EQT Corporation (EQT) | The Buildout — AI Infrastructure
The Verdict
EQT Corporation is a vertically integrated natural gas company operating across the Appalachian Basin. It extracts natural gas, natural gas liquids and oil, and owns gathering and transmission pipelines that move that gas to markets. The AI buildout depends on EQT through the power layer: data centers pull electricity, that pull drives gas-fired power plants, and those plants need long-term gas supply and pipeline capacity. EQT's role is to sign those supply and midstream contracts rather than to own compute or data centers.
| Market Cap | — |
| Revenue (TTM) | $9.3B |
| Revenue Growth | +16.0% |
| EBITDA Margin (TTM) | 72.3% |
| Net Debt | $5.5B |
| Earnings Beats | 7 of 7 |
| P/E (TTM) | — |
| EV/EBITDA (TTM) | — |
What We Like
- Management says EQT has about 12.5 Bcf/day of productive capacity across roughly 2 million acres, against Q2 2026 production of 634 Bcfe.
- Balance sheet: Q2 2026 exited with $5.5 billion net debt and $5.7 billion total debt; Q1 leverage was below 1x net debt/EBITDA and Fitch upgraded EQT to BBB.
- Compression program is 6 projects in 2026, with about 30 more identified and a ~0.5 Bcf/d per year deployment cadence through roughly 2029.
- Commercial wins include the CPV 325 MMcf/d 10-year power-linked contract, Duke/Southern 2.6 Bcf/d of supply deals, and a 0.5 MTPA 2028 LNG offtake.
- MVP Southgate has FERC authorization; $85 million of equity-method contributions pulled from 2027 into 2026 to accelerate construction.
What We’re Watching
- Management said EQT is looking at multiple Bcf a day of supply opportunities that could start landing in the second half of 2026; signed agreements would test the commercial claims.
- MVP Southgate construction should be available by end of 2026, but commercial arrangements are still being aligned.
- Management says compression type-curve models have been 'blown away' and is recalibrating; persistence through 2029 remains to be seen.
- The near-20 Bcf/d demand stack is unrisked; EQT's own probability-weighted view is high-single-digit Bcf/d, and most large infrastructure takes 3–5 years.
The thesis has strengthened on EQT-controlled execution: the balance sheet is repaired, operational performance is beating, and the company is converting Appalachian demand into signed supply, midstream, and LNG contracts. The open question is whether the external power, data-center, and pipeline demand wave arrives on the timing and scale management describes.
Earnings Beat
EQT reported Q2 2026 revenue of $1.81 billion, gross margin of 73.2%, and EBITDA of $1.14 billion. Sales volume was 634 Bcfe, above the high end of guidance, while total per-unit operating costs came in at $1.03 per Mcfe at the low end.
| Metric | Q2 FY2026 | Q1 FY2026 | Q2 FY2025 | YoY |
|---|---|---|---|---|
| Revenue | $1.8B | $3.4B | $2.6B | −29.2% |
| Gross margin | 73.2% | 98.4% | 54.7% | +1850bps |
| EBITDA | $1.1B | $2.7B | $1.8B | −34.9% |
| EPS | $0.45 | $2.49 | $1.30 | −65.4% |
| Sales volume | 634 Bcfe | 617.7 Bcfe | n/a | — |
we seem to be… winning almost 100% of these deals that we are on— Toby Rice, CEO, July 22, 2026
Management tone: Management's tone shifted from balance-sheet defense to offensive commercialization. On the Q2 2026 call, executives said EQT was winning almost 100% of the deals it pursued and argued the market was still not giving credit for contracted cash-flow accumulation, while also acknowledging near-term risks from Permian supply and super El Niño weather.
Management Guidance
On the Q2 2026 call, management raised full-year 2026 production guidance by roughly 90 Bcfe at the midpoint, lowered full-year 2026 capex by $25 million, and moved $85 million of capital contributions to equity method investments from 2027 into 2026 to accelerate MVP Southgate. The original 2026 production guidance was 2.275–2.375 Tcfe; management also reiterated its intent to grow the base dividend annually.
Trajectory
Revenue is commodity-price-sensitive and decelerating on a quarterly basis: after Q1 2026 revenue of $3.38 billion, Q2 2026 revenue fell 46.4% sequentially to $1.81 billion; Q1 NYMEX natural gas was $4.95 per MMBtu and Q2 natural gas prices averaged $2.89 per MMBtu. Reported gross margin came in at 73.2% in Q2, down from 98.4% in Q1, while EBITDA margin compressed from 79.6% to 63.2%. Operationally, the quarter beat internal guidance on production, capex, and per-unit operating costs.
The Model
The model projects FY+1 revenue of $10,700 million and EBITDA of $7,918 million, a 74.0% EBITDA margin. For FY+2 it projects revenue of $11,870 million and EBITDA of $9,045 million, a 76.2% EBITDA margin. The near-term path is anchored by the raised 2026 production guide and the contracted supply stack; FY+2 assumes continued demand-driven volume growth and improving midstream cash flow.
| Metric | FY2025 | Next FY (E) | Following FY (E) |
|---|---|---|---|
| Revenue | $9.1B | $10.7B | $11.9B |
| YoY Growth | — | +17.9% | +10.9% |
| EBITDA | $5.7B | $7.9B | $9.0B |
| EBITDA Margin | 63.4% | 74.0% | 76.2% |
Projections are the median of 5 independent model runs. The model’s revenue sits 25.0% above analyst consensus.
