Gathering and processing. Revenue is mainly fees based on volume. In 2025 about 93% of NGL production volumes were under fee-based contracts and about 7% under keep-whole or percent-of-liquids arrangements, where Williams keeps NGLs and sells them. Some contracts carry minimum volume commitments (MVCs). Volumes depend on producers drilling, mostly in gas-directed basins. The top ten G&P customers made up about 55% of G&P fee revenue and NGL margins in 2025.
• Marketing. Gas and NGL marketing optimizes transportation and storage capacity and is hedged with derivatives. Fair-value accounting on those hedges makes reported earnings volatile.

Segments (each segment's 2025 Modified EBITDA, the measure management uses for segments, is given in the MD&A section below):

• Transmission, Power & Gulf. This is the largest segment.
• Transco: about 9,600 miles from Texas and the Gulf to the New York City area, 20.6 MMdth/d of design capacity and about 188 Bcf of storage. Its three largest customers provided about 22% of 2025 revenue, and Duke Energy alone about 9%.
• NWP: about 3,900 miles in the Pacific Northwest and Rockies, 3.8 MMdth/d. Its three largest customers provided about 52% of revenue, and Puget Sound Energy alone about 31%.
• MountainWest: about 2,200 miles, 8.4 MMdth/d.
• Other assets: a 50% interest in Gulfstream (1.4 Bcf/d to Florida); market-based storage at Gulf Coast Storage (about 120 Bcf) and NorTex (37 Bcf); deepwater Gulf of America gas gathering, crude oil pipelines and production platforms (Williams bought the rest of Gulfstar One in December 2025); and a 10% equity interest in Louisiana LNG plus an 80% interest in Driftwood Pipeline's Line 200, acquired in October 2025 for an initial $378 million.
• Power Innovation: behind-the-meter gas-fired power generation for data-center and industrial customers in Ohio and Utah, sold under 10- to 12.5-year, mostly fixed-price power purchase agreements.
• Interstate throughput averaged 21.0 MMdth/d in 2025, up from 20.2 MMdth/d in 2024.
• Northeast G&P. Gathering, processing and fractionation in the Marcellus and Utica shales, through wholly owned systems (Susquehanna Supply Hub, Flint), the 65%-owned Northeast joint venture (Ohio Valley Midstream, Utica East Ohio Midstream), and equity interests in Bradford Supply Hub, Marcellus South, Laurel Mountain and Blue Racer.
• West. Gathering and processing in the Haynesville (including Louisiana Energy Gateway, 1.8 Bcf/d, placed in service July–August 2025), Wamsutter, Southwest Wyoming, Piceance, DJ Basin, Eagle Ford, Barnett and Permian. It also holds NGL assets near Conway, Kansas and a 50% interest in Overland Pass Pipeline. Consolidated gathering volumes averaged 6.09 Bcf/d in 2025.
• Gas & NGL Marketing Services. Wholesale gas and NGL marketing, storage and transportation optimization. It includes a minority equity interest in Cogentrix (interests in 11 gas-fired power plants), bought in March 2025 for $153 million.
• Other. Upstream oil and gas interests, mainly the Wamsutter properties (more than 90% working interest after the November 2024 Crowheart acquisition), plus corporate activities. The South Mansfield (Haynesville) upstream interests were sold on January 30, 2026 for $398 million plus contingent consideration through 2029.

Regulation. In the Transco rate case (Docket RP24-1035), FERC approved a settlement on December 30, 2025, effective March 1, 2026. The settlement bars new general rate filings before August 31, 2027 and requires Transco to file a new rate case by August 30, 2030. NWP's settlement requires a general rate case with rates effective no later than April 1, 2028. Williams estimates 2026 gas pipeline integrity-management spending at about $210 million, including $141 million at Transco and $57 million at NWP.

Risk factors

From the FY2025 10-K, accession 0000107263-26-000006. The June 30, 2026 10-Q (accession 0000107263-26-000026) states these risk factors have not materially changed.

