Marathon Petroleum plunges after Q3 earnings miss; sees continued high turnaround costs

[Marathon Petroleum To Purchase Hess Gas Stations]
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Marathon Petroleum (MPC [https://seekingalpha.com/symbol/MPC]) -5.1% in Tuesday's trading after reporting weaker than expected Q3 adjusted earnings [https://seekingalpha.com/news/4514052-marathon-petroleum-reports-mixed-q3-results-initiates-fq4-outlook], weighed by elevated maintenance costs despite strong demand and wider refining margins.

Marathon's (MPC [https://seekingalpha.com/symbol/MPC]) results were particularly disappointing as refining peers including Valero, Phillips 66 and HF Sinclair reported better than expected quarterly results.

Q3 net income more than doubled to $1.37 billion, or $4.51/share, from $622 million, or $1.87/share, in the year-earlier quarter, but adjusted income was $915 million, or $3.01/share, missing Wall Street consensus of $3.16/share.

Marathon (MPC [https://seekingalpha.com/symbol/MPC]) said Q3 refining turnaround costs totaled ~$400 million, up from $287 million a year ago, mainly due to higher planned maintenance activity, and the company forecasts turnaround expenses for Q4 at ~$420 million, with activity mainly focused on the West Coast.

Q3 refining operating costs climbed to $5.59/bbl from $5.23/bbl in the prior-year quarter, including a jump in operating costs to $4.70/bbl from $3.96/bbl for the U.S. Gulf Coast.

Downtime at the Galveston Bay refinery, the second-largest by capacity in the U.S., due to a fire in June affected the Gulf Coast capture rate and overall results, CFO John Quaid said on Marathon's (MPC [https://seekingalpha.com/symbol/MPC]) earnings conference call [https://seekingalpha.com/article/4837625-marathon-petroleum-corporation-mpc-q3-2025-earnings-call-transcript], according to Reuters, adding the company expects to spend $200 million this year on a project to upgrade Galveston Bay's distillate processing unit, with another $575 million planned for the next two years.

Marathon's (MPC [https://seekingalpha.com/symbol/MPC]) Q3 refining and marketing margin rose to $17.60/bbl from $14.63/bbl a year earlier, but analysts said West Coast refining margins of $947 million were lower than expected.

The company said it ran its 13 refineries at 95%, up from 94% a year ago, and plans to operate its facilities at 90% of their combined capacity in Q4.

MORE ON MARATHON PETROLEUM

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* Marathon Petroleum: Buybacks Outweigh Q3 Noise [https://seekingalpha.com/article/4837463-marathon-petroleum-buybacks-outweigh-q3-noise]
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