Tidewater (TDW) Q3 2026 Earnings Report

The call was strongly constructive. Tidewater exceeded quarterly expectations, delivered more than 40% free-cash-flow growth, achieved a third consecutive quarter of leading-edge day-rate increases, completed the Wilson Sons acquisition, restarted share repurchases and issued higher-margin 2027 guidance. These positives outweighed conflict-related costs, lower utilization, repair and dry-dock impacts, regional weaknesses and Brazil timing delays.

Guidance calls for full year 2026 revenue of $1.43 billion to $1.44 billion and gross margin of 47.5% to 48.5%, with fourth quarter revenue increasing approximately 11% and fourth quarter gross margin of about 48%; 2027 revenue guidance is $1.70 billion to $1.75 billion and gross margin guidance is 51% to 53%, with revenue roughly flat into the first quarter, a nice pickup in the second quarter and improvement as we progress through the remainder of the year, while margins are expected to be roughly flat in the first quarter from the fourth, with each quarter thereafter benefiting from operating leverage. The 2027 guidance assumes an approximately $2,700 per day year-over-year day-rate increase, trending up quarter-over-quarter, active utilization of approximately 82%, and leaves approximately 9% of capacity to be chartered; combined fleet backlog is $1.1 billion, or approximately 64% of the midpoint, with approximately 54% of available days captured in firm backlog and options. Full year 2026 guidance assumes utilization of approximately 80%, approximately 78% of remaining available days captured in firm backlog and options, and approximately 11% of capacity available in the fourth quarter; approximately $5 million of conflict-related costs, approximately $9 million of down for repair revenue loss and R&M expense, approximately $2 million of capacity reduction impact and approximately $4 million from lower-than-anticipated day rates and contract extensions are expected to affect fourth quarter results. 2026 guidance includes approximately 140 basis points of cost burden from Operation Epic Fury, while 2027 assumes very modest impacts; 2026 dry dock costs are expected to be approximately $109 million and capital expenditures approximately $47 million, versus 2027 dry dock costs of $147 million and capital expenditures of $46 million, with dry dock days expected to affect utilization by about 4 percentage points.