Earnings call transcript: Venture Global Inc Q3 2025 reveals EPS miss, stock surges

Venture Global Inc reported its Q3 2025 earnings, revealing significant revenue growth but a notable miss on earnings per share (EPS). Despite reporting an EPS of $0.16, falling short of the forecasted $0.53, the company saw its stock price surge in pre-market trading by 10.76%, reaching $8.85. This increase follows a 1.88% drop in the previous session, suggesting investor optimism driven by other performance metrics.

Key Takeaways

• Venture Global's Q3 revenue increased by 260% year-over-year, reaching $3.3 billion.
• The company reported a net income of $429 million, a significant turnaround from a $347 million loss in Q3 2024.
• Stock price surged 10.76% in pre-market trading despite an EPS miss.
• Venture Global secured a new $2 billion corporate revolver facility, boosting its financial flexibility.
• Updated EBITDA guidance for 2025 is set between $6.35 billion to $6.50 billion.

Company Performance

Venture Global Inc demonstrated robust performance in Q3 2025, with a significant increase in revenue and a return to profitability. The company reported a 260% rise in revenue compared to the same quarter last year, driven by increased sales volume and operational efficiency. The turnaround in net income, from a loss of $347 million in Q3 2024 to a profit of $429 million, underscores the company's strategic improvements and market positioning.

Financial Highlights

• Revenue: $3.3 billion, up 260% year-over-year
• Net income: $429 million, compared to a $347 million loss in Q3 2024
• EPS: $0.16, a 69.81% miss from the forecasted $0.53
• Consolidated adjusted EBITDA: $1.5 billion, a 439% increase year-over-year

Earnings vs. Forecast

Venture Global's Q3 2025 EPS of $0.16 fell significantly short of the forecasted $0.53, resulting in a negative surprise of 69.81%. This miss contrasts with the company's strong revenue performance and highlights potential areas for improvement in cost management or operational efficiencies.

Market Reaction

Despite the EPS miss, Venture Global's stock experienced a notable pre-market surge of 10.76%, reaching $8.85. This positive reaction may reflect investor confidence in the company's long-term growth prospects and strategic initiatives, such as the new corporate revolver facility and increased production capabilities. The stock's movement contrasts with its 52-week high of $25.5 and low of $6.75, indicating a recovery from recent lows.

Outlook & Guidance

Venture Global updated its 2025 EBITDA guidance to a range of $6.35 billion to $6.50 billion, reflecting continued confidence in its operational strategy and market demand. The company's strategic focus includes expanding its production capacity and securing long-term contracts, positioning it for sustained growth.

Executive Commentary

CEO Mike Sabel highlighted the company's strategic position, stating, "We are positioned to be one of the largest LNG producers in the world." He emphasized the mission to deliver affordable LNG globally, supporting growth and energy transition. Sabel also noted the importance of the SPA market dynamics, describing it as "a voting machine."

Risks and Challenges

• Arbitration proceedings: Ongoing with a liability cap of $765 million, posing potential financial risks.
• Market volatility: Fluctuations in global LNG demand and pricing could impact revenue.
• Execution risks: Delays or cost overruns in capacity expansion projects may affect profitability.
• Regulatory changes: Shifts in environmental regulations could impact operational costs.

Q&A

During the earnings call, analysts inquired about the arbitration proceedings and the company's strategy to manage potential liabilities. Venture Global expressed confidence in handling these outcomes while maintaining strong customer relationships. Analysts also sought clarity on the company's production targets and future contract flexibility, which were addressed with assurances of strategic alignment and growth potential.

Full transcript - Venture Global Inc (VG) Q3 2025:

Joanna: Good morning and welcome to the Venture Global third quarter 2025 earnings conference call. At this time, I would like to turn the conference call over to Ben Nolan, Senior Vice President, Investor Relations. Please go ahead.

Ben Nolan, Senior Vice President, Investor Relations, Venture Global: Thank you, Joanna. Good morning, everyone, and welcome to Venture Global LNG's third quarter 2025 earnings call. I'm joined this morning by Mike Sabel, Venture Global CEO, Executive Co-Chairman and Founder, Jack Thayer, our CFO, and other members of the Venture Global management team. Before I begin, I would like to remind all listeners that our remarks, including answers to your questions, may contain forward-looking statements, and actual results could differ materially from what is described in these statements. I encourage you to refer to the disclaimers in our earnings presentation, which is available on the investor section of our website. Additionally, we may include references to certain non-GAAP metrics, such as consolidated adjusted EBITDA. A reconciliation of these metrics to the most relevant GAAP measures can be found in the appendix of the earnings presentation posted on our website.

Finally, the guidance in this presentation is only effective as of today. In general, we will not update guidance until the following quarter and will not update or affirm guidance other than through broadly disseminated public disclosure. I'll now turn the call over to Michael Sabel.

Mike Sabel, CEO, Executive Co-Chairman and Founder, Venture Global: Thank you, Ben. Good morning, everyone, and thank you for joining us today. We are pleased to share our third quarter 2025 results and update our guidance for 2025, which we believe is proving to be a year of strong project advancement, financial growth, and operating performance for Venture Global. I'll begin the call with an overview of our considerable third quarter 2025 key accomplishments and results before shifting to our LNG projects individually. I will then make some remarks in the LNG industry broadly before turning over the call to Jack, who will provide a more detailed review of our financial results and updated guidance for fiscal year 2025. Following all prepared remarks, we will open the call to Q&A. Turning to page five of the presentation, I'm incredibly proud of what we are building at Venture Global.

