Executive Summary: Saudi Aramco Q3 2025 Interim Report
Saudi Aramco demonstrated robust operational momentum and financial resilience in the third quarter of 2025, driven by strategic expansions in gas production and global downstream integration.
1. Financial Performance
- Net Income: Reported 101 billion SAR (approximately 26.9 billion USD), with an adjusted net income of 28 billion USD.
- Cash Flow & Dividends: Free cash flow reached 23.6 billion USD. Total dividends paid in the first nine months of 2025 amounted to 64.1 billion USD, including base and performance-linked distributions.
- Balance Sheet: Maintained a strong gearing ratio of 6.3% as of September 30, 2025.
2. Upstream: Gas Strategy Acceleration
- Production: Total hydrocarbon production averaged 13.3 mmboed.
- Revised Gas Targets: Raised the 2030 sales gas capacity growth target to 80% (up from 60%) compared to 2021 levels.
- Jafurah Project: Completed an 11.1 billion USD midstream deal with a BlackRock-led consortium. Phase I of the Jafurah gas plant is on track for 2025 completion.
3. Downstream: Global Expansion
- China Integration: Initial investment in the Fujian integrated refining and petrochemical complex (320,000 bpd capacity), expected to be fully operational by 2030.
- Petro Rabigh: Increased ownership to 60% after acquiring an additional 22.5% stake from Sumitomo Chemical to lead its strategic turnaround.
- Retail Growth: Expanded footprint in Asia by acquiring a 25% stake in Unioil (Philippines).
4. Innovation & Financing
- AI Strategy: Planned acquisition of a minority stake in HUMAIN (a PIF-owned AI company) to enhance digital transformation.
- Capital Markets: Successfully issued 3 billion USD in international Sukuk to optimize liquidity.
- R&D: Collaborations with Honeywell and KAUST to advance Direct Crude-to-Chemicals technology.
The table compares the performance of Q3 2025 against Q3 2024 (YoY) and shows the percentage of each item relative to total revenue (including other income related to sales).
Saudi Aramco: Condensed Consolidated Statement of Income (Q3 2025)
Unit: SAR Million
| Item | 2025 Q3 | % of Total Rev | 2024 Q3 | YoY Change |
| Revenue | 386,165 | 92.3% | 416,628 | -7.3% |
| Other income related to sales | 31,995 | 7.7% | 47,997 | -33.3% |
| Total Revenue and Other Income | 418,160 | 100.0% | 464,625 | -10.0% |
| Operating Costs: | ||||
| Royalties and other taxes | (37,129) | -8.9% | (50,689) | -26.8% |
| Purchases | (102,562) | -24.5% | (143,676) | -28.6% |
| Producing and manufacturing | (32,311) | -7.7% | (27,402) | +17.9% |
| Selling, general and administrative (SG&A) | (20,891) | -5.0% | (17,476) | +19.5% |
| Depreciation and amortization | (28,183) | -6.7% | (28,344) | -0.6% |
| Other operating costs (Exploration, R&D) | (3,564) | -0.9% | (4,223) | -15.6% |
| Total Operating Costs | (224,640) | -53.7% | (271,810) | -17.4% |
| Operating Income | 193,520 | 46.3% | 192,815 | +0.4% |
| Share of results of joint ventures and associates | (1,265) | -0.3% | (1,011) | +25.1% |
| Finance and other income | 4,242 | 1.0% | 5,573 | -23.9% |
| Finance costs | (2,301) | -0.6% | (2,262) | +1.7% |
| Income before taxes and zakat | 194,196 | 46.4% | 195,115 | -0.5% |
| Income taxes and zakat | (93,181) | -22.3% | (91,750) | +1.6% |
| Net Income | 101,015 | 24.2% | 103,365 | -2.3% |
Key Financial Analysis
- Resilient Profitability Amid Revenue Decline (YoY):Total revenue and other income decreased by 10.0% YoY, primarily due to lower crude oil prices and reduced sales volumes. However, Operating Income grew slightly by 0.4%. This was achieved through a significant 17.4% reduction in total operating costs, specifically in purchases (-28.6%) and royalties (-26.8%), which offset the impact of falling revenues.
- Net Margin Improvement:The net profit margin for Q3 2025 rose to 24.2%, compared to 22.2% in Q3 2024. This indicates that despite a weaker price environment, the company’s cost management strategies effectively increased the profit generated per unit of revenue.
- Strong Sequential Growth (QoQ):Compared to the previous quarter (Q2 2025), Net Income increased by 18.8% (from 85 billion SAR to 101 billion SAR). This growth was driven by higher crude oil sales volumes, improved refining and chemicals margins, and further optimization of operating costs.
The comparison base for this balance sheet is September 30, 2025, versus December 31, 2024 (Year-End 2024), following the standard format for interim financial reporting.
