Global Partners Q2 Profit Dips Amid Wholesale Margin Squeeze

TL;DR

**GLP-PB's Q2 was a mixed bag, but the wholesale segment's margin hit is a red flag for future profitability.**

AI Summary

GLOBAL PARTNERS LP reported total revenues of $4.1 billion for the three months ended June 30, 2025, a decrease from $4.7 billion in the prior-year period. Net income for the second quarter of 2025 was $55.3 million, down from $72.1 million in the second quarter of 2024. The Wholesale segment's product margin decreased by $15.2 million to $105.6 million for the three months ended June 30, 2025, primarily due to lower refined petroleum products and renewable fuels margins. The Gasoline Distribution and Station Operations segment saw its product margin increase by $10.1 million to $135.8 million, driven by higher gasoline and diesel fuel margins. The Commercial segment's product margin declined by $1.7 million to $14.1 million. The company completed a sale-leaseback transaction involving certain sites, resulting in a gain of $3.0 million during the six months ended June 30, 2025. Risks include commodity price volatility, which significantly impacted the cost of sales for commodity products, totaling $7.8 billion for the six months ended June 30, 2025. Strategic outlook involves optimizing its asset base through transactions like the sale-leaseback, while navigating a challenging commodity market.

Why It Matters

GLOBAL PARTNERS LP's mixed Q2 results, with declining net income and wholesale margins, signal potential headwinds for investors in the energy distribution sector. The increase in gasoline distribution margins suggests resilience in consumer-facing operations, but overall profitability is pressured by commodity price volatility. This performance could impact employee bonuses and future investment in infrastructure, while customers might see stable fuel prices due to competitive pressures. The broader market will watch how GLP-PB and its peers adapt to fluctuating energy prices and evolving renewable fuel mandates, influencing sector valuations.

Risk Assessment

Risk Level: medium — The risk level is medium due to significant exposure to commodity price volatility, as evidenced by the $7.8 billion cost of sales for commodity products for the six months ended June 30, 2025. While the company is managing its asset base through sale-leaseback transactions, the $15.2 million decrease in Wholesale segment product margin highlights ongoing market sensitivity.

Analyst Insight

Investors should monitor GLOBAL PARTNERS LP's ability to mitigate commodity price risks and diversify revenue streams. Consider holding existing positions but be cautious about new investments until there's clearer evidence of sustained margin improvement in the Wholesale segment.

Financial Highlights

revenue

$4.1B

net Income

$55.3M

Revenue Breakdown

Key Numbers

• $4.1B — Total Revenues (Decreased from $4.7B in Q2 2024 to $4.1B in Q2 2025)
• $55.3M — Net Income (Decreased from $72.1M in Q2 2024 to $55.3M in Q2 2025)
• $15.2M — Wholesale Segment Product Margin Decrease (Reduced to $105.6M in Q2 2025 due to lower refined petroleum product margins)
• $10.1M — Gasoline Distribution Product Margin Increase (Increased to $135.8M in Q2 2025 due to higher gasoline and diesel fuel margins)
• $7.8B — Cost of Sales for Commodity Products (Significant exposure to commodity price volatility for the six months ended June 30, 2025)
• $3.0M — Gain from Sale-Leaseback (Recognized during the six months ended June 30, 2025, from asset optimization)

Key Players & Entities

• GLOBAL PARTNERS LP (company) — filer of the 10-Q
• $4.1 billion (dollar_amount) — total revenues for Q2 2025
• $4.7 billion (dollar_amount) — total revenues for Q2 2024
• $55.3 million (dollar_amount) — net income for Q2 2025
• $72.1 million (dollar_amount) — net income for Q2 2024
• $15.2 million (dollar_amount) — decrease in Wholesale segment product margin
• $105.6 million (dollar_amount) — Wholesale segment product margin for Q2 2025
• $10.1 million (dollar_amount) — increase in Gasoline Distribution and Station Operations segment product margin
• $135.8 million (dollar_amount) — Gasoline Distribution and Station Operations segment product margin for Q2 2025
• $3.0 million (dollar_amount) — gain from sale-leaseback transaction

FAQ

Risk Factors

• Commodity Price Volatility [high — market]: The company's cost of sales for commodity products was $7.8 billion for the six months ended June 30, 2025. Volatility in commodity prices significantly impacts these costs and, consequently, profitability.
• Refined Petroleum Products and Renewable Fuels Margins [medium — market]: The Wholesale segment experienced a $15.2 million decrease in product margin, primarily due to lower margins on refined petroleum products and renewable fuels. This indicates sensitivity to market conditions affecting these specific product categories.
• Asset Optimization and Transactions [medium — operational]: The company is actively optimizing its asset base through transactions like sale-leaseback agreements. While this can generate gains (e.g., $3.0 million in the first six months of 2025), it also implies a strategy of divesting or restructuring assets, which carries operational and strategic risks.