Despite only shipping our first cargo in March of 2022, about three and a half years ago, Venture Global is positioned to be one of the largest LNG producers in the world, with expected production capacity of approximately 67 MTPA in operation or under construction today before additional brownfield expansions take us over 100 MTPA. The volume of achievements in our third quarter was nothing short of extraordinary by the team. The coordinated efforts and oversight required at every step of the journey have not been easy, but the team has worked incredibly hard to deliver affordable energy security to our partners throughout the world. We are applying that same level of relentless effort and rigorous execution to grow the business, harness the industry's lowest cost LNG production strategy, and pass that value on to our global customers and trade partners in the market.

Executing and operating at this scale and pace requires significant stakeholder engagement and support, regulatory advocacy, capital access, and most importantly, employee grit. Ours is a company with broad geopolitical impact that is playing a material part in the U.S. efforts to promote energy security and achieve better balance of trade globally. In fact, I just returned from Eastern Europe, where Venture Global executed a geopolitically important agreement to support energy security in the region, which I'll comment on more in a moment. Moving to page six, the past several months demonstrate operational excellence at Calcasieu Pass, the swift ramp-up of production at Plaquemines, while navigating complex construction and commissioning activities and the deployment of significant resources at CP2 as we work to execute for our customers.

These efforts enabled Venture Global to generate $3.3 billion of revenue, $1.3 billion in income from operations, $429 million of net income attributable to common shareholders, and $1.5 billion of consolidated adjusted EBITDA. These results represent increases of 260% for revenue, 598% for income from operations, and 439% for consolidated adjusted EBITDA compared with the third quarter of 2024. It was an exceptional quarter for our company and the team. Considering our success year to date, our market outlook for the fourth quarter and the inclusion of certain non-cash accounting charges for recent potential arbitration awards, we are marginally reducing and tightening the range of our EBITDA guidance for the year.

This update reflects further operating visibility into the number of commissioning cargoes we expect to produce at Plaquemines and the current fixed liquefaction fees we are contracting on those cargoes for the remainder of the year. Presently, we are seeing pricing for winter cargoes, which reflects static TTF prices and higher Henry Hub forwards, implying a compression of winter liquefaction spreads. As you will recall, last quarter, we had set a $1 per MMBTU change in price translated into a $230 million-$240 million change in our anticipated consolidated adjusted EBITDA. As we have contracted additional projected output since the end of our prior quarter, this market sensitivity has declined.

However, this compression of margins on future unsold cargoes during the fourth quarter, plus the timing of two DES loadings, where we load them and deliver them after the quarter, results in us marginally reducing our 2025 guidance range to $6.35 billion-$6.5 billion of consolidated adjusted EBITDA for 2025. This range reflects a forecasted $4.50 per MMBTU-$5.50 per MMBTU fixed liquefaction fee range for available cargoes remaining in the quarter, which is consistent with current TTF and JKM forward price expectations. Additionally, our projected results also incorporate reserve adjustments, which account for our best estimate of the financial impact of the Calcasieu Pass arbitration process. We anticipate updating the market with full year 2026 guidance next quarter. Please turn to page seven.

In my mind, the extraordinary list of accomplishments achieved in the past few months tells the story of Venture Global's unwavering commitment to streamlined high-impact execution in its growth to date. We were able to hit several major milestones, including 100 cargoes exported in a single quarter, and just a few days ago, we shipped our 500th cargo from Calcasieu Pass. Those achievements are remarkable, particularly given the relatively short operating history of the company. While these are significant operating achievements, everything starts with safety. I'm thankful to say that despite the speed at which we are constructing and developing our projects, the total reportable incident rate is still 10 times better than the industry average. In addition to these operational successes, we also made incremental strides in sourcing capital to fund our growth.

Specifically, the Blackfin Joint Venture raised $1.575 billion of financing, which enabled an almost $900 million return of capital to Venture Global. Last Friday, we finalized a new $2 billion revolving credit facility with a dozen banks, which we expect will enhance our corporate liquidity and capital flexibility. These financings build upon the $15.1 billion FID project financing for CP2 phase one and the $4 billion of Plaquemines senior secured notes we completed early in the quarter. Year to date, we have now raised approximately $30 billion and closed eight separate billion-dollar-plus transactions to further grow our business and optimize our capital structure. It has been a truly remarkable year of financing activity for us. I'm also pleased to announce the signing of two new 20-year SPA sales and purchase agreements. On Friday, we signed a one MTPA agreement with Naturgy of Spain for phase two of CP2.

Venture Global is honored to expand our long-term partnership with Spain through this new agreement with Naturgy, a leading global LNG company. This contract will positively impact the U.S. balance of trade with Spain. Our unmatched speed and execution have made Venture Global a trusted, reliable supplier to the global market. The signing of this agreement, along with a strong commercial momentum we've achieved over the past six months, reflects the continued customer confidence in our company and the robust demand for LNG globally. Venture Global remains committed to meeting that demand with flexible, fast, affordable, and dependable long-term supply. Additionally, last Thursday, we signed a 20-year SPA for a minimum of 0.5 MTPA with Atlantic Sea LNG, which is a newly formed joint venture between Greek companies Motor Oil and DEPA, making Greece's first-ever long-term LNG supply agreement with a U.S. exporter.

