Williams' Q1 2025: Unpacking Contradictions in Cogentrix Investment, Data Center Strategies, and Project Returns

Cogentrix investment rationale, data center projects and behind-the-meter solutions, storage expansion and value, Transco Power Express and Mountain Valley Pipeline, and project returns and capital allocation are the key contradictions discussed in Williams' latest 2025Q1 earnings call.



Strong Base Business Performance:
- Williams Companies, Inc. reported an adjusted EBITDA of $7.7 billion for 2025, an increase of 9% from 2024, marking the highest growth since 2000.
- The growth was driven by strong results in the base business, particularly in the Transmission & Gulf segment, which achieved a 3% increase in EBITDA.

High-Return Projects and Investments:
- Williams announced a significant investment of $1.6 billion in the Socrates project, which is expected to generate earnings consistent with a 5x EBITDA bill multiple.
- This investment is part of a broader trend of high-return projects, including the Transco’s Power Express Pipeline and the acquisition of a 10% interest in Cogentrix Energy.

Transmission and Gathering Strength:
- The Transmission & Gulf segment saw record EBITDA, driven by increases in contract gas transmission capacity and gathering processing and storage fees.
- This was supported by completion of major expansion projects like the Southeast Energy Connector and the Texas to Louisiana Energy Pathway.

Leadership Transition and Strategic Direction:
- Alan Armstrong announced he will step down as President and CEO, with Chad Zamarin taking over, effective July 1, 2025.
- The transition is aimed at maintaining Williams' focus on stable, predictable growth in its core business, while exploring adjacent opportunities strategically.