Phillips 66 (PSX) Expected to Beat Earnings Estimates: What to Know Ahead of Q2 Release

Phillips 66 (PSX) is anticipated to report Q2 2025 earnings of $1.63 per share and $30.54 billion in revenue, marking year-over-year declines of 29.4% and 21.5% respectively. Despite these consensus forecasts, the company holds a positive Zacks Earnings ESP of +4.25% combined with a Zacks Rank of #3, indicating a high probability of exceeding consensus EPS estimates when it reports on July 25th. This potential earnings beat, supported by a history of outperforming estimates in three of the past four quarters, suggests possible near-term positive stock price action.

Analysis

Phillips 66 (PSX) is positioned for a potential earnings beat in its upcoming Q2 2025 report, despite a challenging macroeconomic backdrop reflected in consensus estimates. Projections point to a significant year-over-year contraction, with expected earnings per share of $1.63 (-29.4% YoY) and revenues of $30.54 billion (-21.5% YoY). However, quantitative indicators suggest a high probability of outperforming these lowered expectations. The company's Zacks Earnings ESP is a positive 4.25%, which, when combined with its Zacks Rank #3 (Hold), historically indicates a nearly 70% chance of a positive EPS surprise. This outlook is further supported by a recent 0.82% upward revision in the consensus EPS estimate over the last 30 days, signaling renewed analyst optimism. While PSX has a track record of beating estimates in three of the last four quarters, a miss in the most recent quarter serves as a point of caution. The broader industry context, with peer Valero Energy (VLO) also showing a similar pattern of expected YoY declines but a positive ESP, suggests this may be a sector-wide trend of beating subdued forecasts rather than a signal of fundamental business acceleration.

Key Decisions for Investors

• Given the strong +4.25% Earnings ESP and Zacks Rank #3, traders might consider positioning for a potential short-term price increase following the earnings release, as an EPS beat is highly probable.
• Long-term investors should look beyond a potential earnings beat and scrutinize management's forward-looking guidance on the earnings call, as the significant year-over-year declines in revenue and profit point to underlying business headwinds.
• Monitor the results of peer Valero Energy, which has a similar quantitative profile, as its performance could serve as a bellwether for the refining sector's ability to outperform lowered market expectations.
• Despite the likelihood of an earnings beat, investors should weigh this against the company's recent history, which includes a notable earnings miss of -16.88% in the last reported quarter.