In combination with our capacity at the Alexandroupolis LNG regasification receiving terminal, this agreement should substantially enhance Central and Eastern European energy security, bringing affordable and reliable U.S. natural gas to the region. Including the three offtake commitments we previously announced and signed in July, Venture Global has now added 5.25 MTPA of new 20-year SPAs in the second half of 2025, which I think might be the most in the market globally. I expect more to follow. We continue to build momentum towards the FID for CP2 phase two. Turning to page nine, we will take a look at our project starting with CP2. As you know, on June 3rd, our team fully mobilized and started site work at CP2 following final approval and notice to proceed from FERC with FID of phase one announced on July 28th.

Additionally, on October 22nd, the final non-FTA export authorization from the U.S. Department of Energy was received. Phase one engineering is 99% complete, allowing for over 98% of all phase one permanent plant equipment to now be procured. FERC has reviewed and approved 97% of all underground and foundation scopes, enabling continuous phase one field execution. The speed and productivity of the team's mobilization to site has been nothing short of extraordinary. There are over 3,500 people and more than 1,700 major pieces of construction equipment on site. Construction progress is on schedule at 98% of all civil site prep and soil improvement work completed across 700 acres. This work includes moving 2 million cubic yards of soil and cement, stabilizing over 6 million cubic yards of soil, utilizing over 580,000 tons of cement.

Piling work has commenced with over 10,000 piles installed to date, representing already one-third of the 32,000 total piles required. To create roads and access support allowing for the start of the foundation work, over 1.2 million tons of aggregate base has been installed. Foundation work is now underway in all major process areas of the facility. The most notable accomplishments include pouring the first LNG tank foundation, the first liquefaction module foundation, and the Power Island switchgear building foundation. Marine terminal work also continues to progress with nearly 2 million cubic yards of dredging completed. Additionally, nearly 5,000 feet of the 22,000-foot perimeter wall has been installed, nearly a mile completed. Off-site, all phase one equipment module erection has commenced both domestically and abroad.

Specifically, I'd like to highlight the notable progress on our pretreatment systems, pipe rack modules, and electrical buildings, all of which we are building in the U.S. Gulf Coast. I'm also pleased to recognize that Baker Hughes has completed the first eight liquefaction trains, which are currently being stored at its fabrication facility in Italy. The team has incorporated our learnings from the construction of Calcasieu Pass and Plaquemines, which is aiding the progress of construction. Some of the modifications include one, utilizing 10 marine offloading facilities near the CP2 project site versus just three when we built Calcasieu Pass, which translates into a much greater speed of deployment and less traffic on the roads. Two, further modularization in new scopes of the project, particularly with respect to the Power Island, a critical path item.

Three, internalizing additional construction scope and more targeted use of subcontractors to improve quality, efficiency, and pace of construction. With respect to phase two, I mentioned the two SPAs we signed in the past few days, and we continue to have constructive conversations with off-takers and aim to sign additional SPAs before the end of the year. As I've said before, given the lower cost per ton of brownfield expansion and our significant equity already invested in phase two of the project, which is now over $1 billion, we do not anticipate needing many more 20-year SPAs to reach FID for either phase two or even beyond that, the phase three bolt-on. This contract strategy is supportive of VG maintaining a balanced portfolio of intermediate, short, and long-term contracts. The targeted FID timeframe for phase two remains the first half of 2026.

On page 10 and 11, we thought it would be helpful to walk through the value proposition of CP2 and all our future projects. On page 10, we have listed some of the attributes that we believe support the company's growth outlook. In short, engineering and construction optimization, access to legacy construction and operation data, and an internal team of experienced personnel promote construction speed and production excellence. This, in turn, generates financial returns faster and allows us to pass this capital efficiency onto our customers through industry-leading pricing. In sum, it's all in support of realizing our corporate mission of innovating to provide low-cost LNG to the world. On page 11, we outline how that speed and efficiency correlate to strong annual returns, even while passing on much of those lower costs to our SPA customers and the market in a variety of LNG pricing environments.

The key to success in any commodity business is being the low-cost producer, which for CP2 phases one and two should be just above $1,000 a ton all in, including our inside-defense power plants, the pipelines, owner's costs, and all other construction costs. Additionally, we generate considerable cash flow during construction and commissioning, which we view as an offset to project cost. In this case, based on the forward Henry Hub and TTF curves, for CP2, we estimate these construction and commissioning pre-COD cargo sale EBITDA proceeds would yield an estimated $8 billion of cash flow during construction, reducing CP2's net cost down to approximately $21 billion. Following COD, cash flows will come from a combination of fixed liquefaction charges under our long-term SPAs and contractor pricing on available capacity in excess of that sold under our 20-year long-term contracts.

In the case of CP2 phases one and two, we expect this available excess production to be 9-11 million tons, which we anticipate selling on a medium and short-term basis or a non-20-year basis. As you can see on the slide, we are showing two fixed liquefaction fee cases, one at $4 per MMBTU and one at $6 for these non-20-year SPA cargoes. Assuming a $4 fixed liquefaction fee, the combination of fixed long-term contribution and that from the available capacity would translate into an estimated $4 billion contribution to annual consolidated adjusted EBITDA. Whereas assuming $6 per MMBTU for the available cargoes, which I believe will be closer to the case over 20 years, the estimated annual consolidated adjusted EBITDA would rise to $5.2 billion.

Collectively, under these scenarios, relative to the $21 billion of net project costs after assuming 50% leverage, where we carry extra equity, these illustrative results imply a return at the project level on equity of greater than 30% while still providing the lowest price SPAs in the market to our customers, which you're now seeing reflected in the high number of 20-year contracts we continue to execute. Moving to page 12, Plaquemines' construction and commissioning continues to progress on schedule for phases one and two. While still relying on temporary power, as we are not in our combined five-on-two configuration for the power plant for phase one yet, construction continues at our Power Island units, and the Venture Global team has now safely started up 34 of the 36 liquefaction trains.

