On Tuesday, Williams Companies (NYSE:WMB) discussed first-quarter financial results during its earnings call. The full transcript is provided below.
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Summary
Williams Companies reported a 22% growth in earnings per share and a 13% increase in adjusted EBITDA to $2.25 billion for Q1 2026, reflecting strong operational execution and strategic expansion projects.
The company advanced several major projects, including the Naughton Coal conversion, Northeast and Southeast Supply Enhancement Projects, and the Aristotle Pipeline, while announcing new projects like NEO, Atlas, and Silver Spur.
Williams Companies is guiding towards the upper half of its 2026 EBITDA outlook, driven by robust demand for natural gas and expansion in power innovation projects, aiming for a 10%+ earnings CAGR through 2030.
The company is addressing future financing needs to maintain leverage within target ranges and is considering partnerships to support growth in power innovation projects.
Management emphasized continued focus on infrastructure solutions for energy challenges and advocated for permitting reform to facilitate project execution.
Full Transcript
OPERATOR
Good day everyone and welcome to the Williams Companies’ first quarter 2026 earnings conference call. Today’s conference is being recorded at this time for opening remarks and introductions. I would now like to turn the call over to Danilo Giovanni, Vice President of Investor Relations. Please go ahead.
Danilo Giovanni (Vice President of Investor Relations)
Thank you, Antoine, and good morning everyone. Thank you for joining us and for your interest in the Williams Companies. Yesterday afternoon we released our earnings press release and the presentation that our President and CEO Chad Zamrin and our Chief Financial Officer John Porter, who will speak to this morning. Also joining us on the call today are Larry Larson, our Chief Operating Officer and Rob Wengel, our Executive Vice President of Corporate Strategic Development. In our presentation materials you’ll find a disclaimer related to forward looking statements. This disclaimer is important and integral to our remarks and you should review it. Also included in the presentation materials are non-GAAP measures that we reconcile generally accepted accounting principles and these reconciliation schedules appear at the back of today’s presentation materials. So with that I’ll turn it over to Chad
Chad Zamrin (President and CEO)
Thanks Danilo and thank you all for joining us today. We’re off to a Great start. In 2026 our teams delivered another quarter of growth. We advanced our critical pipe and power projects and execution and we commercialized three new major projects and upsized a fourth first quarter. Earnings per share grew by 22% and adjusted EBITDA grew 13% to a record $2.25 billion. Our momentum continues to build, demonstrating the scalability of our strategy, the ongoing strength of our assets and the growing contribution from our expansion projects. Our teams continue to execute high return expansions at a steady pace while adding new projects to our robust backlog. And during the quarter we made consistent progress across our projects and execution. Most notably, we placed the Naughton Coal conversion project into service, a critical milestone that again demonstrates how we help customers transition to cleaner burning natural gas while maintaining affordability and grid reliability. We also kicked off construction on NESSE, the Northeast Supply Enhancement Project and CESE, the Southeast Supply Enhancement Project. Moving these large scale pipeline projects into the construction phase is a testament to our team’s ability to navigate complex permitting to deliver the infrastructure our country so desperately needs. I’m also excited to report that we have now placed on foundation all of the turbines at our Socrates Plato South location. In addition, we’ve completed construction on the first phase of the Aristotle pipeline, which will serve as a natural gas energy artery for several of our power innovation projects in Ohio, including Socrates. And we aren’t slowing down. We continue to sign new deals at attractive multiples that will drive growth through the end of the decade and beyond and help us achieve the 10 plus percent earnings CAGR we set out at analyst day. Based on the strong start to the year and our visibility into the remainder of the year, we are currently pointing toward the upper half of our full year EBITDA guidance as John will detail shortly. Looking forward, we continue to find new ways to solve the energy challenges of today, including the massive power needs of next generation data centers. Today we’re announcing three new major projects that further advance our strategy. The first project, neo, is our fifth commercialized behind the meter Power Innovation project with a high quality hyperscaler counterparty. NEO is the largest power project Williams has announced to date, consisting of 682 megawatts of installed capacity, a 12 and a half year contract and an in service date in the second half of 2028. Like our other power Innovation projects, we expect to execute NEO at an attractive five times build multiple and the project is expected to represent an investment of approximately $2.3 billion. Our second new project is Atlas, which consists of a gas infrastructure agreement to provide up to 164 million cubic feet per day of pipeline capacity to serve a large investment grade customer data center in the Northeast. This project has a 13 year term and we expect it to be in service by the end of this year. While relatively modest in capital expenditure (CapEx), Atlas demonstrates our ability to deliver an efficient natural gas solution for providing backup energy supply to existing data centers in lieu of diesel generation. Our third new project is Silver Spur, which is a significant expansion of our Northwest pipeline system and includes the installation of compression and the construction of a 90 mile transmission pipeline into the Idaho market that will add 275 million cubic feet per day of natural gas pipeline capacity. Silver Spur represents the first phase of our previously discussed Rockies Columbia connector project and is one of the first major expansions of pipeline infrastructure in the Pacific Northwest in over two decades. We are targeting an in service date of early 2030 for Silver Spur. Beyond the three new major projects, we are also announcing an upsizing of the Transco Power Express project in response to the continually growing need for natural gas to power data centers and market growth in Virginia. With the addition of a new customer and the upsizing of an existing commitment, Power Express has been increased to 750 million cubic feet per day of new Transco capacity that is scheduled to come online in 2030. And as we continue to see very strong demand for natural gas translating into new projects and a growing backlog, we are Also seeing the supply response across our footprint. In the first quarter alone, we sanctioned roughly 700 million cubic feet per day of new expansion projects across our gathering and processing portfolio. Collectively, the first quarter results further highlight our position at the intersection of incredible potential and the energy required to achieve it. By achieving another quarter of record results, we while commercializing and progressing key growth projects, the strategic direction is clear. Natural gas demand is rising, our contracted project backlog is growing and we are staying laser focused on execution and value creation. That combination will continue to drive the higher earnings and cash flow that will deliver strong long term return for our shareholders. And with that, I’ll now turn it over to John for a deeper dive into the financials.