Saudi Aramco: Condensed Consolidated Balance Sheet (Q3 2025)
Unit: SAR Million
| Item | Sep 30, 2025 | % of Total Assets | Dec 31, 2024 | Change vs YE 2024 |
| Assets | ||||
| Non-current assets | 1,930,857 | 76.7% | 1,858,234 | +3.9% |
| Property, plant and equipment (PPE) | 1,576,922 | 62.7% | 1,494,318 | +5.5% |
| Investments and others | 353,935 | 14.1% | 363,916 | -2.7% |
| Current assets | 585,574 | 23.3% | 565,396 | +3.6% |
| Cash and cash equivalents | 193,873 | 7.7% | 216,642 | -10.5% |
| Trade receivables | 196,458 | 7.8% | 167,884 | +17.0% |
| Inventories | 80,904 | 3.2% | 83,728 | -3.4% |
| Total Assets | 2,516,431 | 100.0% | 2,423,630 | +3.8% |
| Equity & Liabilities | ||||
| Shareholders’ equity | 1,499,949 | 59.6% | 1,458,229 | +2.9% |
| Retained earnings | 1,384,766 | 55.0% | 1,348,442 | +2.7% |
| Non-controlling interests | 191,679 | 7.6% | 193,126 | -0.7% |
| Total Equity | 1,691,628 | 67.2% | 1,651,355 | +2.4% |
| Non-current liabilities | 531,579 | 21.1% | 473,012 | +12.4% |
| Borrowings | 310,446 | 12.3% | 261,733 | +18.6% |
| Current liabilities | 293,224 | 11.7% | 299,263 | -2.0% |
| Borrowings | 46,094 | 1.8% | 57,557 | -19.9% |
| Income taxes and zakat payable | 76,566 | 3.0% | 71,951 | +6.4% |
| Total Liabilities | 824,803 | 32.8% | 772,275 | +6.8% |
| Total Equity and Liabilities | 2,516,431 | 100.0% | 2,423,630 | +3.8% |
Key Balance Sheet Analysis
- CapEx-Driven Asset Growth:Total assets grew by 3.8%, primarily driven by a 5.5% increase in Property, Plant, and Equipment (PPE). This reflects Saudi Aramco’s continued commitment to large-scale capital expenditures, including the Jafurah gas plant and various oil field increment projects.
- Cash Management and Debt Optimization:
- Cash Decrease (-10.5%): Cash and cash equivalents declined from 216.6 billion SAR to 193.9 billion SAR. This was largely due to substantial dividend payments (approx. 240.3 billion SAR in the first nine months) and heavy CapEx, despite inflows from new bond issuances.
- Debt Restructuring: Non-current borrowings increased significantly by 18.6%, while current borrowings fell by 19.9%. This indicates a strategic shift to long-term financing—such as the 5 billion USD bond in June and the 3 billion USD Sukuk in September—to replace short-term debt and enhance financial stability.
- Working Capital Changes:Trade receivables saw a notable 17.0% increase. This is typically linked to the timing of sales or fluctuations in oil and product prices, though it may also suggest a longer cash collection cycle for certain segments.
- Exceptional Financial Stability:The company’s Gearing Ratio remains very low at 6.3%. With equity accounting for 67.2% of total assets, Saudi Aramco demonstrates a highly conservative capital structure, relying predominantly on its own funds rather than high leverage.
According to the Saudi Aramco Q3 2025 Interim Report, the company reduced its purchase costs and overall operating expenses through several key strategic factors:
1. Control of Purchase Volumes and Market Pricing
The significant decrease in operating costs during the third quarter and first nine months of 2025 was primarily driven by the “Purchases” line item.
- Reduced Crude Purchase Volumes: The main contributor to lower purchase costs was a decrease in the volumes of crude oil purchased from external sources. This indicates a tactical adjustment in how the company sources its feedstock.
- Benefit from Lower Product Prices: While the volume of certain refined and chemical products purchased actually increased, the overall total cost was driven down by a decline in the purchase prices of refined and chemical products, offsetting the increased volume.
2. Structural Cost Reduction through Technology
Saudi Aramco actively utilizes research and development to lower long-term capital and operational expenditures:
- Direct Crude-to-Chemicals (COTC) Technology: By collaborating with Honeywell and KAUST, the company is developing technology to convert crude oil directly into high-value chemicals like light olefins. This process bypasses traditional refining steps, with the explicit goal of reducing both capital expenditure (CapEx) and operating expenditure (OpEx).
- Digitalization and Artificial Intelligence: Through investments in AI (such as the HUMAIN acquisition) and digital infrastructure, the company leverages advanced solutions to enhance operational efficiency, optimize resource utilization, and indirectly control costs through smarter asset management.
