Tidewater Targets Revenue of Up to $1.75 Billion and a 53% Margin in 2027
Key Facts
Tidewater announced the start of issuing guidance for fiscal 2027, forecasting revenue of $1.70 billion to $1.75 billion and a margin of 51% to 53%, according to its filing with the U.S. Securities and Exchange Commission on November 10. The company is issuing the outlook as it says the offshore vessel services market is improving alongside limited supply. The CEO said expected demand includes drilling support, subsea activities, engineering, procurement and construction, as well as production support. He noted that improving market conditions and tight vessel supply had already appeared in new contract rates. The outlook gives the company its first disclosed annual range for revenue and margins in 2027.
The announcement coincided with third-quarter results, with revenue of $360.4 million, up 5.3% from the second quarter of 2026, and up from $341.1 million in the third quarter of 2025. Net income attributable to Tidewater was $17.5 million, compared with a loss of $0.8 million in the year-earlier period. The company also reported adjusted earnings before interest, taxes, depreciation and amortization of $140.1 million and free cash flow of $90.9 million. Revenue for the nine months ended September 30 rose to $1.0289 billion from $1.0160 billion in the same period of 2025. These figures provide the operating backdrop on which the company based its new guidance.
The CEO said third-quarter revenue and gross margin exceeded the company's expectations, attributing the result to strong day rates and a higher vessel utilization rate. Actual gross margin was 46.8%, exceeding the company's expectations by a full percentage point, according to its filing. That performance compares with 2027 guidance, which puts the target margin at 51% to 53%. Meanwhile, Tidewater updated its fiscal 2026 outlook to revenue of $1.43 billion to $1.44 billion and gross margin of 47.5% to 48.5%. The updated margin range includes about 140 basis points of cost burdens related to Operation Epic Fury.
Tidewater forecast costs related to the conflict in the Middle East of $19.8 million during 2026, saying $8.7 million of that amount could be charged to customers under contracts. The cost estimate forms part of the updated annual outlook, while expected revenue for the year remains in the $1.43 billion to $1.44 billion range. On capital allocation, the company has repurchased about $25 million of shares since announcing its previous results. It said $475 million remains under its buyback authorization. The filing did not directly link the repurchases to its 2027 revenue or margin guidance.
On expansion, Tidewater completed its all-cash acquisition of Wilson Sons Ultratug Offshore, known as WSUT, on August 31, 2026, in a deal that expanded its presence in Brazil. The transaction included a fleet of 22 offshore platform supply vessels. The company said it expects to have WSUT's operations almost fully integrated into the Tidewater platform by early 2027. That date marks an operational milestone ahead of the year covered by the new revenue and margin outlook. The company was scheduled to hold a conference call to discuss its third-quarter results on November 10 at 8:00 a.m. Central Time.
Tidewater shares, listed under the ticker TDW, closed at $71.06 on November 9, according to EL7 data. The close came in the session before the company disclosed its results and fiscal 2027 guidance. The filing reflects two parallel developments in the company's business: quarterly revenue growth from a year earlier and expansion of its fleet and presence through WSUT. According to management, the 2027 outlook is based on demand opportunities in drilling services, offshore activities and production support, as well as improving new contract rates in a market with limited vessel supply. Completion of the WSUT integration remains targeted for early 2027.