Kinder Morgan (KMI) delivered strong performance in the fourth quarter of 2025, reporting financial results that exceeded analyst expectations on the strength of surging natural gas demand.
The midstream company reported adjusted EBITDA of $2.271 billion, beating the consensus estimate of $2.214 billion. That represents a 10% increase compared to the fourth quarter of 2024. Record-setting performance in its natural gas pipelines business segment led to the company delivering its highest ever fourth quarter and full-year net income attributable to KMI and adjusted EBITDA.
Looking ahead to the full year, KMI revised its 2026 adjusted EBITDA budget to $8.6 billion, slightly lower than the previous $8.7 billion figure (read more) reflecting its divestiture of a non-core asset. The new number reflects year-over-year EBITDA growth of 2.5%.
The company provided updates on its project backlog, which saw significant expansion during the past quarter. It now sits at $10 billion. Kinder Morgan added $912 million in new projects during the quarter alone. It placed approximately $265 million of infrastructure into service.
This growth is almost entirely tied to the natural gas sector; such projects account for 90% of the total backlog. Furthermore, nearly 60% of these initiatives are specifically tailored to support power generation. This highlights the energy requirements of AI-driven data centers and regional population shifts as important growth drivers.
Natural Gas Infrastructure Expansion in the Southeast
Much of the recent momentum in the natural gas segment is concentrated in the Southeast, particularly through the Florida Gas Transmission (FGT) system. On January 16, the company initiated open seasons for two major natural gas infrastructure expansions supported by long-term binding agreements from anchor shippers.
The South Florida Project will involve a new 37-mile lateral and compression facilities to enhance redundancy. Meanwhile, the Phase IX Project will add 82 miles of pipeline looping and upgraded compressor station turbines to expand capacity across FGT’s market area. Together, these Florida-based natural gas projects are expected to result in capital expenditures of up to $700 million (KMI’s share).
Strengthening Credit Profile and Future Opportunities
Kinder Morgan expects to spend approximately $3.0 billion in growth capital for the next few years. The company expects to fund this growth entirely through internally generated cash flow.
The company’s focus on disciplined growth and stable natural gas cash flows recently earned it a credit rating upgrade from S&P Global Ratings. On January 13, S&P raised Kinder Morgan’s senior unsecured rating to BBB+ from BBB. That followed a similar move by Fitch last year. This improved credit profile supports the company’s balanced approach to capital allocation.
Looking ahead, Kinder Morgan remains bullish on the long-term outlook for natural gas in North America. Its shadow backlog of opportunities exceeds $10 billion, beyond the current sanctioned projects. Management noted that the company is in various stages of development to potentially serve more than 10 billion cubic feet per day of natural gas demand in the power generation sector.
Kinder Morgan is a top-10 holding in the Alerian Energy Infrastructure ETF (ENFR ), weighted 5.2% as of January 21. ENFR tracks the Alerian Midstream Energy Select Index (AMEI), a composite of North American energy infrastructure companies. Additionally, investors can access AMEI with the ALPS Alerian Energy Infrastructure Portfolio (ALEFX), which provides exposure in a VIT wrapper.
For more news, information, and analysis, visit the Energy Infrastructure Content Hub.
vettafi.com is owned by VettaFi LLC (“VettaFi”). VettaFi is the index provider for ENFR and ALEFX, for which it receives an index licensing fee. However, ENFR and ALEFX are not issued, sponsored, endorsed, or sold by VettaFi, and VettaFi has no obligation or liability in connection with the issuance, administration, marketing, or trading of ENFR and ALEFX.