On the Q2 2026 call, management raised full-year 2026 production guidance by roughly 90 Bcfe at the midpoint, lowered full-year 2026 capex by $25 million, and moved $85 million of capital contributions to equity method investments from 2027 into 2026 to accelerate MVP Southgate. The original 2026 production guidance was 2.275–2.375 Tcfe; management also reiterated its intent to grow the base dividend annually.
What Could Go Right — and Wrong
- The 'multiple Bcf a day' supply opportunities management described begin landing in the second half of 2026, confirming the commercial pipeline.
- MVP Southgate commercial terms are paired with the end-2026 construction schedule, pulling midstream cash flow into 2027.
- Compression-driven base-decline improvement extends through 2029, lowering operating costs and supporting EBITDA margins.
- The 2028 LNG offtake delivers on time, adding roughly $45 million of projected 2028 free cash flow.
- The 2030 LNG portfolio is signed at strong spreads, improving revenue and EBITDA later in the decade.
- Appalachia demand projects slip as developers delay FIDs or PJM reforms stall; the risked high-single-digit Bcf/d view could prove optimistic.
- Gas prices remain weak, as in Q2 when $2.89 per MMBtu gas cut revenue 46.4% sequentially.
- Power-linked contracts such as CPV have no disclosed floor; weaker PJM power prices would reduce the expected uplift.
- Compression benefits plateau after management's model recalibration, reducing the margin tailwind.
- LNG project slippage delays the January 2028 offtake or the post-2030 portfolio.
Looking Ahead
The next twelve months are framed by management's expected deal flow and construction progress. Management said it is looking at multiple Bcf a day of supply opportunities that could start landing in the second half of 2026. Clarington Connector is under construction in 2026 and likely online 2027/2028, and MVP Southgate construction should be available by the end of 2026. Q3 and Q4 results test the raised production guidance and lower capex plan, while the January 2028 LNG start and the late-2027 Southeast utility deliveries sit just beyond the near-term window.
- Q3/Q4 2026Production and capex delivery — Tests raised production guidance and lower capex plan.
- End of 2026MVP Southgate commercial alignment — Commercial terms paired with accelerated construction schedule.
- 2H 2026Supply opportunities begin landing — Management said multiple Bcf a day of supply opportunities could start landing in the second half of 2026.
- 2026–2027Clarington / Ohio egress buildout — Clarington Connector is under construction in 2026 and likely online 2027/2028.
- January 2028LNG offtake start — Two Gulf Coast facilities commission; possible slippage.
- Late 2027–2028Southeast utility deliveries begin — Contracted cash-flow uplift of about $300 million per year begins.
Financials
Annual Summary
| Metric | FY2024 | FY2025 | TTM | YoY |
|---|---|---|---|---|
| Revenue | $5.2B | $9.1B | $9.3B | +73.7% |
| Gross Margin | 19.7% | 48.0% | 68.4% | +2,825bps |
| EBITDA | $2.8B | $5.7B | $23.0B | +101.9% |
| EBITDA Margin | 54.5% | 63.4% | 72.3% | +883bps |
| Net Income | $231M | $2.0B | $2.8B | +784.3% |
| Free Cash Flow | $573M | $2.8B | $7.8B | — |
| Net Cash | — | — | — | — |
Key Ratios (Trailing)
- P/E TTM—
- EV/EBITDA TTM—
- EV/Revenue TTM—
- Price/FCF TTM—
- Gross Margin (TTM)68.4%
- EBITDA Margin (TTM)72.3%
- Net Margin (TTM)30.7%
- ROIC10.3%
- FCF Conversion56.1%
- SBC / Revenue0.6%
The Company
EQT Corporation is a vertically integrated natural gas company focused on the Appalachian Basin. Its upstream segment sells natural gas, NGLs and oil; its gathering and transmission segments earn pipeline revenue. In Q1 2026, upstream operating revenue was $3.21 billion, gathering $335.0 million, and transmission $161.5 million. Management says the company holds about 12.5 Bcf/day of productive capacity across roughly 2 million acres, with Q2 2026 production at 634 Bcfe.
EQT owns an Appalachian processing facility with 0.2 Bcf/day of capacity and contracts with MarkWest Energy Partners, Williams Ohio Valley Midstream and Blue Racer Midstream to process heavier hydrocarbon streams. The company describes itself as vertically integrated, with an integrated water infrastructure network and a strategic leasing program that has added about 100,000 net acres since 2020.
Business Segments
Competitive Landscape
The 10-K describes EQT's competitors broadly as independent oil and gas companies, major oil and gas companies, individual producers, operators, marketing companies and other energy companies producing substitutes. Management separately says EQT is the clear partner of choice throughout the Appalachian region and describes EQT as uniquely positioned to capture a substantial amount of Appalachia demand growth and continue to improve realized pricing.
Supply Chain
EQT sits upstream of gas-fired power and data-center demand, supplying natural gas, LNG and propane logistics while operating its own midstream. The 10-K discloses third-party processing relationships with MarkWest Energy Partners, Williams Ohio Valley Midstream and Blue Racer Midstream.
More on EQT: Earnings recap