WaterBridge Lifts 2026 Outlook After Record Quarter: Revenue Up 10% to $240.2 Million

WaterBridge (NYSE: WBI) raised its full-year 2026 guidance after posting record third-quarter revenue of $240.2 million, up 10% sequentially, and record produced water handling volumes of 2.8 million barrels per day — a 6% increase from the prior quarter. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) climbed 7% quarter-over-quarter to $124.2 million.

The company lifted the midpoint of its full-year produced water volume guidance by 2% and its adjusted EBITDA midpoint by 4%. The driver, according to management, is accelerating customer activity in the Delaware Basin — particularly along the Stateline and in New Mexico — combined with the ramp-up of the Speedway pipeline.

CEO Jason Long said disposal capacity in active areas is constrained by elevated pore pressure (underground fluid pressure in rock formations), which is creating demand for infrastructure that can move water to locations with more reliable capacity.

What does the new guidance look like?

The updated 2026 outlook now includes:

• Produced water handling volumes: 2.65 million to 2.75 million barrels per day, versus the prior range of 2.55 million to 2.75 million.
• Adjusted EBITDA: $465 million to $485 million, up from $435 million to $475 million.
• Capital expenditures: $530 million to $560 million, compared with $530 million to $590 million previously.

CFO Scott McNeely said the lower capital spending midpoint reflects payment timing shifting from late 2026 into early 2027, not a change in when projects come online. The company spent $123.9 million on capital projects during the third quarter.

Adjusted EBITDA margin came in at roughly 52%, within the 50%–53% band reported over the preceding four quarters. Guidance for 2027 will arrive with fourth-quarter results.

In short: WaterBridge is raising the top and bottom of its earnings outlook while trimming the top of its spending range.

Why is Speedway outperforming?

COO Michael Chop Reitz said Speedway Phase I began moving volumes in July and that utilization has exceeded expectations, with throughput on the western portion of the system performing especially well.

WaterBridge has signed several new agreements with exploration and production customers for Speedway volumes that require little additional capital. Produced water handling revenue, excluding skim oil, rose to $0.77 per barrel from $0.72 a year earlier. Reitz credited higher contract rates, including rates on long-haul pipelines and short-term interruptible capacity in pressure-stressed areas.

Speedway Phase II is still in engineering and planning, and management said its timing depends on firm customer commitments and Phase I utilization. McNeely said some operators wanted to finish work tied to industry consolidation and their budgeting cycles before committing at Phase II's scale.

"We do think that comes here in the coming months, and those could very well support an FID on Phase II," McNeely said, referring to a final investment decision. He added that Phase I still has available capacity and that smaller projects across the network also offer attractive returns.

Reitz also noted WaterBridge has integrated its acquired Ranger system into Speedway, boosting reliability for both, and can expand Ranger's capacity through Speedway without deploying capital for deep wells in New Mexico.

Are data centers a real opportunity?

Long said WaterBridge has made significant commercial progress on a water supply solution for a large-scale data center. Separately, PowerBridge has broken ground on its Alpha Digital Campus on LandBridge acreage in Reeves County, Texas.

PowerBridge expects WaterBridge to source, treat and deliver non-potable water for the campus's cooling system and to manage produced and discharged water from the site. Long said PowerBridge has committed not to use municipal or community water for industrial purposes there.

McNeely said prospective customers are comfortable using treated non-potable brackish water, while treated produced water carries a longer timeline due to more involved treatment requirements and regulatory complexity. Returns on digital infrastructure water projects, he said, are competitive with WaterBridge's other investment opportunities.

How does the balance sheet stack up?

WaterBridge ended the quarter with $539.7 million in liquidity — including $34.7 million in cash — and $1.8 billion in total debt. Its covenant net leverage ratio stood at 3.5 times, above its long-term target of less than 3 times.

In August, the company increased commitments under its revolving credit facility to $750 million from $500 million. It also issued an additional $150 million of 6.5% senior unsecured notes due 2033 and used the proceeds to repay revolver borrowings. The board declared a dividend of $0.05 per share, payable Dec. 10 to shareholders of record as of Nov. 25.

Asked about the election's regulatory impact, McNeely said he doesn't expect an abrupt change in how produced water is regulated. The company is monitoring producer sentiment, permitting and commodity prices, but he sees no major near-term shift in operator activity.

The takeaway: volumes are compounding, the leverage ratio has room to fall, and Phase II could be the next catalyst.