Murphy USA Q2 earnings top as fuel margins improve, sales miss

Key takeaways

• MUSA posted Q2 EPS of $7.36, beating estimates and last year's $6.92 on stronger fuel margins.

• Q2 revenues fell 8.2% to $5B, missing estimates due to weak petroleum product sales.

• Merchandise sales rose 1 . 1% year over year, though SSS contribution fell 0.9%.

Motor fuel retailer Murphy USA Inc. (MUSA - Free Report) announced second-quarter 2025 earnings per share of $7.36, which beat the Zacks Consensus Estimate of $6.82 and compared favorably with the year-ago profit of $6.92. The outperformance was primarily on the back of higher fuel margins.

Murphy USA’s operating revenues of $5 billion fell 8.2% year over year and missed the consensus mark by $468 million due to lower-than-expected petroleum product sales.

Revenues from petroleum product sales came in at $3.9 billion, well below our estimate of $4.2 billion and down 11.3% from the second quarter of 2024. On the other hand, merchandise sales, at $1.1 billion, were up 1.1% year over year.

Murphy USA Inc. price, consensus and EPS surprise

Key takeaways

MUSA’s total fuel contribution edged up 0.7% year over year to $393 million on higher retail contribution and margin expansion. Total fuel contribution (including retail fuel margin plus product supply and wholesale results) came in at 32 cents per gallon, up 1% from the second quarter of 2024.

Retail fuel contribution fell 1.7% year over year to $359.1 million as margins narrowed to 29.2 cents per gallon from 29.7 cents in the corresponding period of 2024. Retail gallons declined 0.2% from the year-ago period to 1,229.3 million but beat our estimate of 1,227.2 million. Volumes on an SSS basis (or fuel gallons per store) deteriorated 2.1% from the second quarter of 2024 to 239.3 thousand.

Contribution from Merchandise edged up 1% to $218.7 million on slightly higher sales even as unit margins remained flat year over year at 20%. On an SSS basis, total merchandise contribution decreased 0.9% year over year, primarily due to 2.4% lower non-nicotine margins. Meanwhile, merchandise sales decreased 1% on an SSS basis, due to a drop in nicotine as well as non-nicotine sales.

The Zacks Rank #4 (Sell) company’s monthly fuel gallons fell 2.3% from the prior-year period, while merchandise sales decreased 0.7% on an average per-store monthly basis. 

Balance sheet

As of June 30, Murphy USA — which opened six new retail locations in the quarter and closed one outlet to take its store count to 1,766 — had cash and cash equivalents of $54.1 million and long-term debt (including lease obligations) of $2.1 billion, with a debt-to-capitalization of 76.2%.

During the quarter, MUSA bought back shares worth $211.9 million.

Some key refining earnings

While we have discussed MUSA’s second-quarter results in detail, let’s see how some other refining companies have fared this earnings season.

Valero Energy (VLO - Free Report) reported second-quarter 2025 adjusted earnings of $2.28 per share, which beat the Zacks Consensus Estimate of $1.73. However, the bottom line declined from the year-ago quarter’s level of $2.71. Valero’s total quarterly revenues decreased from $34.5 billion in the prior-year quarter to $29.9 billion. The top line, however, beat the Zacks Consensus Estimate of $27.8 billion.

The better-than-expected quarterly results can be attributed to an increase in Valero’s refining margins per barrel of throughput and lower total cost of sales. The positives were partially offset by a decline in refining throughput volumes and renewable diesel sales volumes.

Another refining giant, Phillips 66 (PSX - Free Report) , reported adjusted earnings of $2.38 per share, topping the Zacks Consensus Estimate of $1.66. The bottom line also improved from the year-ago quarter’s level of $2.31. Phillips 66’s outperformance can be attributed to increased refining volumes and higher realized refining margins worldwide.

Phillips 66 generated $845 million of net cash from operations in the reported quarter, a significant decline from $2,097 million in the year-ago period. The company’s capital expenditure and investments totaled $587 million. Phillips 66 paid out dividends of $487 million in the second quarter. As of June 30, 2025, cash and cash equivalents were $1.1 billion. Total debt was $20.9 billion, reflecting a debt-to-capitalization of 42%.

Finally, we have PBF Energy’s (PBF - Free Report) second-quarter adjusted loss per share of $1.03, narrower than the Zacks Consensus Estimate of a loss of $1.19. This primarily reflects lower costs and expenses. PBF Energy reported an operating loss of $400.4 million in the Refining segment against an operating income of $107.7 million a year ago.

PBF Energy spent $144.5 million in capital on refining operations and $8.2 million on logistics businesses. At the end of the second quarter, it had cash and cash equivalents of $591 million. As of June 30, PBF had a total debt of $2.4 billion, resulting in a total debt-to-capitalization of 30.2%.

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