Industry Context

Global Partners LP operates in the wholesale and retail distribution of refined petroleum products and renewable fuels, as well as the operation of gas stations. The industry is characterized by significant capital intensity, reliance on commodity prices, and increasing regulatory scrutiny regarding environmental standards and fuel types.

Regulatory Implications

The company faces potential regulatory risks related to environmental compliance, fuel standards, and commodity trading regulations. Changes in environmental policies or mandates for renewable fuels could impact operational costs and product mix.

What Investors Should Do

1. Monitor commodity price trends and their impact on Global Partners LP's cost of sales and segment margins.
2. Analyze the strategic rationale and financial impact of ongoing asset optimization transactions, such as sale-leasebacks.
3. Evaluate the performance divergence between the Wholesale and Gasoline Distribution segments.

Key Dates

• 2025-06-30: End of Second Quarter 2025 — Reporting period for the 10-Q, showing $4.1 billion in total revenues and $55.3 million in net income.
• 2025-08-07: 10-Q Filing Date — The date the company officially submitted its quarterly report to the SEC, providing detailed financial and operational information.

Glossary

Product Margin

The profit generated from selling products after deducting the direct costs associated with those products. (Key metric for assessing the profitability of different business segments, as changes in product margin directly impact overall net income.)

Sale-Leaseback Transaction

A financial arrangement where a company sells an asset it owns and then leases it back from the buyer. (Used by Global Partners LP to optimize its asset base and generate cash, as evidenced by the $3.0 million gain recognized in the first half of 2025.)

Cost of Sales for Commodity Products

The direct costs attributable to the production or purchase of goods sold by the company that are commodities. (Highlights the significant exposure to commodity price fluctuations, with $7.8 billion reported for the first six months of 2025.)

Year-Over-Year Comparison

Total revenues for the three months ended June 30, 2025, were $4.1 billion, a decrease from $4.7 billion in the prior-year period. Net income also declined to $55.3 million from $72.1 million year-over-year. While the Gasoline Distribution and Station Operations segment saw improved product margins, the Wholesale segment experienced a notable decrease, primarily due to lower margins on refined petroleum products and renewable fuels, reflecting shifts in market conditions.

Filing Documents

• glp-20250630x10q.htm (10-Q) — 3599KB
• glp-20250630xex31d1.htm (EX-31.1) — 19KB
• glp-20250630xex31d2.htm (EX-31.2) — 19KB
• glp-20250630xex32d1.htm (EX-32.1) — 10KB
• glp-20250630xex32d2.htm (EX-32.2) — 10KB
• 0001558370-25-010710.txt ( ) — 15152KB
• glp-20250630.xsd (EX-101.SCH) — 67KB
• glp-20250630_cal.xml (EX-101.CAL) — 76KB
• glp-20250630_def.xml (EX-101.DEF) — 383KB
• glp-20250630_lab.xml (EX-101.LAB) — 557KB
• glp-20250630_pre.xml (EX-101.PRE) — 462KB
• glp-20250630x10q_htm.xml (XML) — 3945KB

FINANCIAL INFORMATION

PART I. FINANCIAL INFORMATION

Financial Statements (unaudited)

Item 1. Financial Statements (unaudited) 3 Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024 3 Consolidated Statements of Operations for the three and six months ended June 30, 2025 and 2024 4 Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2025 and 2024 5 Consolidated Statements of Cash Flows for the six months ended June 30, 2025 and 2024 6 Consolidated Statements of Partners' Equity for the three and six months ended June 30, 2025 and 2024 7