Despite these challenges, our continued construction and commissioning progress enabled Plaquemines to export 64 commissioning cargoes during Q3, hitting the high end of our previously projected range. This represents a 25% increase in exported cargoes relative to the previous quarter, reflecting the remarkable pace at which we are integrating and commissioning liquefaction trains. The facility realized a weighted average fixed liquefaction fee of $6.79 per MMBTU on these commissioning cargoes during the quarter. As we recently communicated to our phase one off-takers, we maintain our expected COD schedule of Q4 2026. Important work remains, but we are making great progress at Plaquemines. For example, the project's required combined cycle power generation equipment for phase one is expected to commence commissioning in its five-on-two configuration in Q1 2026.

This Power Island schedule and other work allows us to have sufficient time to complete commissioning, reach substantial completion under our EPC contract, complete lender reliability testing, and declare COD on schedule. Importantly, over the past several years, we've made incremental project investments in areas like temporary power, which we continue to use today, and a number of other scopes, including Power Island, to address EPC delays, for which we have injected approximately $3.3 billion of additional equity capital in order to hold our COD schedule. That's not new. That's previously reported. These are incremental costs relative to our FID budgets that we've incurred and absorbed as project sponsor to deliver low-cost LNG to our customers years faster than our peers.

I'm pleased to affirm that because of this spend, we are on track for COD in Q4 2026 for phase one and mid-2027 for phase two, reflecting a 54-month construction timeline, which is among the industry's best and will be ever achieved. Including the 144 cargoes exported from Plaquemines in the first three quarters of the year, we now anticipate the facility exporting between 234-238 cargoes by year-end. This puts us in the high end of our previous estimates and represents a seven-cargo increase to the low end and a two-cargo decrease from the high end of our previously reported range. For Q4, Plaquemines has contracted 79 cargoes, or 84% of potential cargoes for the quarter, capturing a weighted average fixed liquefaction fee of $6.41 per MMBTU on those contracted cargoes. On page 13, you see the monthly ramp of Plaquemines' cargoes exported since the beginning of 2025.

Plaquemines accounts for 82% of the incremental LNG production capacity added to the global LNG supply this year, lifting worldwide LNG production by more than 4%. That growth almost single-handedly helped to mitigate the impact of a more than 33% rise in European LNG demand through the first 10 months of the year as the continent seeks to move away from the consumption of Russian gas. I'm grateful for the hard work, ingenuity, and tenacity of our VG construction team, which enabled the ramping of Plaquemines' production despite power and other construction challenges. With production excellence such as this at Plaquemines, we are playing an industry-leading role in keeping LNG prices affordable throughout the world. Next, I'd like to focus on Calcasieu Pass, which is covered on page 14 of the presentation.

During the third quarter of 2025, Calcasieu Pass exported 36 cargoes, which is in line with our previous expectations, but down slightly from the second quarter. The reduction compared to Q2 is due to a longer-than-scheduled routine Power Island maintenance on the facility. This does give us an opportunity to highlight one of the competitive advantages of our mid-scale modular approach. Specifically, because of the performance capacity of our trains and equipment redundancy across our process system and our configuration, we can undertake significant maintenance at our facilities with only very modest impacts on production. This translates into smoother production profiles and lowers operating costs per MMBTU of production. At Calcasieu Pass, we realized a weighted average fixed liquefaction fee of $1.76 per MMBTU in the third quarter.

This is lower than the $1.97 per MMBTU we had published in our October 6th 8-K, as we have incorporated a non-cash $27 million arbitration-related reserve relative to the five and a half months of production since COD in our Q3 results at Calcasieu Pass. For the fourth quarter of 2025, based on liquefaction fees achieved from SPA and excess cargoes sold on a forward basis to date, we anticipate capturing a weighted average liquefaction fee of $2.14 per MMBTU across all forward sold Calcasieu Pass production, which reflects contracted sales under our long-term SPAs, plus an excess cargo that has been sold. That figure includes a Q4 adjustment for arbitration reserves. Incorporating the 108 cargoes exported from this facility in the first half, we now anticipate exporting 148 cargoes by the end of the year.

Collectively, across Calcasieu Pass and Plaquemines, we have contracted 59 more cargoes for export in Q4 2025 since our prior report and have contracted 119 of a potential 134 cargoes, or roughly 89% of our total Q4 2025 production. I want to spend a few minutes updating you all on the Calcasieu Pass arbitration proceedings. While confidentiality agreements do restrict our ability to provide all the details we would like, to the extent we were able, we thought we would provide answers to a number of the common questions we have received. You can see the most frequent of these on page 15. Let me address several. First, there have now been full or partial resolutions in three of the proceedings. As you know, the Shell arbitration was decided in our favor.

We settled the second for an amount which did not have a material impact on Venture Global's results. The arbitration panel reached a partial final decision against Calcasieu Pass and the BP arbitration. There are four separate outstanding proceedings now, which we expect should be determined over the course of the next few years in the absence of settlements. Secondly, no damages have been determined or awarded in the BP arbitration, and the date for the hearing on damages has not been set as of the date of this presentation. Financially, including BP, the remedies sought by our customers against Venture Global Calcasieu Pass, including BP, have been materially reduced to $4.8 billion-$5.5 billion, from $6.7 billion-$7.4 billion. Venture Global Calcasieu Pass's aggregate liability cap under the post-COD SPAs for the four remaining arbitration proceedings, excluding BP, is now $765 million.