Business and market

• Supply and demand in the basins served. Pipeline and gathering volumes depend on third-party drilling near Williams' systems. Production from existing wells declines naturally, and Williams does not obtain independent reserve estimates. Demand can fall because of weather, alternative energy sources, efficiency gains or bans on new gas hookups.
• Commodity price volatility. Prices of gas, NGLs, oil and LNG affect upstream, equity-NGL and marketing results, cash flow and access to capital. Sustained very high or very low gas prices could reduce long-term contracts or throughput on Transco and NWP.
• Counterparty credit. A customer bankruptcy can lead to contracts being rejected or renegotiated.
• Customer concentration and contract renewal. Transco's largest customer (Duke Energy, about 9% of 2025 revenue) and NWP's largest (Puget Sound Energy, about 31%) are significant. Firm capacity may be "turned back" when contracts expire and may only be remarketed at discounts. Some services are under long-term fixed-price contracts that cannot be adjusted if costs rise.
• Growth execution, including Power Innovation. Acquisitions may not integrate as planned. Construction risks include rights-of-way, permits, skilled labor, inflation, and tariffs on imported materials such as steel pipe. The power projects add specific risks:
• forecasting data-center power needs, with a risk of stranded assets;
• sourcing turbines and batteries;
• community opposition;
• contractual penalties if power output is not continuous and reliable.
• Joint ventures and non-wholly owned entities. Williams may not control cash reserves, distributions, capital calls or asset sales at partly owned businesses.
• Supplier concentration. Some businesses depend on one supplier or a small number of suppliers for critical goods and services.
• Opposition, ESG scrutiny and climate. Permitting challenges and stakeholder opposition can delay or prevent projects. Climate-related physical and transition risks apply.
• Operational hazards. Risks include weather (especially for offshore Gulf assets), terrorism, cybersecurity incidents, outages at interconnected third-party pipelines, and land rights.
• Stockholder activism. Williams has been the target of a proxy contest before and paid significant costs as a result.

Financing

• Leverage and ratings. Total long-term debt, including the current portion and commercial paper, was $29.4 billion at December 31, 2025 (Transco $5.9 billion, NWP $748 million). A downgrade would raise borrowing costs and could require collateral. Credit-facility covenants cap debt to EBITDA at 5.0x, or 5.5x after qualifying acquisitions.
• Interest rates and capital markets. Higher rates or tighter markets could limit funding for acquisitions and dividends. Some financial institutions restrict lending to fossil-fuel businesses.
• Hedging. Hedges may not be effective and can increase earnings volatility.
• Control of the pipelines. Williams' control over Transco's and NWP's distributions may conflict with those subsidiaries' interests.

Regulatory

• FERC proceedings and rate cases. Complaints or rate decisions could cut pipeline revenue below what is needed to recover costs or earn an adequate return.
• Environmental and climate law. This includes greenhouse gas regulation, PHMSA pipeline safety rules (including recent class-location amendments) and state programs such as Washington's Climate Commitment Act, which requires NWP to buy carbon allowances.

General

• Uninsured losses.
• Difficulty attracting and retaining a qualified workforce.
• No assurance that dividends will continue at expected levels.

Management's discussion, fiscal 2025

From the FY2025 10-K, accession 0000107263-26-000006.

Consolidated results.

• Revenue rose to $11,950 million from $10,503 million in 2024:
• service revenues: $8,348 million, up $720 million (+9%);
• product sales and commodity consideration: $3,482 million, up $357 million;
• commodity derivatives: a $120 million gain, after a $250 million loss in 2024.
• Net income attributable to Williams rose $393 million (+18%) to $2,618 million.

Main drivers of 2025.