Notes to Consolidated Financial Statements

Notes to Consolidated Financial Statements 8

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 38

Quantitative and Qualitative Disclosures About Market Risk

Item 3. Quantitative and Qualitative Disclosures About Market Risk 64

Controls and Procedures

Item 4. Controls and Procedures 66

OTHER INFORMATION

PART II. OTHER INFORMATION 67

Legal Proceedings

Item 1. Legal Proceedings 67

Risk Factors

Item 1A. Risk Factors 67

Unregistered Sales of Equity Securities and Use of Proceeds

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 67

Other Information

Item 5. Other Information 67

Exhibits

Item 6. Exhibits 67

SIGNATURES

SIGNATURES 69 Table of Contents

Financial Statements

Item 1. Financial Statements GLOBAL PARTNERS LP CONSOLIDATED BALANCE SHEETS (In thousands, except unit data) (Unaudited) June 30, December 31, 2025 2024 Assets Current assets: Cash and cash equivalents $ 16,097 $ 8,208 Accounts receivable, net 563,964 472,591 Accounts receivable-affiliates 7,132 6,250 Inventories 495,601 594,072 Brokerage margin deposits 23,879 20,135 Derivative assets 18,182 13,710 Prepaid expenses and other current assets 90,308 92,414 Total current assets 1,215,163 1,207,380 Property and equipment, net 1,668,367 1,706,605 Right of use assets, net 310,900 302,199 Intangible assets, net 15,895 18,683 Goodwill 421,913 421,913 Equity method investments 110,720 92,709 Other assets 41,380 38,709 Total assets $ 3,784,338 $ 3,788,198 Liabilities and partners' equity Current liabilities: Accounts payable $ 590,352 $ 509,975 Working capital revolving credit facility-current portion 98,500 129,500 Lease liability-current portion 53,964 56,780 Environmental liabilities-current portion 7,704 7,704 Trustee taxes payable 83,416 66,753 Accrued expenses and other current liabilities 179,397 223,304 Derivative liabilities 13,931 6,105 Total current liabilities 1,027,264 1,000,121 Working capital revolving credit facility-less current portion 100,000 100,000 Revolving credit facility 88,200 167,000 Senior notes 1,270,916 1,186,723 Lease liability-less current portion 262,358 251,745 Environmental liabilities-less current portion 89,414 91,367 Financing obligations 132,194 134,475 Deferred tax liabilities 60,393 63,548 Other long-term liabilities 67,294 76,606 Total liabilities 3,098,033 3,071,585 Partners' equity Series B preferred limited partners ( 3,000,000 units issued and outstanding at June 30, 2025 and December 31, 2024) 72,305 72,305 Common limited partners ( 33

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note 1. Organization and Basis of Presentation Organization Global Partners LP (the "Partnership") is a master limited partnership formed in March 2005. The Partnership owns, controls or has access to a large terminal network of refined petroleum products and renewable fuels—with connectivity to strategic rail, pipeline and marine assets—spanning from Maine to Florida and into the U.S. Gulf States. The Partnership is one of the largest independent owners, suppliers and operators of gasoline stations and convenience stores, primarily in Massachusetts, Maine, Connecticut, Vermont, New Hampshire, Rhode Island, New York, New Jersey and Pennsylvania (collectively, the "Northeast") and Maryland and Virginia. As of June 30, 2025, the Partnership had a portfolio of 1,553 owned, leased and/or supplied gasoline stations, including 295 directly operated convenience stores, primarily in the Northeast, as well as 66 gasoline stations located in Texas that are operated or supplied by the Partnership's joint venture, Spring Partners Retail LLC ("SPR"). The Partnership is also one of the largest distributors of gasoline, distillates, residual oil and renewable fuels to wholesalers, retailers and commercial customers in the New England states and New York. The Partnership engages in the purchasing, selling, gathering, blending, storing and logistics of transporting petroleum and related products, including gasoline and gasoline blendstocks (such as ethanol), distillates (such as home heating oil, diesel and kerosene), residual oil, renewable fuels, crude oil and propane and in the transportation of petroleum products and renewable fuels by rail from the mid-continent region of the United States and Canada. Global GP LLC, the Partnership's general partner (the "General Partner"), manages the Partnership's operations and activities and employs its officers and substantially all of its personnel, except for most of its ga

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) $ 950.0 million to $ 1.0 billion, and (iii) decreased the revolving credit facility from $ 600.0 million to $ 500.0 million. See Note 6 for additional information on the credit agreement. Investment in Real Estate —On January 23, 2025, the Partnership, through its wholly owned subsidiary, Global HQ 2 LLC, invested in BIG GRP 275 Grove JV LLC, a joint venture formed with unrelated third parties to acquire and operate an office building located in Newton, Massachusetts. Also on January 23, 2025, the Partnership signed a 12-year lease arrangement for space in this property that will serve as the Partnership's principal executive office at the termination of its existing leased space in Waltham, Massachusetts in 2026. See Note 10 for additional information. Basis of Presentation The accompanying consolidated financial statements as of June 30, 2025 and December 31, 2024 and for the three and six months ended June 30, 2025 and 2024 reflect the accounts of the Partnership. Upon consolidation, all intercompany balances and transactions have been eliminated. The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States ("GAAP") and reflect all adjustments (consisting of normal recurring adjustments) which are, in the opinion of management, necessary for a fair presentation of the financial condition and operating results for the interim periods. The interim financial information, which has been prepared pursuant to the rules and regulations of the Securities and Exchange Commission ("SEC"), should be read in conjunction with the consolidated financial statements for the year ended December 31, 2024 and notes thereto contained in the Partnership's Annual Report on Form 10-K. The results of operations for the three and six months ended June 30, 2025 are not necessarily indicative of the results of operations th