Importantly, while we ardently disagree with the BP award, the result does not impact our strategy for growth in providing low-cost LNG to our customers throughout the world. Jack will address the accounting treatment for estimating the financial impact in the form of non-cash reserves of BP and these remaining arbitrations shortly. Turning to page 17, while there has been modest softening of winter 2026 LNG spreads, demand remains healthy and the margins are robust. Even as new LNG supply enters the market over the next several years, we expect prices to remain supportive as energy demand responds to affordable prices. As you can see on the left, the forward curve reflects the market's expectation for LNG prices in both Asia and Europe to remain at considerable spreads above Henry Hub for the next 12 months.

Beyond this timeframe, we continue to see upward revisions to demand that reinforce our belief that margins will reflect insufficient LNG supply through 2028 and beyond. Flipping to page 18, for years, industry pundits have been predicting a plateau in LNG demand, and time and time again, those predictions have not materialized, and demand has continued to grow at record levels. Historically, LNG consumption has grown about 5% to 6% per year. Even assuming a more conservative 3% growth rate, the current slate of new projects would not be sufficient to meet global demand by the middle of the next decade, and in the 5% compound growth rate, which is the historical number, global LNG infrastructure would need to nearly triple to meet global demand.

There certainly may be fluctuations in LNG prices over time, but we remain confident in underlying fundamental demand growth because of the increasing consumption of electricity around the world. Lately, powering AI and data centers globally has been at the front of everyone's minds. While we certainly view that as a major source of global power demand, factors like a rising middle class, which uses air conditioning among lots of other demand, growing industrialization, the continued migration from coal, and moderating growth expectations for renewables, and even more coal are even more core to what we perceive will drive strong LNG demand growth for decades to come. This demand growth also reinforces the importance of our mission to deliver increased volumes of affordable LNG to support this global growth. Now I'll turn it over to our CFO, Jack Thayer, who will review the financials and our updated guidance.

Thank you, Mike, and good morning to those of you on the line. I will be referring to the Venture Global Form 10-Q for the quarterly period ended September 30, 2025. The 10-Q is available on our website, and some of the key results are summarized on page 20 of the presentation. During this call, I will highlight results I believe are salient to this audience, and I encourage you to review the entirety of our financial statements in detail. Beginning with revenue, our top line was $3.3 billion for the third quarter of 2025, a $2.4 billion increase from $0.9 billion during the equivalent period in 2024.

This increase in revenue was driven by $2.9 billion from higher sales volumes, 373 TBTU in third quarter of 2025, compared with 100 TBTU in the third quarter of 2024, primarily at the Plaquemines project, which was partially offset by $517 million from lower net rates at Calcasieu Pass due to the commencement of LNG sales under its post-COD SPAs with weighted average fixed facility fees of $1.76 per MMBTU in the third quarter of 2025 versus $6.67 per MMBTU in the third quarter of 2024, and offset by a weighted average commodity fees of $3.53 per MMBTU in the third quarter of 2025 versus $2.51 per MMBTU in the third quarter of 2024. Our income from operations was $1.3 billion in the third quarter of 2025, a $1.1 billion increase from $189 million in the third quarter of 2024.

This shift was primarily driven by the higher sales volumes I mentioned previously, which resulted in a greater total margin for LNG sold. These increases were partially offset by $102 million of higher operating costs in support of the ramp-up of LNG production at the Plaquemines project and operating our LNG tankers, as well as $28 million and $129 million of higher G&A and depreciation expenses, respectively. We also experienced a reduction in our development expenses of $103 million quarter over quarter as many of the costs associated with our three-phase CP2 project were capitalized. Our net income attributable to common stockholders, which we will refer to as net income, was $429 million for the third quarter of 2025, a $776 million increase from the loss of $347 million in Q3 2024.

Changes in interest rate swaps negatively impacted Q3 results both this year and in 2024 by $144 million and $480 million, respectively, and Q3 2025 net income was also unfavorably impacted by a $100 million accounting charge related to the partial voluntary prepayment of the Plaquemines term loan. Shifting to consolidated adjusted EBITDA, we earned $1.5 billion during the third quarter of 2025, a $1.2 billion, or 439% increase from $283 million in Q3 2024. This increase in consolidated adjusted EBITDA was driven chiefly by higher sales volumes. As Mike Sabel mentioned earlier, our projects exported a total of 100 cargoes in Q3, which increased from 31 cargoes compared with the same period in 2024. Of these cargoes, 372 TBTU of volumes are reflected in our results for Q3 2025, more than tripling production compared to the 110 TBTU in Q3 2024.

I also wanted to further provide information regarding the accounting treatment for the BP and our four remaining outstanding arbitrations impact. As mentioned, our consolidated financial statements incorporate a $27 million non-cash reserve relative to the period from our April 15th COD until the end of Q3. Going forward, the non-cash reserve, which reflects our best estimate of award outcomes from BP and the four remaining arbitrations, is currently estimated to be between $14-$15 million per quarter through the 20-year duration of the SPA contract terms. This amount will directly reduce Calcasieu Pass revenue and flow through EBITDA, although there will be no offsets to net income due to adjustments for non-controlling interest and taxes. Importantly, this is an estimate, and there is no cash impact to our third quarter financial statements.

