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    MUSA
    Earnings call· Jun 2026(Q2 FY26)

    Murphy USA Q2 FY26 earnings call MUSA

    Aug 6, 2026 Source

    Executive summary

    Murphy USA Q2 FY26 — Strong Fuel Margins and Loyalty Program Growth

    Murphy USA delivered resilient Q2 FY26 results, driven by strong fuel margin performance and growth in merchandise contribution, despite consumer budget pressures and market volatility. Management maintains a conservative outlook for the second half, emphasizing operational execution and the benefits of its loyalty program and strategic asset base. The company continues to invest in new store development and existing store lifecycle improvements, while also returning capital to shareholders through share repurchases.

    Highlights

    5

    • Fuel volume performance was positive 0.5% in Q2 FY26, despite a volatile pricing environment.

    • Retail fuel margins are stabilizing at higher levels, with August margins opening in the 'high 30s' cents per gallon.

    • Murphy Drive Rewards (MDR) sign-ups exceeded $600,000 a month in Q2 FY26, with approaching 46% new or lapsed customers.

    • Quick Check's Q2 performance is stabilizing, with food and beverage sales and margin turning positive.

    • Overall merchandise contribution dollars grew, and positive margin growth was delivered despite consumer pressures.

    Concerns

    5

    • Fuel margin guidance for H2 FY26 is 'somewhat conservative' due to market volatility and uncertainty.

    • Merchandise sales are expected to be at the 'low end of the range' for FY26 due to consumer budget pressures and Q1 weather impacts.

    • New-to-Industry (NTI) store openings are projected at the 'lower end of our stated range' (45 stores) for FY26, excluding tuck-in acquisitions.

    • The nicotine category faces a 'tough third quarter comp' due to lapping a prior year promotion.

    • Lottery and beer sales remain a challenge due to pinched consumer wallets and shifting preferences.

    Guidance & targets

    4
    CategoryTargetConfidence
    Fuel margin
    $0.35 all-in margin
    high materiality
    High
    Merchandise sales
    towards the low end of the range
    medium materiality
    Medium
    New-to-Industry (NTI) store openings
    closer to the 45 new stores
    medium materiality
    High
    Same-store fuel gallons
    down 1% to down 3%
    high materiality
    High

    Segment performance

    1
    SegmentRevenueYoYQoQMargin
    Quick Check
    Q2 performance is stabilizing with positive trends in food and beverage. Initiatives include growing the sandwich category, new bakery recipes (buttered roll, croissant s), and relaunching free coffee Friday. The company is evolving QC into a sales-first culture, improving basics like labor and shrink, and simplifying the operating model.
    Sandwich category: growingBakery: growthHot and iced coffee results: improvingPromotional response: stronger
    		———food and beverage sales and margin turning positive

    Operational metrics

    12
    Same-store fuel volume
    positive 0.5%YoY
    Q2 FY26

    Very encouraging given the pricing environment.

    Same-store fuel volume
    increased 1.6%YoY
    May FY26

    Occurred when RBOB declined 16%, allowing for price differentiation.

    Same-store fuel volume
    picked up over 2%vs prior year
    last half of May FY26

    Occurred when RBOB fell 18%.

    Same-store fuel volume
    up 1.5%
    August FY26 (first 5 days)

    As the market has dropped some.

    Fuel margin
    high 30s
    August FY26 (opening)

    Higher than at the beginning of the month.

    Murphy Drive Rewards (MDR) sign-ups
    over $600,000 a monthup from around $400,000 a month
    Q2 FY26

    Expanding the top of the loyalty funnel.

    New or lapsed customers (MDR)
    approaching 46%up from 40% in Q1
    Q2 FY26

    Indicates successful attraction of new customer segments.

    RBOB prices
    down 2%finished the quarter
    Q2 FY26

    Despite overall decline, the quarter saw extreme offsetting movements.

    Stores with fuel prices above $4
    18%
    Q2 FY26

    Frequency of high absolute price levels.

    RBOB prices
    declined 16%
    May FY26

    Allowed for price differentiation and volume capture.

    RBOB prices
    fell actually 18%
    last half of May FY26

    Contributed to significant volume pickup.

    Controllables piece of business (fuel supply)
    $0.07versus $0.25 last year
    Q2 FY26

    Reflects the advantage of their asset base in a scarce product environment.

    Industry KPIs

    3
    MetricValueDetails
    Store count growth45stores
    Active customers nspacover $600,000 a monthsign-ups
    Share buyback capital return—

    Risks & headwinds

    6
    Market volatility and uncertainty in fuel marginsrest of the year

    very difficult to predict where we're going to land

    Mitigation: Conservative margin forecast, managing business to outperform commitments.