John Porter (Chief Financial Officer)
Thanks Chad. As Chad shared, we’ve had a strong start to 2026 with record first quarter 26 EBITDA of 13% over 25, bridging from last year’s 1.99 billion to this year’s 2.25 billion. Our overall financial performance continues to be led by our transmission and Gulf businesses which improved nearly $150 million or about 17%. It was a great first quarter with growth across every business in this segment. Transco grew about 10% year-over-year, driven by higher tariff rates following last year’s rate case settlement as well as the effects of numerous expansion projects. Our Deepwater Gulf businesses grew more than 60% reflecting the combined effects of our recent Gulf expansion projects. We also saw a 35% increase from our natural gas storage business. Our Northeast GMP business grew 10 million or 2% as strong growth in the rich gas areas was offset by volume declines in certain dry gas areas. The west grew 56 million or about 16%, led by our Haynesville investments, including a full quarter of service from our Louisiana Energy Gateway pipeline. Our sequent marketing business had another strong start to the year with $227 million of adjusted EBITDA. And I’ll note that about $15 million of the overall $72 million increase per sequent was related to the Cogentrix investment acquired in March of 25. And as a reminder, we expected to best our Cogentrix investment later this year. Finally, our other segment, which includes our upstream businesses, was down about $20 million primarily due to our divestiture of the upstream Haynesville assets which closed in January of 26. And of course we’ve excluded the roughly $180 million book gain on these assets from all our recurring financial metrics. So it’s a great way to start the year with 13% adjusted EBITDA growth, which also fueled a 22% increase in our adjusted earnings per share. Now, before I hand it back over to Chad, I’ll offer a few thoughts on our full year 26 guidance. As we’ve mentioned, based on the strong start we’ve had in the first quarter, if everything else goes according to plan, we are now guiding to the upper half of our original adjusted EBITDA guidance. As a reminder, 2026 is another year where we expect seasonally lower EBITDA results in 2Q before resuming sequential growth through the second half of the year, including the partial startup of the Socrates facility beginning in the third quarter. Shifting now to capital expenditure (CapEx) leverage and our financing plans, we’re excited to add another significant power innovation project in neo. As a result, we’re increasing our growth Capex Midpoint for 26 to 7.3 billion with the addition of another power innovation project. Leverage moves modestly above our target range of 3.5 to 4 times to 4.1 times. Importantly, as we previously discussed, the balance sheet leverage tightness is primarily an issue for 26 and 27 before the historic earnings growth we expect in 2018 and beyond. In the meantime, we’re preserving multiple options to manage leverage while continuing to advance these projects and other opportunities on the horizon. As I previously discussed, those financing options include bringing in partnership and we continue to see robust interest from a broad group of potential counterparties. But we’re not locked into any single path and we have great flexibility based on timing, market conditions and cost of capital. I’d expect us to firm up our financing plans over the next couple of months. Overall, we’re very encouraged by the strength of our first quarter results, the ongoing strong execution across our project portfolio and the continued commercialization of new business, and we feel well positioned with the flexibility to fund growth. With that, I’ll turn it back to Chad.
Chad Zamrin (President and CEO)
Thanks John. I recently had the opportunity to join an incredible group of leaders, including Secretary of Interior Bergman, Secretary of Energy Wright, EPA Administrator Zeldin and FERC Chairman Sweat. As we celebrated the groundbreaking of our NESSE Project, the first new gas pipeline in New York City in over a decade, a project many thought impossible. Looking out at the crowd, which included Williams employees and union workers who will support their families and communities through their work on this project, I was reminded of the role we play in a stronger, more resilient America. Not just through pipelines and power, but through livelihoods, through the meaning and purpose of the men and women who do the essential work of delivering the energy infrastructure of America. These are the real heroes of our energy and our environment. They work every day to bring affordable energy to homes and businesses, and they work every day to preserve and advance the quality of life that we are blessed to have. And they do it while advancing sustainability and a better world for future generations. As we look forward throughout 2026 and beyond, we will continue to stay focused on smart and sustainable growth and efficient and reliable operations. We will also continue to advocate for permitting and judicial reform to help America further accelerate the infrastructure needed to increase affordability, bolster reliability, and enable economic prosperity and national energy security. Of course, none of the work and progress is possible without the investors who support Williams. Thank you for your support of our company and our team. I want to close by thanking our employees for their unwavering commitment to safely and reliably serving our customers and our nation. The Williams leadership team is incredibly proud to work with such a talented group during this exciting era of growth for our company. And with that, we’ll now open up the line for questions.
