Western Midstream Partners (WES) Q1 2026 earnings summary

Executive summary

• Achieved record adjusted EBITDA of $683.1 million for Q1 2026, up 15% year-over-year and up to 7% sequentially, driven by the Aris acquisition, throughput growth, and cost reductions.

• Net income for Q1 2026 was $342.4 million, with distributable cash flow of $508.9 million.

• Announced $1.6 billion acquisition of Brazos Delaware II, expected to add $100 million incremental adjusted EBITDA in 2026 and diversify the customer base.

• Completed integration of Aris Water Solutions, expanding produced-water infrastructure and customer base.

• Increased quarterly distribution by 2.2% to $0.930 per unit, continuing a multi-year trend of distribution growth.

Financial highlights

• Total revenues for Q1 2026 were $1.12 billion, up 23% year-over-year.

• Adjusted gross margin increased to $990.7 million, up 15% year-over-year.

• Free cash flow for Q1 2026 was $242.3 million; free cash flow after distributions was negative $137.4 million.

• Capital expenditures for the quarter were $250.5 million, up year-over-year due to expansion and acquisitions.

• Ended quarter with over $2.5 billion in liquidity and a net leverage ratio near 3.1x.

Outlook and guidance

• Expect to be at the high end of 2026 adjusted EBITDA guidance ($2.5B–$2.7B) and distributable cash flow guidance ($1.85B–$2.05B), excluding Brazos impact.

• Free cash flow guidance remains $900M–$1.1B; capital expenditures expected at $850M–$1B for 2026.

• Distribution guidance of at least $3.70 per unit for 2026, with Q1 distribution at $0.93 per unit.

• Guidance will be reevaluated after the Brazos deal closes and updated based on producer activity and commodity prices.

• Produced water throughput projected to increase ~80% in 2026; natural gas throughput flat; crude oil & NGLs expected to decrease low-to-mid single digits.