We will update these estimates in our financials quarterly as we finalize arbitration results and incorporate any financial awards or settlements going forward. Finally, I would like to call out several additional financial updates. Following the $1.575 billion financing of the Blackfin pipeline and an $889 million return of cash to Venture Global, our cash and restricted cash position at the end of the quarter was over $3.5 billion. Also, subsequent to the end of the quarter, we secured a new $2 billion corporate revolver facility. We believe that with this combination of cash on hand, revolver capacity, substantial future cash flow, and substantial future cash flow we expect to generate in coming quarters, and billions of dollars of unencumbered assets, Venture Global is in an excellent liquidity position.

Advancing to page 21 and 22, we are updating our guidance to a consolidated adjusted EBITDA range of $6.35 billion-$6.50 billion for 2025, as we've reduced and tightened the range from our previous guidance range of $6.4 billion-$6.8 billion. We have improved the lower end of our cargo production forecast range by seven cargoes, as we're now incorporating a forecasted 148 cargoes for Calcasieu Pass and 234-238 cargoes from Plaquemines. The bottom and top end of the EBITDA range was adjusted to account for arbitration reserves, three cargoes removed from the high end of the range, the anticipation that two DES cargoes exported in 2025 will deliver in 2026, and a lower fixed liquefaction fee of $4.50-$5.50 per MMBTU for cargoes remaining to be sold over 2025, consistent with current TTF and JKM forward price expectations.

On average, if fixed liquefaction fees over the remainder of 2025 increase or decrease by $1 per MMBTU, we expect our consolidated adjusted EBITDA range to adjust accordingly by $50 million-$60 million, reduced from the $230 million-$240 million range provided in our previous guidance. This reduced sensitivity to market prices reflects the contracting we executed during the third quarter and thus far in the fourth quarter. I will now turn the call back over to Mike. Thank you, Jack. At this point, we'd like to open up our call for Q&A. Thank you. Ladies and gentlemen, we will now begin the question and answer session. Should you have a question, please press the star followed by the one on your touchstone phone. You will hear a prompt that your hand has been raised.

If you wish to decline from the polling process, please press star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. The first question comes from John McKay at Goldman Sachs. Please go ahead. Hey, team. Thank you for the time. I do want to start on the arbitration. I appreciate the color from both of you, Mike and Jack, on the kind of funding levers here. Maybe could you walk us through in just a little more detail about how you'd think about funding a kind of worst-case scenario on these? On a related note, you lined up the $14-$15 million a quarter for 20 years. That gets to a number that's below the kind of total you guys talked about.

Maybe just walk us through some of the math on getting to that one as well. Thank you. Sure. Good morning, John. Thanks. I'll take the first half of that, and Jack will probably take the second half. We're in a very strong current cash position. The remaining arbitrations, if we were to settle or they were to run its full course, I should say, if they run their full course, will take place over the next year or two or more. They are spread over a considerable amount of time. We remain confident that we're going to do well on those. Just to answer your question, if they did not all go well, the incurrence of potential damages there would be spread out over a number of years.

In addition to current cash and the earnings that we'll achieve over the next couple of years, plus the large amount of unencumbered assets that we have, we have plenty of liquidity and time to smoothly manage exposure to any future potential damages there. We're over, with this quarter, over $50 billion in assets. We own 100% of Venture Global. We own 100% of CP2. We own our ships for cash, and we own approximately 77% of CP1. We're in a very strong ownership position of extremely valuable liquid assets. Jack, did you want to address the second question? Sure. John, I think the important descriptor of how we're addressing for accounting purposes the arbitrations is the term best estimate of award outcomes.

As we worked with our accounting firm to analyze the remaining arbitrations, the outcome in the BP arbitration, and align on what was our best estimate of the potential exposure associated with those, that's what allowed us to arrive at an estimate of the $14-$15 million per quarter impact. As you noted, that is an amount below the maximum liability that we have articulated. Even that's come down rather dramatically given the Shell and the other settlement awards or outcomes. We believe this captures the accounting guidance on how to address these potential outcomes, but by no means is it a cash charge at this point.

We need to fully arbitrate out the BP process, and we need to let the other four processes go forward and result in outcomes or in any potential settlements that we might achieve similar to the one that we achieved with one counterparty already. All right. Thanks, guys. Appreciate the color. Maybe just turning to the contracts you signed recently, maybe just give us an update. We've seen a lot of contracting activity across the U.S. projects so far this year. Do you think that activity continues, and where have kind of rates come in, pricing on those come in relative to your expectations? Maybe last piece of that, has the BP ruling at all kind of changed the tone of those contracting discussions? Thanks. No, not at all.

It's the best measure of the market's trust in us to execute today and over coming decades is the pace at which we're signing 20-year contracts. I think since the beginning of July, where we've signed over 5.25 MTPA, we've signed the most in the world of any project. I think that's the best market data point on the trust that the market has for our execution. We indicated in earlier calls earlier in the year that we've re-entered the market after deliberately staying on the sidelines to watch market pricing. We've re-entered the market really coming after Liberation Day tariff announcement and activities from the United States and have been extremely successful in executing the 20-year contracts that we wanted to.

The market remains very active for us, and we still have a very active queue of live deals, as we've talked about recently as well. We expect that to continue for us. Pricing is in line with where we started this, which we believe is the most attractive long-term price in the world. As we described earlier in this call, we still achieve probably the best returns in the market, in our market on those. We are able to offer a great price for the market that the market's responding to, drive great returns for shareholders, and offer great pricing in the market globally to help keep prices low to support future growth everywhere in the world. Appreciate the time. Thank you. Yep. Thank you. Thank you. The next question comes from Jeremy Tonet at JP Morgan. Please go ahead. Good morning, Jeremy. Hey. Hey.