OPERATOR
Thank you. At this time, we will conduct a question and answer session. To ask a question during this session, you need to press Star 11 on your telephone and wait for your name to be announced. To withdraw your question, please press star one one. Again, we ask that you please limit yourself to one question and one follow up. Our first question comes from Jeremy Tonette from JP Morgan. Please go ahead.
Jeremy Tonette (Equity Analyst at JP Morgan)
Hi, good morning. Morning, Jeremy. Jeremy, thanks for all the color today and details on the NEO project there. I was wondering if I could dive into the power market a little bit more, if you could, any more incremental color, I guess, on the relative level of appetite that you’re seeing now versus where you were before and I guess how you think deal formation could proceed going forward here after this large deal.
Chad Zamrin (President and CEO)
Yeah. Thanks, Jeremy. And by the way, great job on your note yesterday. I love the “May the Fourth Be With You” theme. Thanks. You know, I would just say that we’ve continued to see very strong interest in our projects. You know, we’ve. I think you’ve seen, you know, the challenges that we’re going to have as a country. You know, we’ve been living the difficulty of building infrastructure on the pipeline side for some time, but we’re also seeing that clearly on the data center side. And I think our ability to bring tailored energy solutions to, you know, data center projects is, is continually being recognized as a smart solution to balance grid reliability, affordability for consumers and the need for speed for these facilities. And so, you know, you’ve seen Our backlog, we talked about it at Analyst Day. NEO represents the single largest project that we’ve announced to date. You will likely, you know, as you do the math, also see that the cost and efficiency of our projects continues to also improve. And so we continue to see robust demand. The backlog, I’d say, remains as robust, if not more so, than we discussed at Analyst Day. And yeah, I’d say we continue to expect the cadence of projects to layer in, as we’ve discussed kind of over the next several years. And so no change. If nothing else, I’d say stronger recognition that a combination of solutions, including behind the meter hybrid solutions and grid complementary solutions, are going to be required for not just the near term, but for a long time to make sure that we can meet the needs of data centers without compromising the grid or consumer affordability.
Jeremy Tonette (Equity Analyst at JP Morgan)
Got it. Thank you for that. And was just curious, I guess the industry has long talked about the need for permitting reform and the importance of gaining that to develop the needed infrastructure in the country. And as you talk to your local state senators, what do they say about the prospects for this in D.C. right now?
Chad Zamrin (President and CEO)
Yeah, look, I mean, we remain hopeful. I’ve spoken about last year the House passed a bill that had many of the provisions that we’d like to see passed into law. The Senate is working on advancing permitting reform this year. And, you know, we’re lucky to have a very strong, you know, delegation from here in Oklahoma, including Alan, who you know, was appointed recently to fill Markwayne Mullin’s seat. We will continue to advocate for meaningful permitting reform. The two primary issues that we’re going to keep focused on, there are a lot of great, I think, improvements that we can see. And the House bill had many of those. But the two primary ones are for us addressing the 401 permitting process and making sure that when you get a FERC certificate, when you’ve gone through the very robust and rigorous environmental permitting process, you have your federal permit, that a single state can’t stop a project through the 401 process. And so we haven’t asked that that not be required, but that that be a part of the federal permitting process. I think that’s pretty reasonable. And then also we as a country, not just for pipelines, we need judicial reform. And so we are advocating for any bill to have strong judicial reform so that, you know, I’ve said this before, we spent 13 years in litigation on Atlantic Sunrise. We won every lawsuit along the way. All that did was delay the project and increase the cost to the consumer. Unfortunately, that’s not unique to Atlantic Sunrise. That’s every infrastructure project in our country. It’s just too easy to tie projects up in litigation. So those are the two big ticket issues with a lot of other, I think, improvements that can be made. And we are hopeful that the Senate will act this year. And I know there’s a lot of good effort going on across the Senate, including Just recently Senator McCormick from Pennsylvania released a bill. We love the effort and the leadership on that front. We think there’s more that we should build upon. But we’re seeing a lot of good efforts from. From the Senate. We’d like to see some get passed this year.
Jeremy Tonette (Equity Analyst at JP Morgan)
Got it. Makes sense. Wishing Alan well in his endeavors.
OPERATOR
Thanks, Jeremy. Thank you. Our next question comes from Julian Dumlin Smith from Jefferies. Please go ahead.
Julian Dumlin Smith (Equity Analyst at Jefferies)
Hey, good morning, team. Nicely done yet again, bigger and better. Just if I can ask a bit more on how you think about the cadence of the 6 gigawatt backlog here first, has that been replenished here? When you think about NIO folding out of that back folding into moving forward here, how do you think about actually seeing the timeline of some of this material? As you talk about time to power, just be very curious on what you’re seeing out there. A lot of your peers talking about …
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