• Higher service revenue came from:
• expansion projects: Transco's Regional Energy Access, Southside Reliability Enhancement, Texas to Louisiana Energy Pathway and Southeast Energy Connector; the Whale project in the Gulf; Louisiana Energy Gateway in the Haynesville;
• higher Transco transportation and storage rates and Gulf Coast storage rates;
• acquisitions: the 2024 Discovery acquisition, the $325 million Rimrock DJ Basin purchase (January 2025) and the Saber Haynesville purchase (June 2025).
• Eagle Ford was a partial offset: West segment service revenue there fell $77 million as minimum volume commitment (MVC) revenue declined.
• Equity earnings rose $200 million to $760 million, mainly from the Cogentrix investment and higher results at Blue Racer and Appalachia Midstream.
• Impairments of $212 million in the West: a $176 million write-down of Mid-Continent gathering assets held for sale, and a $36 million write-off of DJ Basin compression and processing assets.
• Other investing income fell $301 million. 2024 had included a $149 million gain on the Aux Sable sale and a $127 million gain on remeasuring Discovery.
• Interest expense rose $78 million to $1,442 million because of new debt.

Segment Modified EBITDA, 2025 vs. 2024

Cash and balance sheet.

• Operating cash flow was $5.9 billion. It funded $4.9 billion of capital expenditures (including the Rimrock, Saber and Driftwood purchases and Power Innovation projects), $2.4 billion of dividends and $0.5 billion of equity-method investments. Net borrowing was $2.4 billion.
• Year-end cash was $63 million, with $1.3 billion of long-term debt due within one year and a working capital deficit of $2.9 billion.
• The quarterly dividend rose from $0.475 (2024) to $0.500 (2025), and the board approved $0.525 for 2026.

Outlook at the time of the 10-K.

• 2026 growth capital and investment spending was guided at $6.1–$6.7 billion, excluding acquisitions and some reimbursable long-lead Power Innovation equipment.
• Expected growth drivers: the Socrates power project, Transco and Gulf expansions, a full year of Louisiana Energy Gateway, higher Haynesville volumes and Northeast G&P growth.
• Expected offsets: the South Mansfield divestiture and contractual step-downs in Eagle Ford minimum volume commitments.

Current quarter, Q2 2026 (three months ended June 30, 2026)

From the Q2 2026 10-Q, accession 0000107263-26-000026.

Headline results

Net income attributable to Williams rose $281 million (+51%) in the quarter. Part of the increase came from gains on asset sales and from derivative mark-to-market:

• a $127 million gain on the June 2026 sale of the Brazos Permian II equity-method investment;
• a further $12 million gain on the South Mansfield sale (the year-to-date South Mansfield gain is $194 million);
• a favorable swing in unrealized commodity-derivative results.

The underlying business also grew. Service revenues rose $111 million (+5%), from expansion projects in the West and Transmission, Power & Gulf segments, higher Northeast JV volumes and higher Gulf Coast storage rates. Partly offsetting this:

• operating and maintenance expense rose $25 million (employee costs and operating taxes);
• interest expense rose $21 million to $371 million;
• income taxes rose because pre-tax income was higher.

Depreciation fell $13 million because of lower Transco depreciation rates and the South Mansfield sale.

Segment Modified EBITDA, Q2 2026 vs. Q2 2025

Six-month cash flow.

• Operating cash flow was $2,979 million (vs. $2,883 million). Higher operating results were partly offset by Transco's April 2026 rate refunds (a net $221 million) and margin requirements.
• Capital expenditures nearly doubled to $3,193 million (from $1,984 million).
• Disposition proceeds were $345 million net, plus $48 million from the February 2026 Mid-Continent gathering sale.

Balance sheet and liquidity at June 30, 2026.

• Liquidity: cash of $203 million; total available liquidity of $4,478 million; commercial paper outstanding of $475 million.
• Debt: long-term debt of $2.2 billion due within one year and $28.1 billion due after one year; working capital deficit of $3.4 billion.
• Debt activity in 2026: new notes issued in January and a $1.1 billion maturity retired on March 2. The revolving credit facility was extended to 2031 in May, alongside a new 364-day facility. The undrawn credit capacity is the bulk of the liquidity figure above.
• Ratings: S&P BBB+ (stable), Moody's Baa2 (positive), Fitch BBB (positive).
• Shareholder returns: the quarterly dividend was $0.525. No shares were repurchased in the quarter; about $1.36 billion remains under the $1.5 billion authorization.

Portfolio moves during the first half.