Good morning. This is actually Roth and Reddy on for Jeremy. I just want to follow up a little bit on the arbitration. If you guys could talk a little bit about the confidence in that $765 million cap and maybe where that differed with the BP case versus the outstanding ones. The $765 million cap is the aggregate of the remaining caps for the four remaining arbitrations. We obviously agree with the result from the Shell arbitration panel that closely followed the results of the contract and resulted in there being no awards. That is the result that we expect for the rest of them. We obviously were surprised and strongly disagree with the result of the BP panel. If we were to lose all the rest of them up to the cap, that aggregates down to $765 million.

In any case, as we've talked about, we're able to manage either case of outcomes, and it doesn't impact our growth and our ability to finance efficiently the construction of our facilities on the pace we've been describing to generate the future earnings from a larger number of installed trains. With very conservative forward pricing assumptions in a few years, when you guys model it out, you'll see where we pass in not too long double-digit billion-dollar EBITDA numbers. We have a large ramp-up and growth in earnings coming in a few years. As you see the phases of CP2 come online, we're building a 20 million-ton CP2 phase one right now.

With the additional brownfields and bolt-ons coming for CP2 and Plaquemines, we have tremendous growth in earnings coming in the next few years that result just from completion of what we have already in construction or the brownfields that give us plenty of capital firepower, cash firepower, and earnings coming to manage through this. Got it. That's very helpful. Thank you. I think the prepared remarks hit on not needing many more 20-year SPAs to reach FID on CP2 phase two and the bolt-on as well. Just curious if you could talk about your strategy with regards to the tenor and contracts moving forward from here. It's similar to what we've been talking about for the last year, which is we're going to contract 20-year SPAs sufficient to give us the coverage ratios, the investment-grade coverage ratios on the debt of the projects.

The additional volume above that, which is substantial, is essentially, in air quotes, free extra capacity above the long-term contracts required to fully service and amortize the debt and cover operating expenses and return. That extra margin of production gives us a really, really attractive upside optionality on returns that we just described. Those non-20-year deals, we expect and plan on contracting over time on an intermediate and shorter-term basis to have a blended portfolio. As we just reported, we have 45 MTPA of long-term contracts. If you take what we are building today at CP2 plus the second phase, which, as we said, we are over $1 billion invested in already, that is a total of 67 MTPA. Of that 67, we are 45 contracted on a long-term basis. We will do more 20 years.

You see through the second phase of CP2, we'll be easily majority because we already are today 20-year contracted. Great. Thank you so much. Thank you. The next question comes from Manav Gupta at UBS. Please go ahead. Good morning, Manav. Good morning. Good morning and congrats on a good result and the new SPAs. I also wanted to talk to you about the situation in Ukraine. There was a news on Reuters. I'm not sure if it was true, but apparently you met President Zelensky with President Trump. I'm trying to understand what can Venture Global do to help the situation in Ukraine, which is massively short gas at this point of time. As we provided the statistic in our comments just a few minutes ago, Plaquemines represented incrementally new volume for the year of over 82%.

Plaquemines and Venture Global had a material impact on the global price and certainly European price of LNG, which we're super proud of the team for. We think about every day, including the people in Ukraine and Eastern Europe. That's the most important part. As we also indicated previously, we invested extra a few billion dollars into Plaquemines to keep the schedule, without which we probably would be a couple of years further behind the schedule we are today. Those investments that we made that a lot of came from Bob and I indirectly through our ownership were critical to maintaining the pricing that we're seeing today in Europe, which is certainly moderate compared to where it's been in the last few years.

Because we're able to produce so much extra production capacity at Plaquemines and we expect to see it at CP2 as well, it gives us extra availability for LNG volumes in coming months and quarters and in the next couple of years that is unique in the whole market. I think we probably have the most available capacity in the world that will allow us to support flows into the market either directly into storage or through intermediaries or both that we're working on to support. You certainly saw the agreement with Greece that the U.S. government was very supportive of for us to bring up extra supply to the southern part of that vertical corridor of pipeline supporting Eastern European countries there. Thank you, sir.

One thing which Venture Global sometimes, I believe, doesn't get enough credit for is the massive data science operations that you have set up. When you were at the platform trip, you explained some of those. Help us understand what differentiates your data science teams and the investment that your company has made in these data science operations. No, we're very proud of it. Sometimes we don't get credit for it because we're not giving all our secret sauce out there. If you keep it among us, Manav, I'll say that we've always viewed our facilities not as factories, but as complex machines that to us always create opportunity for acquisition of data and analysis of that data. I think for Calcasieu Pass, we're streaming now around 222,000 data points every 10 seconds. It's a massive amount of data.

Plaquemines will exceed that volume of data throughput. We have a dedicated team of data scientists and process engineers and AI programmers that have been incorporating that data into our current operations, but also into design changes as we've learned some very surprising interactions of different parts of the facility that are unanticipated that have contributed to our ability to achieve the remarkable performance results at Plaquemines and that we expect will carry over into CP2. It has been an incredible effort for us, and we've been hugely rewarded in the volume of production that we've achieved and maintained. Thank you so much. Just to add to that, we think that that will allow us to push CP2 up to 30 MTPA.