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Supplemental Information Related to Lessee Lease Arrangements The following table presents supplemental information related to leases for the periods presented (in thousands): Six Months Ended June 30, 2025 2024 Cash paid for amounts included in the measurement of lease liabilities $ 40,594 $ 41,773 Right-of-use assets obtained in exchange for new lease liabilities $ 37,413 $ 49,782 Concentration of Risk Due to the nature of the Partnership's businesses and its reliance, in part, on consumer travel and spending patterns, the Partnership may experience more demand for gasoline during the late spring and summer months than during the fall and winter months. Travel and recreational activities are typically higher in these months in the geographic areas in which the Partnership operates, increasing the demand for gasoline. Therefore, the Partnership's volumes in gasoline are typically higher in the second and third quarters of the calendar year. As demand for some of the Partnership's refined petroleum products, specifically home heating oil and residual oil for space heating purposes, is generally greater during the winter months, heating oil and residual oil volumes are generally higher during the first and fourth quarters of the calendar year. These factors may result in fluctuations in the Partnership's quarterly operating results. The following table presents the Partnership's product sales and other revenues as a percentage of the consolidated sales for the periods presented: Three Months Ended Six Months Ended June 30, June 30, 2025 2024 2025 2024 Gasoline sales: gasoline and gasoline blendstocks (such as ethanol) 70 % 70 % 65 % 65 % Distillates (home heating oil, diesel and kerosene), residual oil and crude oil sales 27 % 27 % 32 % 32 % Convenience store and prepared food sales, rental income and sundries 3 % 3 % 3

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Note 2. Revenue from Contracts with Customers Disaggregation of Revenue The following table provides the disaggregation of revenue from contracts with customers and other sales by segment for the periods presented (in thousands): Three Months Ended June 30, 2025 Revenue from contracts with customers: Wholesale GDSO Commercial Total Petroleum and related product sales $ 676,614 $ 1,077,203 $ 210,796 $ 1,964,613 Station operations — 120,228 — 120,228 Total revenue from contracts with customers 676,614 1,197,431 210,796 2,084,841 Other sales: Revenue originating as physical forward sale contracts and exchange agreements 2,454,816 — 65,055 2,519,871 Revenue from leases 1,070 21,143 — 22,213 Total other sales 2,455,886 21,143 65,055 2,542,084 Total sales $ 3,132,500 $ 1,218,574 $ 275,851 $ 4,626,925 Three Months Ended June 30, 2024 Revenue from contracts with customers: Wholesale GDSO Commercial Total Petroleum and related product sales $ 643,808 $ 1,316,548 $ 193,105 $ 2,153,461 Station operations — 128,456 — 128,456 Total revenue from contracts with customers 643,808 1,445,004 193,105 2,281,917 Other sales: Revenue originating as physical forward sale contracts and exchange agreements 2,018,044 — 87,832 2,105,876 Revenue from leases 836 21,069 — 21,905 Total other sales 2,018,880 21,069 87,832 2,127,781 Total sales $ 2,662,688 $ 1,466,073 $ 280,937 $ 4,409,698 Six Months Ended June 30, 2025 Revenue from contracts with customers: Wholesale GDSO Commercial Total Petroleum and related product sales $ 1,542,803 $ 2,082,558 $ 413,307 $ 4,038,668 Station operations — 220,582 — 220,582 Total revenue from contracts with customers 1,542,803 2,303,140 413,307 4,259,250 Other sales: Revenue originating as physical

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) Six Months Ended June 30, 2024 Revenue from contracts with customers: Wholesale GDSO Commercial Total Petroleum and related product sales $ 1,457,227 $ 2,413,825 $ 375,226 $ 4,246,278 Station operations — 238,288 — 238,288 Total revenue from contracts with customers 1,457,227 2,652,113 375,226 4,484,566 Other sales: Revenue originating as physical forward sale contracts and exchange agreements 3,843,229 — 184,310 4,027,539 Revenue from leases 1,580 41,405 — 42,985 Total other sales 3,844,809 41,405 184,310 4,070,524 Total sales $ 5,302,036 $ 2,693,518 $ 559,536 $ 8,555,090 Contract Balances A receivable, which is included in accounts receivable, net in the accompanying consolidated balance sheets, is recognized in the period the Partnership provides services when its right to consideration is unconditional. In contrast, a contract asset will be recognized when the Partnership has fulfilled a contract obligation but must perform other obligations before being entitled to payment. The Partnership had no significant contract assets at both June 30, 2025 and December 31, 2024. The nature of the receivables related to revenue from contracts with customers and other revenue, as well as contract assets, are the same, given they are related to the same customers and have the same risk profile and securitization. Payment terms on invoiced amounts are typically 2 to 30 days . A contract liability is recognized when the Partnership has an obligation to transfer goods or services to a customer for which the Partnership has received consideration (or the amount is due) from the customer. The Partnership had no significant contract liabilities at both June 30, 2025 and December 31, 2024. Note 3. Inventories The Partnership hedges substantially all of its petroleum and ethanol inventory using a variety of instruments, primarily exchan

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