• Williams completed three sales in the first half: South Mansfield upstream (January), Mid-Continent gathering (February) and the Brazos Permian II equity investment (June).
• Brazos Permian II was paid for mainly in publicly traded limited partner units of the acquirer. Williams must hold the units for at least six months, and they are marked to fair value through earnings.
• In June, Williams also signed an agreement to sell its consolidated Permian gathering assets. They are classified as held for sale, and a gain is expected on closing in Q3 2026.
• Transco paid its rate-case refunds in April and settled Atlantic Sunrise construction litigation. It paid the settlement in April and recovered $22 million from the project's co-owner in May.

Projects and guidance.

• In service: Naughton coal-to-gas conversion (NWP, 98 Mdth/d) in April 2026. Socrates, Williams' first Power Innovation project (556 MW across its North and South facilities in New Albany, Ohio), was under construction at quarter-end, with Socrates North expected in Q4 2026.
• Backlog includes:
• Transco: Southeast Supply Enhancement (1,597 Mdth/d, as early as Q3 2027); Northeast Supply Enhancement (400 Mdth/d, as early as Q4 2027); Leidy Access (183 Mdth/d); Power Express (now 800 Mdth/d, up from 689 Mdth/d in the 10-K; as early as Q3 2030); Dalton Lateral II (up to 460 Mdth/d).
• Driftwood Line 200: 3,100 Mdth/d, as early as Q2 2028.
• Haynesville: Shelby Trough Connector (750 MMcf/d, Q2 2028).
• Power Innovation: Apollo (490 MW), Aquila (520 MW), Socrates the Younger (340 MW) and Neo (682 MW), with in-service dates from the second half of 2027 through 2028.
• Outlook: the 10-Q expects 2026 growth capital and investment spending of $7.3–$7.9 billion, up from $6.1–$6.7 billion in the 10-K. Both ranges are on the same basis, excluding acquisitions and reimbursable long-lead equipment. Management now also lists the Momentum acquisition among the year's expected growth drivers.

Subsequent events

From Note 11 – Subsequent Events, the MD&A, and Part II, Item 5 of the Q2 2026 10-Q (accession 0000107263-26-000026).

• Momentum Midstream acquisition (agreed July 2026; pending as of the 10-Q).
• Parties and price: Williams agreed to buy M6 Midstream LLC ("Momentum") for total consideration of up to $5.5 billion, including about $2 billion of Williams common stock subject to holding restrictions. The Membership Interest Purchase Agreement was signed July 17, 2026 with M6 Midstream Holdings LLC and M6 Midstream Blocker LLC.
• Share consideration: on August 3, 2026 Williams irrevocably elected to issue 26,874,496 shares of common stock as the stock portion, to be issued at closing in an unregistered transaction.
• Assets: Momentum's Haynesville assets include 6 Bcf/d of gathering capacity and 4 Bcf/d of pipeline capacity.
• Closing: the 10-Q says closing is expected later in 2026, subject to customary conditions and regulatory approvals.
• Linked project: the Delta Access expansion along the Transco corridor (2,250 Mdth/d, targeted for Q1 2029) depends on the acquisition being completed.
• Power Innovation joint venture (July 2026).
• Terms: Williams sold a 49% noncontrolling interest in five Power Innovation projects (Socrates, Apollo, Aquila, Socrates the Younger and Neo) for $5.34 billion of committed capital.
• Cash received: Williams received about $3.75 billion in July 2026, with the rest due through early 2027.
• Accounting: because Williams keeps control, the sale is recorded as an equity transaction that increases capital in excess of par value and noncontrolling interests.
• Distributions and buyout: distributions generally follow ownership. Distributions above the investor's target return reduce its investment balance, and Williams has a buyout right between years 7 and 14.
• Other post-quarter project milestones. Socrates South entered service in late July 2026. In July 2026 Transco received authorization under its FERC blanket certificate to proceed with Gillis West (115 Mdth/d, as early as Q4 2026).
• Pending divestiture. The sale of consolidated Permian gathering assets, signed in June 2026 and classified as held for sale, was expected to close with a gain in Q3 2026. Neither the buyer nor the price is disclosed in the 10-Q.