Tidewater's Day-Rate Gain Accelerates After a Flat First Quarter
The offshore vessel operator posted $342.3 million of second-quarter revenue and lifted its average day rate $655 to $22,938, the largest sequential jump since the third quarter of 2024.
Tidewater Inc. (TDW) posted revenue of $342.3 million for the three months ended June 30, 2026, a 4.9% increase from the first quarter, as realized day rates and utilization both rose after a first quarter in which the average day rate had been essentially unchanged from a year earlier.
The average day rate was $22,938, up $655, or 2.9%, from the first quarter. The company said that was the largest absolute sequential day-rate improvement since the third quarter of 2024. Weighted average leading-edge day rates rose 7.5% to $24,341. President and Chief Executive Officer Quintin Kneen said the second quarter came in above the company’s expectations, with revenue outperformance and lower-than-expected operating expenses, and that day-rate momentum was driven primarily by the largest class of production support vessels, with gains across multiple regional segments.
Term-contract fixtures accelerated. The weighted average term-contract rate rose about 7.5% sequentially, or about $1,690 a day, to $24,341. In the first quarter, Tidewater had said term-contract day rates had increased for the first time since the second quarter of 2025. Utilization also came in higher than anticipated, largely because drydocks on certain vessels moved later in the year.
Gross margin was 46.9%, down modestly from the first quarter because of costs associated with the conflict in the Middle East, though the margin still came in ahead of expectations on higher revenue and lower-than-anticipated operating expenses. Net income was $21.7 million, or $0.43 a share, compared with $72.9 million, or $1.46 a share, a year earlier. Adjusted EBITDA was $133.8 million. Operating income was $62.5 million.
Vessel revenues by region were $112.1 million in Europe/Mediterranean, $77.3 million in West Africa, $48.5 million in the Middle East, $48.0 million in Asia Pacific and $54.0 million in the Americas. Vessel operating margin was $159.0 million. Crew costs were $105.2 million, repair and maintenance $29.0 million, fuel, lube and supplies $21.0 million and other vessel operating costs $22.6 million.
Operation Epic Fury began in the Middle East in the first quarter. Kneen said the company had not experienced material activity disruptions and had realized its highest utilization and day rate in recent memory in the second quarter. Costs remained somewhat elevated versus the pre-conflict structure. The company submitted a first batch of invoices for direct conflict-related costs and received modest reimbursements, and continues to expect additional reimbursements. It expects to incur about $13.1 million of conflict-related costs in 2026, of which about $7.6 million is contractually billable to customers.
Cash and cash equivalents were $613.5 million at June 30, 2026. Net cash provided by operating activities was $67.0 million in the quarter, and free cash flow was $64.4 million. Long-term debt, including the current portion, was $653.2 million.
Tidewater now expects to close the Wilson Sons Ultratug Offshore acquisition around September 1, 2026, about two months later than the end-of-second-quarter timing it had given in May. It updated 2026 revenue guidance to $1.42 billion to $1.47 billion and gross-margin guidance to 49% to 50%, pro forma for WSUT, from the $1.43 billion to $1.48 billion and 49% to 51% ranges it had reiterated in the first quarter. The revision accounts for the later WSUT close and continued elevated, though declining, Middle East operating costs. A $500 million share-repurchase authorization remains outstanding.
Kneen said customer conversations point to a broader pick-up in offshore activity through the rest of 2026 and into 2027, with tendering for new contracts picking up materially, and that the company anticipates continued leading-edge day-rate signals through the remainder of 2026.