3. Project Phasing and Capital Management
In terms of capital-related purchasing, the company manages cash outflows by adjusting project timelines:
- Strategic Phasing: The reduction in Upstream capital expenditures was partly due to the phasing of crude oil increment projects. By strategically timing the procurement and construction phases of projects meant to maintain Maximum Sustainable Capacity (MSC), the company can better manage immediate spending pressures.
4. Mitigation of Market Volatility via Accounting Methods
While not a direct reduction in cash outflow, the company’s internal reporting and management of inventory help stabilize cost reflections:
- Replacement Cost Methodology: Aramco uses a replacement cost method to measure the impact of inventory changes. By evaluating inventory based on current supply costs rather than historical prices, the company ensures that its reported costs are more reflective of the current market environment, providing a buffer against extreme price volatility in the supply chain.
According to the Saudi Aramco Q3 2025 Interim Report, the company has decided to raise its 2030 sales gas capacity growth target from the previous 60% to approximately 80% (relative to 2021 production levels).
The primary reasons and drivers for this strategic adjustment are as follows:
1. Capturing High-Value Associated Liquids
This is the most economically significant driver for the revised target. By increasing sales gas capacity, Saudi Aramco expects to increase the production of high-value associated liquids by more than 1 million barrels per day (mmbpd).
- Expanding gas extraction is not only about supplying gas itself but also about capturing the accompanying condensate and Natural Gas Liquids (NGLs).
- In total, the company expects combined production of gas and related liquids to reach approximately 6 million barrels of oil equivalent per day (mmboed) by 2030.
2. Meeting Growing Energy Demand
A core pillar of the company’s strategy is “value-accretive growth” while meeting rising energy demand in the market. Raising the gas target reflects the company’s ability to adapt to new market realities and leverage its advanced upstream capabilities to seize opportunities arising from increased demand.
3. Leveraging Advanced Capabilities and Unconventional Resources (Jafurah)
The company’s confidence in raising this target stems from significant progress in unconventional gas fields, particularly the Jafurah gas field:
- Jafurah Expansion: The project is progressing well, with Phase I expected to be completed in 2025. It has also successfully attracted massive international investment, such as the 11.1 billion USD midstream deal with a BlackRock-led consortium, validating the value of these assets.
- Capacity Boost: Jafurah is expected to produce 2.0 billion standard cubic feet per day (bscfd) of sales gas by 2030, along with substantial volumes of ethane, NGLs, and condensate.
4. Support from Other Key Projects
Beyond Jafurah, several other ongoing gas processing projects support this higher target:
- Tanajib Gas Plant: Part of the Marjan and Zuluf field developments, this plant is expected to be completed in 2025, adding 2.6 bscfd of raw gas processing capacity.
- Fadhili Gas Plant Expansion: This expansion is expected to add another 1.5 bscfd of processing capacity by 2027.
According to the Saudi Aramco Q3 2025 Interim Report, HUMAIN is a company owned by the Saudi Public Investment Fund (PIF) that specializes in the field of Artificial Intelligence (AI).
The following provides a detailed overview of HUMAIN and Saudi Aramco’s strategic involvement:
1. Nature of the Company and Scope of Business
HUMAIN is dedicated to providing a wide range of AI products and services, with core business areas including:
- Next-generation data centers: Providing the essential infrastructure support for high-intensity AI computing.
- Cloud capabilities: Offering flexible and scalable computing resources.
- Advanced AI models and solutions: Developing and deploying cutting-edge AI algorithms to solve real-world industrial and commercial challenges.
2. Saudi Aramco’s Investment Plan
In October 2025, Saudi Aramco announced the signing of a non-binding term sheet with the PIF to make a strategic investment in HUMAIN:
- Equity Structure: Saudi Aramco plans to acquire a significant minority stake in HUMAIN, while the PIF will retain its position as the majority shareholder.
- Current Status: The transaction is subject to the signing of definitive agreements and the receipt of relevant regulatory approvals.
3. Strategic Objectives: Forging a Powerful Alliance
This investment represents a pivotal step in Saudi Aramco’s digital transformation strategy, aiming to create synergies through resource integration:
- Resource Integration: The plan aims to unify the AI assets, capabilities, and talent of both the PIF and Saudi Aramco.
- Accelerated Expansion: By combining Saudi Aramco’s vast industrial application scenarios and financial backing, the goal is to rapidly scale HUMAIN’s operations, enabling it to capture value and accelerate growth in the fast-evolving AI sector.
- Driving Innovation: Leveraging advanced AI solutions will further drive internal innovation and digitalization processes across Saudi Aramco’s global operations.
Summary
HUMAIN serves as Saudi Arabia’s national-level AI computing and innovation engine. By taking a stake in HUMAIN, Saudi Aramco is not merely making a financial investment; it is strategically aligning its massive energy data and industrial requirements with HUMAIN’s technical AI expertise. Together, they aim to build a robust AI ecosystem capable of serving the energy industry and the broader global market.