    Consumer budget pressures impacting merchandise salesrest of the year

    Leading to 'low end of the range' for merchandise target.

    Mitigation: Focus on core center-of-store categories, targeted promotions, and value offerings.

    Geopolitical conflict causing supply shock and tightnesswell into next year

    material impact on domestic inventories and flows essentially globally

    Mitigation: Leveraging existing asset base for product acquisition (ship channel, refineries, terminals).

    Competitive pressures in specific markets (e.g., Colorado, Florida)Ongoing, but eventually stabilizes.

    Initial 'painful' period with lower margins as volumes redistribute.

    Mitigation: Fighting to retain market share, relying on the 'recipe' of eventual margin stabilization at higher levels.

    Tough Q3 comp for nicotine due to prior year promotionQ3 FY26

    tough third quarter comp as we lap that [indiscernible] promotion

    Mitigation: Strength in combustibles (value-priced cigarettes), emerging OTP opportunities (new gen pouches, flavored vapes), and active participation in promotions.

    Declining lottery and beer salesOngoing

    Lauda lottery remains a challenge and Beer remains a challenge

    Mitigation: Focus on other strong merchandise categories, recognizing broader industry trends.

    What to watch in Q3 FY26

    5

    Fuel margin performance

    Next quarter (Q3 FY26)
    Currenthigh 30s
    TargetSustained high margins, potentially outperforming conservative guidance.

    Why it matters

    Fuel margins are a primary driver of profitability, and management's conservative guidance suggests potential upside if market conditions (e.g., prolonged price fall-off) allow.

    So you could call our margin forecast somewhat conservative. I would agree with that. But I would also say that that's intentional on our part because we don't know what it's going to be. And we manage our business to try to outperform our commitments.

    Q&A highlights

    6

    Why is fuel margin guidance conservative, and why is merchandise guidance at the low end?

    Fuel margin guidance is conservative due to market volatility, but a higher floor for retail margins is observed. Merchandise guidance is at the low end due to consumer budget pressures and Q1 weather impact.

    “So you could call our margin forecast somewhat conservative. I would agree with that. But I would also say that that's intentional on our part because we don't know what it's going to be.”

    asked by Irene Nattel · answered by Mindy West

    2 min read5 chapters

    Detailed Narrative

    01

    Fuel Market Dynamics and Supply Tightness

    Management discussed the current geopolitical conflict's impact on domestic inventories and global flows, noting it's a supply shock unlike previous demand shocks. They believe a return to normal is unlikely in the near term, with tightness and volatility persisting 'well into next year' due to infrastructure damage overseas and the prolonged nature of the conflict. This environment magnifies the value of Murphy USA's asset base, allowing them to acquire product at the ship channel and direct from refineries.

    02

    New Store Development and Capital Allocation

    The company expects to deliver 45 new stores organically in FY26, at the lower end of its original range, excluding potential tuck-in acquisitions. They are pulling forward construction for some FY27 stores and making proactive lifecycle investments in existing stores (dispensers, HVAC). Capital expenditure is trending towards the high end of the range, also driven by investments in their land bank for future growth. Share repurchase remains a key capital allocation lever, supported by strong cash flow.

    03

    Loyalty Program (MDR) Success

    The Murphy Drive Rewards (MDR) program continues to show strong momentum, with sign-ups exceeding 600,000 per month in Q2 FY26, up from 400,000. A significant portion (approaching 46%) of new sign-ups are new or lapsed customers. The platform enables targeted promotions, such as 'spend $5 inside, save $0.05 on gas,' successfully driving pump-to-store conversion and fostering loyal customer behavior.

    04

    Merchandise Performance and Consumer Pressures

    While overall merchandise contribution dollars grew, the company noted consumer budget pressures impacting nondiscretionary items. Strength was observed in core center-of-store categories like packaged beverages (energy drinks) and chocolate candy, with successful promotions. However, lottery and beer sales faced challenges due to pinched wallets and shifting consumer preferences, reflecting broader industry trends. Nicotine sales, particularly value-priced cigarettes and new gen pouches, remained a tailwind.

    05

    Quick Check Turnaround

    Quick Check's Q2 performance is stabilizing, with food and beverage sales and margins turning positive. Initiatives include growing the sandwich category, improving bakery offerings (new recipes, croissant s), and enhancing hot/iced coffee results. The focus is on evolving QC into a 'sales first culture' similar to Murphy, improving basics like labor and shrink, and simplifying the operating model, with early signs of stronger promotional response.

    AI-generated summary of the company’s earnings call. Not investment advice.