We'll have to go back and get the export authorization moved from 28 up to 30, but we think CP2 will be doing even better than Plaquemines, which is doing the best that any project's ever done. Thank you. Thank you. The next question comes from Jean Anne Salisbury at Bank of America. Please go ahead. Good morning, Jean. Good morning. I wanted to talk about, oh, no problem. I wanted to talk about the CP1 volumes. As you mentioned in your prepared remarks, they have bounced around a bit the last couple of quarters, it sounds like, due to the power maintenance. Can you discuss the power maintenance, I guess, and then the path to get to the sustained 12.4 MTPA? And as my follow-up, are these power maintenance issues kind of unique to CP1, or would you expect to see that maintenance eventually affecting Plaquemines as well?

Thank you. The maintenance at CP1 took a little bit longer than we expected, as I described. No, I do not think it is something that will carry on for Plaquemines. Obviously, you are always going to have routine maintenance at all your facilities, including in the power plants. It resulted in the one cargo. We have been this year conservative in our guidance for Calcasieu Pass as we continue to finish up things that will get us to the higher volumes. We have a pretty good—we have a pretty specific view on what we are going to do to get those volumes up. We are just deciding when we are going to implement that relative to the return we get for deploying that much capital into a CP2, for example, to increase output there. We look at it on a holistic basis.

We'll get it up to that number, and eventually, you'll see expansions, bolt-on expansions at CP1 as well. Okay. Thanks, Mike. Yep. Thanks. Thank you. The next question comes from Chris Robertson at Deutsche Bank. Please go ahead. Morning, Chris. Morning, Mike. Thanks for taking my questions. I just wanted to follow up on the previous questions. When you guys talk about getting to that 24% above nameplate over the next few years, do you think that takes place kind of steadily over time, or do you see that taking place as step changes in any particular year and what the implications might be for any O&M expenses related to that process? It'll be a combination of step change and steady increase. We're not being more specific on it just because we don't want to give away intellectual property.

We obviously, because of how we're operating the facility at Plaquemines, that's so much higher at the 140% level, we have a good view of what produces more. We have a good path to how we're going to get there. We'll update people and update the market when we want to disclose what the timing of it is going to be. I just broke some news on our confidence level at CP2 of getting that to 30. As I just said to Jean Anne, we look at it across all our facilities about where we're going to make the investments to add the extra volume. Got it. Okay. From an operational expense side, adding those extra trains does not materially impact the operating expense at all. We view that as almost entirely upside margin. Okay. Thanks, Mike.

Just related to your point just now around thinking about it holistically across the varied facilities here, when you guys think about contracting, traditionally in the past, things have been tied to a specific phase or a specific project. Are you now considering structuring agreements where it's a flexible cargo across any of the facilities that are producing, not necessarily just tied to one, but just tied to the greater portfolio? Yeah. I mean, we are. With the bolt-ons for CP2 and Plaquemines, we're heading towards in a few years passing 100 million tons of annual production. We will have one of the largest annual portfolios in the world of produced LNG. It gives us immense flexibility.

Particularly as you think about the combination of the extra margin of production across Plaquemines and CP2, which you will see kind of comparably also in the bolt-ons, we think. We have a big portfolio of—and I am doing air quotes—of extra LNG production because we will have contracted on a long-term basis what we need to cover all the construction debt and the returns. That gives us flexibility to provide more portfolio sale-type structures with fixed delivery dates that allow us to assign production to particular phases that will be difficult for a lot of other people in the market to match. When you add that on top of the cost and price advantage, that flexibility allows us to offer super attractive commodity prices for these contracts years sooner than almost everybody else in the market. It is showing up, right?

I mean, it's the contracting market. The SPA market is a voting machine, right? And so in the last few months, Venture Global has gotten the most votes in the market from terms of customer trust and confidence with these counterparties making multi-decade commitments to us and us to them. Right. Yeah. I appreciate the color on that. I'll turn it over. Thank you, Mike. Thank you. The last question comes from Bob Brackett at Bernstein Research. Please go ahead. Morning, Bob. I'm reporting a bit of an angle on arbitration. If we go back to Calcasieu Pass, first cargo was March 2022. Nine months later, someone announces—in December of 2022, someone announces arbitration. Now, here we are with Plaquemines. First cargo, very end of December of 2024. You've ramped all through this year. How is your relationship with the current set of counterparties?

Are they all on board with this sort of pre-COD, post-COD world that you guys live in? We have a great relationship with the customers, we believe. As it relates to Calcasieu Pass, we have performed successfully all of those loadings since we took COD for Calcasieu Pass. We are still—I have just reconfirmed it, and we just provided those comments again—reconfirmed to all the customers at Plaquemines that we are still on the original schedule for the first window period for Plaquemines, which is month 54. For a giant project like Plaquemines, 54 months is a remarkable achievement. We are still operating under around 400 megawatts of temporary power today. That is going to continue, like I described, probably until the first quarter. We do not have substantial completion under the EPC contract until late in the summer.

Including a lender liability test, reliability test, we have a lot to get done, but feel really good about achieving the original schedule with our customers for Plaquemines. That, in combination with the many billions of dollars that we've already put in extra into the Plaquemines project in order to maintain the current record-setting schedule, we think we're in a very solid position for Plaquemines. Very clear. Thanks for that. Yep. Thanks, Bob. Thank you. At this time, I'll turn the call back over to Mike Sabel for closing comments. Great. Thank you, everybody. We appreciate everybody's time this morning. Thank you for all the questions. In coming days, we look forward to answering more questions for people and look forward to being together here in a few months to report on how we ended up for the fourth quarter and look forward to 2026.

Thanks, everybody. Bye. Ladies and gentlemen, this concludes your conference call for today. We thank you for participating, and we ask that you please disconnect your lines.

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