PLAINS ALL AMERICAN PIPELINE LPPAA
PLAINS ALL AMERICAN PIPELINE LP Earnings Per Share Disclosure
Net Income Per Common Unit
After consideration of distributions to preferred unitholders, basic and diluted net income per common unit is determined pursuant to the two-class method as prescribed in FASB guidance. This method is an earnings allocation formula that is used to determine allocations to our limited partners and participating securities according to distributions pertaining to the current period’s net income and participation rights in undistributed earnings or distributions in excess of earnings. Under the two-class method, income from continuing operations is reduced by distributions pertaining to the period, and all remaining earnings or distributions in excess of earnings are then allocated to our common unitholders and participating securities based on their respective rights to share in distributions, regardless of whether those earnings would actually be distributed during a particular period from an economic or practical perspective. Participating securities include equity-indexed compensation plan awards that have vested DERs, which entitle the grantee to a cash payment equal to the cash distribution paid on our outstanding common units.
We calculate basic and diluted net income per common unit by dividing income from continuing operations attributable to PAA (after deducting amounts allocated to the preferred unitholders and participating securities) and income from discontinued operations by the basic and diluted weighted average number of common units outstanding during the period.
The diluted weighted average number of common units is computed based on the weighted average number of common units plus the effect of potentially dilutive securities outstanding during the period, which include (i) our Series A preferred units and (ii) our equity-indexed compensation plan awards. See Note 12 for additional information regarding our Series A preferred units. See Note 18 for a complete discussion of our equity-indexed compensation plan awards. When applying the if-converted method prescribed by FASB guidance, the possible conversion of approximately 59 million, 71 million and 71 million Series A preferred units, on a weighted-average basis, were excluded from the calculation of diluted net income per common unit for the years ended December 31, 2025, 2024 and 2023, respectively, as the effect was antidilutive for all periods. Our equity-indexed compensation plan awards that contemplate the issuance of common units are considered potentially dilutive unless (i) they become vested only upon the satisfaction of a performance condition and (ii) that performance condition has yet to be satisfied. Equity-indexed compensation plan awards that are deemed to be dilutive during the year are reduced by a hypothetical common unit repurchase based on the remaining unamortized fair value, as prescribed by the treasury stock method in guidance issued by the FASB.
The following table sets forth the computation of basic and diluted net income per common unit (in millions, except per unit data):
| Year Ended December 31, | |||||||||||||||||
| 2025 | 2024 | 2023 | |||||||||||||||
| Basic and Diluted Net Income per Common Unit | |||||||||||||||||
| Continuing Operations: | |||||||||||||||||
Income from continuing operations, net of tax | $ | 1,386 | $ | 882 | $ | 1,310 | |||||||||||
Net income attributable to noncontrolling interests | (334) | (341) | (272) | ||||||||||||||
| Net income from continuing operations attributable to PAA | 1,052 | 541 | 1,038 | ||||||||||||||
| Distributions to Series A preferred unitholders | (146) | (175) | (173) | ||||||||||||||
| Distributions to Series B preferred unitholders | (70) | (78) | (76) | ||||||||||||||
| Amounts allocated to participating securities | (11) | (10) | (10) | ||||||||||||||
Impact from repurchase of Series A preferred units (1) | (43) | — | — | ||||||||||||||
| Other | 4 | 5 | 5 | ||||||||||||||
Net income from continuing operations allocated to common unitholders - Basic and Diluted (2) | $ | 786 | $ | 283 | $ | 784 | |||||||||||
| Discontinued Operations: | |||||||||||||||||
Net income from discontinued operations allocated to common unitholders - Basic and Diluted (3) | $ | 383 | $ | 231 | $ | 192 | |||||||||||
| Net income allocated to common unitholders — Basic and Diluted | $ | 1,169 | $ | 514 | $ | 976 | |||||||||||
| Basic and diluted weighted average common units outstanding | 704 | 702 | 699 | ||||||||||||||
| Basic and diluted net income per common unit: | |||||||||||||||||
| Continuing operations | $ | 1.12 | $ | 0.40 | $ | 1.12 | |||||||||||
| Discontinued operations | 0.54 | 0.33 | 0.28 | ||||||||||||||
| Basic and diluted net income per common unit | $ | 1.66 | $ | 0.73 | $ | 1.40 | |||||||||||
(1)We repurchased approximately 12.7 million Series A preferred units on January 31, 2025. See Note 12 for additional discussion of this transaction. The difference between the cash we paid for the repurchase of such units and their carrying value on our balance sheet is considered a return to Series A preferred unitholders for the calculation of net income from continuing operations allocated to common unitholders.
(2)We calculate net income from continuing operations allocated to common unitholders based on the distributions pertaining to the current period’s net income. After adjusting for the appropriate period’s distributions, the remaining undistributed earnings or excess distributions over earnings (i.e., undistributed loss), if any, are allocated to the common unitholders and participating securities in accordance with the contractual terms of our partnership agreement in effect for the period and as further prescribed under the two-class method.
(3)Net income from discontinued operations allocated to common unitholders is Income from discontinued operations, net of tax as presented on our Consolidated Statements of Operations.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 27, 2026 | Showing above |
| 2024 | Feb 28, 2025 | |
| 2023 | Feb 29, 2024 | |
About Earnings Per Share Disclosures
The earnings per share disclosure breaks down the calculation from net income to both basic and diluted EPS, revealing the full impact of a company's capital structure on per-share economics. The reconciliation between basic and diluted share counts exposes how many stock options, RSUs, convertible securities, and warrants are potentially dilutive to existing shareholders.
Key signals: a widening gap between basic and diluted shares indicates growing dilution from equity compensation or convertible instruments. Anti-dilutive securities excluded from the diluted calculation deserve attention — they represent latent dilution that will materialize if the stock price rises. Watch for the effect of share buybacks on per-share metrics: EPS growth driven primarily by repurchases rather than income growth signals weakening fundamentals. Compare year-over-year changes in the diluted share count against equity compensation expense to assess whether management is effectively managing dilution.