Valero's Q2 2025: Contradictions in Market Dynamics, Throughput, and Capital Returns

Strong Financial Performance:
- Valero Energy reported net income attributable to Valero stockholders of $714 million or $2.28 per share for Q2 2025, compared to $880 million or $2.71 per share in the same period last year.
- The decline was partly due to lower refining margins and increased operating expenses in the Renewable Diesel segment.

Refining Segment Performance:
- The Refining segment reported operating income of $1.3 billion for Q2 2025, slightly down from $1.2 billion in Q2 2024.
- Despite this, refining throughput volumes averaged 2.9 million barrels per day, reaching 92% throughput capacity utilization.

Renewable Diesel Challenges:
- The Renewable Diesel segment reported an operating loss of $79 million for Q2 2025, compared to operating income of $112 million in Q2 2024.
- This was due to unfavorable economics and policy uncertainties, affecting renewable diesel production and sales volumes.

Capital Allocation and Shareholder Returns:
- Valero returned $695 million to stockholders in Q2 2025, including $354 million in dividends and $341 million for share buybacks.
- The company maintained a payout ratio of 52%, reflective of its commitment to shareholder returns.