Net Income Per Common Unit

9 Months Ended

Sep. 30, 2025

We calculate basic and diluted net income per common unit by dividing income from continuing operations attributable to PAA (after deducting amounts allocated to the preferred unitholders and participating securities) and income from discontinued operations by the basic and diluted weighted average number of common units outstanding during the period.

The diluted weighted average number of common units is computed based on the weighted average number of common units plus the effect of potentially dilutive securities outstanding during the period, which include (i) our Series A preferred units and (ii) our equity-indexed compensation plan awards. See Note 11 and Note 17 to our Consolidated Financial Statements included in Part IV of our 2024 Annual Report on Form 10-K for a discussion of our Series A preferred units and equity-indexed compensation plan awards. When applying the if-converted method prescribed by FASB guidance, on a weighted-average basis, for the three and nine months ended September 30, 2025, the possible conversion of approximately 58 million and 60 million Series A preferred units, respectively, and for each of the three and nine months ended September 30, 2024, the possible conversion of approximately 71 million Series A preferred units were excluded from the calculation of diluted net income per common unit as the effect was antidilutive. Our equity-indexed compensation plan awards that contemplate the issuance of common units are considered potentially dilutive unless (i) they become vested only upon the satisfaction of a performance condition and (ii) that performance condition has yet to be satisfied. Equity-indexed compensation plan awards that are deemed to be dilutive during the period are reduced by a hypothetical common unit repurchase based on the remaining unamortized fair value, as prescribed by the treasury stock method in guidance issued by the FASB.

The following table sets forth the computation of basic and diluted net income per common unit (in millions, except per unit data):


	Three Months Ended September 30,				Nine Months Ended September 30,
	2025		2024		2025		2024
Basic and Diluted Net Income per Common Unit
Continuing Operations:
Income from continuing operations, net of tax	$	453	$	198	$	1,061	$	837
Net income attributable to noncontrolling interests	(88)		(92)		(249)		(257)
Net income from continuing operations attributable to PAA	365		106		812		580
Distributions to Series A preferred unitholders	(36)		(44)		(110)		(131)
Distributions to Series B preferred unitholders	(18)		(19)		(53)		(59)
Amounts allocated to participating securities	(1)		(1)		(10)		(9)
Impact from repurchase of Series A preferred units (1)	—		—		(43)		—
Other	1		1		3		3
Net income from continuing operations allocated to common unitholders - Basic and Diluted (2)	$	311	$	43	$	599	$	384

Discontinued Operations:
Net income from discontinued operations allocated to common unitholders - Basic and Diluted (3)	$	76	$	114	$	281	$	156

Net income allocated to common unitholders — Basic and Diluted	$	387	$	157	$	880	$	540

Basic and diluted weighted average common units outstanding	704		702		704		702

Basic and diluted net income per common unit:
Continuing operations	$	0.44	$	0.06	$	0.85	$	0.55
Discontinued operations	0.11		0.16		0.40		0.22
Basic and diluted net income per common unit	$	0.55	$	0.22	$	1.25	$	0.77

(1)We repurchased approximately 12.7 million Series A preferred units on January 31, 2025. See Note 7 for additional information. The difference between the cash we paid for the repurchase of such units and their carrying value on our balance sheet is considered a return to Series A preferred unitholders for the calculation of net income allocated to common unitholders.

(2)We calculate net income from continuing operations allocated to common unitholders based on the distributions pertaining to the current period’s net income. After adjusting for the appropriate period’s distributions, the remaining undistributed earnings or excess distributions over earnings (i.e., undistributed loss), if any, are allocated to the common unitholders and participating securities in accordance with the contractual terms of our partnership agreement in effect for the period and as further prescribed under the two-class method.

(3)Net income from discontinued operations allocated to common unitholders is Income from discontinued operations, net of tax as presented on our Condensed Consolidated Statements of Operations.