Tidewater Inc (NYSE:TDW) Posts Mixed Q3 2025 Results as Stock Falls on EPS Miss and 2026 Outlook

Tidewater Navigates Mixed Q3 Results as Market Weighs Outlook Against Headline Miss

Tidewater Inc (NYSE:TDW) reported financial results for the third quarter of 2025, delivering a performance that narrowly surpassed revenue expectations but fell short on the bottom line, prompting a negative reaction in after-hours trading.

Earnings and Revenue Versus Expectations

The offshore support vessel leader posted results that presented a nuanced picture for investors. While the top-line figure demonstrated resilience, the company's profitability on a per-share basis did not meet analyst forecasts.

• Q3 2025 Revenue: $341.1 million, compared to analyst estimates of approximately $337.4 million.
• Q3 2025 EPS (Non-GAAP): $0.53 per share, falling short of the estimated $0.60 per share.

The revenue beat was driven by better-than-expected vessel uptime across the global fleet, as highlighted by company leadership. However, the earnings miss appears to be influenced by several factors, including a significant loss on the early extinguishment of debt and higher general and administrative and tax expenses during the quarter. For the three-month period, the company reported a net loss attributable to Tidewater of $0.8 million, or $0.02 per common share.

Market Reaction

Following the earnings release, the market responded negatively. In after-hours trading, Tidewater's stock was down approximately 6.9%. This immediate reaction suggests investor focus may be centered on the earnings miss and the company's tempered outlook for the coming year, rather than the modest revenue outperformance. Prior to the earnings release, the stock had shown positive momentum over the past month, gaining about 10.2%.

Management Commentary and Forward Guidance

President and CEO Quintin Kneen characterized the quarter as coming in "above our expectations," crediting operational execution for the strong revenue and a gross margin of 48.0%. He noted that while average day rates softened modestly in the North Sea and West Africa, they saw meaningful increases in other regions.

Looking ahead, management provided updated and initial guidance that offers a clear view of their expectations.

• For the full year 2025, the company narrowed its revenue guidance to a range of $1.33 billion to $1.35 billion, with a margin guidance of 49% to 50%. Crucially, 99% of this revenue guidance is already covered by completed and contracted work.
• For the full year 2026, Tidewater initiated revenue guidance of $1.32 billion to $1.37 billion and margin guidance of 48% to 50%.

This 2026 revenue guidance appears to be slightly below the current analyst sales estimate of $1.355 billion for 2025, potentially contributing to the market's cautious stance as it implies a relatively flat growth trajectory in the near term.

Press Release Summary

The earnings report underscored several key operational and financial highlights beyond the headline numbers:

• Strong Cash Generation: The company reported robust cash flow, with Adjusted EBITDA of $137.9 million and free cash flow of $82.7 million for the quarter.
• Improved Utilization: Active vessel utilization increased in all but one operating segment, yielding the best active utilization rate since the second quarter of 2024.
• Debt Management: The quarter included a $27.1 million loss on the early extinguishment of debt, a strategic move that likely improves the company's future interest expense profile.
• Balance Sheet: Cash and cash equivalents grew to $428.2 million as of September 30, 2025, up from $324.9 million at the end of 2024.

Conclusion

Tidewater's third-quarter results paint a picture of a company executing well operationally, as evidenced by its revenue beat and strong cash flow. However, a miss on earnings per share and a forward outlook for 2026 that suggests a plateau has given investors pause. The market's negative after-hours reaction indicates that while the company's foundational business remains solid, concerns about near-term profit growth and the pace of the offshore drilling recovery are taking precedence. The company's ability to maintain high utilization and its substantial contracted revenue provide a floor of stability as it navigates the uncertain timing of incremental drilling projects.

For a more detailed look at Tidewater's historical earnings and future analyst estimates, you can review the data here.

Disclaimer: This article is for informational purposes only and does not constitute investment advice, financial analysis, or a recommendation to buy or sell any security. The information presented is based on publicly available data and should not be the sole basis for any investment decisions.