Kinetik Holdings Inc.KNTK
Kinetik Holdings Inc. Revenue Disclosure
REVENUE RECOGNITION
The following table presents a disaggregation of the Company’s revenue:
| For the Year Ended December 31, | ||||||||||||||||||||
| 2025 | 2024 | 2023 | ||||||||||||||||||
| (In thousands) | ||||||||||||||||||||
| Gathering and processing services | $ | 445,496 | $ | 408,000 | $ | 417,751 | ||||||||||||||
| Natural gas, NGLs and condensate sales | 1,307,228 | 1,062,986 | 822,410 | |||||||||||||||||
| Other revenue | 11,665 | 11,943 | 16,251 | |||||||||||||||||
Total revenues | $ | 1,764,389 | $ | 1,482,929 | $ | 1,256,412 | ||||||||||||||
There have been no significant changes to the Company’s contracts with customers during the years ended December 31, 2025, 2024 and 2023 aside from the addition of certain gas gathering and processing agreements associated with the Durango Acquisition in 2024 and the Barilla Draw Acquisition in January 2025. Contracts with customers acquired through these acquisitions have similar structures as the Company’s existing contracts with customers. For the years ended December 31, 2025, 2024 and 2023 the Company recognized revenues from MVC deficiency payments of $2.0 million, $0.1 million and $1.6 million, respectively.
Remaining Performance Obligations
The following table presents our estimated revenue from contracts with customers for remaining performance obligations that has not yet been recognized, representing our contractually committed revenues as of December 31, 2025:
| Fiscal Year | Amount | ||||
| (In thousands) | |||||
| 2026 | $ | 52,563 | |||
| 2027 | 70,923 | ||||
| 2028 | 76,098 | ||||
| 2029 | 73,500 | ||||
| 2030 | 88,896 | ||||
| Thereafter | 87,532 | ||||
| $ | 449,512 | ||||
Our contractually committed revenue, for purposes of the tabular presentation above, is limited to customer contracts that have fixed pricing and fixed volume terms and conditions, generally including contracts with payment obligations associated with MVCs.
Contract Liabilities
The following provides information about contract liabilities from contracts with customers:
| (In thousands) | 2025 | 2024 | |||||||||
| Balance as of January 1 | $ | 26,665 | $ | 32,238 | |||||||
| Reclassification of beginning contract liabilities to revenue as a result of performance obligations being satisfied | (8,662) | (7,003) | |||||||||
| Cash received in advance and not recognized as revenue | 18,629 | 1,430 | |||||||||
| Balance as of December 31 | 36,632 | 26,665 | |||||||||
| Less: Current portion | 5,673 | 5,680 | |||||||||
| Non-current portion | $ | 30,959 | $ | 20,985 | |||||||
Contract liabilities relate to payments received in advance of satisfying performance obligations under a contract, which result from contribution in aid of construction payments. Current and noncurrent contract liabilities are included in “Other Current Liabilities” and “Contract Liabilities”, respectively, of the Consolidated Balance Sheets.
Contract liabilities balance as of December 31, 2025 increased $10.0 million compared to that as of December 31, 2024. Higher contract liabilities balance is primarily due to an increase in cash received in advance for new customer contracts during the year and slightly offset by an increase in reclassification of beginning contract liabilities to revenue as a result of performance obligations being satisfied.
Contract Cost Assets
The Company has capitalized certain costs incurred to obtain a contract or additional contract dedicated acreage or volumes that would not have been incurred if the contract or associated acreage and volumes had not been obtained. These costs are recovered through the net cash flows of the associated contract. As of December 31, 2025 and 2024, the Company had contract cost assets of $61.6 million and $64.6 million, respectively. Current and noncurrent contract cost assets are included in “Prepaid and Other Current Assets” and “Deferred Charges and Other Assets”, respectively, of the Consolidated Balance Sheets. The Company amortizes these assets as cost of sales on a straight-line basis over the life of the associated long-term
customer contract. For the years ended December 31, 2025, 2024 and 2023, the Company recognized cost of sales associated with these assets of $6.8 million, $6.6 million and $6.6 million, respectively.
Contract cost assets balance as of December 31, 2025, decreased $3.0 million compared to that as of December 31, 2024. The decrease was primarily related to the amortization of these assets during 2025, slightly offset by an increase in capitalized costs for new customer contracts.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2024 | Mar 3, 2025 | |
| 2023 | Mar 5, 2024 | |
| 2022 | Mar 7, 2023 | |
| 2021 | Feb 22, 2022 | |
| 2020 | Feb 26, 2021 | |
| 2019 | Mar 16, 2020 | |
About Revenue Disclosures
Revenue disclosures under ASC 606 explain how a company identifies performance obligations, allocates transaction prices, and determines when revenue is recognized. This section is essential for understanding whether reported revenue reflects genuine economic activity or aggressive accounting choices. Analysts examine the mix of point-in-time versus over-time recognition, which directly affects revenue timing and comparability.
Key signals: rising contract liabilities (deferred revenue) suggest strong future revenue visibility, while declining contract assets may indicate slowing project milestones. Watch for variable consideration estimates — rebates, returns, and performance bonuses that require management judgment. Significant changes in disaggregated revenue by geography or product line can reveal shifting business mix before it appears in headline numbers. Compare revenue growth against contract liability growth to assess sustainability, and scrutinize any changes in the timing of recognition that coincide with earnings pressure.