Second Quarter 2026
Filed Aug 13, 2026Global Water Resources Reports Second Quarter 2026 Results
Total revenue increased 24.8% year-over-year to $17.8 million, regulated revenue increased 9.9%, net income increased to $2.7 million, and adjusted EBITDA increased to $7.9 million.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenueGAAP | $ 17,767 (in thousands) | – | 24.8 % |
| Total regulated revenueGAAP | 15,656 (in thousands) | – | 9.9 % |
| Unregulated revenueGAAP | 2,111 (in thousands) | – | N/M |
| Water service revenueGAAP | $ 8,404 (in thousands) | – | 14.1 % |
| Wastewater and recycled water service revenueGAAP | 7,252 (in thousands) | – | 5.5 % |
| Net incomeGAAP | $2.7 million | – | increased $1.1 million |
| Diluted earnings per shareGAAP | $0.10 per diluted share | – | – |
| Adjusted EBITDAnon-GAAP | $7.9 million | – | increased $1.0 million YoY |
| Total operations and maintenance expenseGAAP | 4,555 (in thousands) | – | (16.3) % |
| Total general and administrative expenseGAAP | 4,305 (in thousands) | – | 1.9 % |
| Depreciation, amortization and accretionGAAP | 4,401 (in thousands) | – | (32.7) % |
| Total operating expensesGAAP | $ 13,261 (in thousands) | – | (14.1) % |
| Total active service connections at June 30, 2026other | 69,429 | – | 5.8% YoY |
| Annualized active service connection growth rate, excluding the acquisition of seven water systems from Tucson Waterother | 2.6% | – | – |
| Water consumptionother | 1.2 billion gallons | – | 6.1% YoY |
| Infrastructure projects investmentother | $6.6 million | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| Water serviceThe acquisition of the seven water systems from the City of Tucson in July 2025, organic growth in active water and wastewater connections, increased water consumption, and higher rates for GW-Farmers. | $ 8,404 (in thousands) | – | 14.1 % |
| Wastewater and recycled water serviceOrganic growth in active water and wastewater connections and increased water consumption. | 7,252 (in thousands) | – | 5.5 % |
| Unregulated revenueICFA revenue recorded in connection with the commissioning of a new wastewater reclamation facility in GW-Hassayampa’s service territory in June 2026. | 2,111 (in thousands) | – | N/M |
Capital returns
- Declared three monthly cash dividends of $0.02533 per common share or $0.30396 per common share on an annualized basis.
What drove it
- The acquisition of seven water systems from the City of Tucson in July 2025.
- Organic growth in active water and wastewater connections.
- Increased water consumption, predominantly driven by growth in active connections and higher usage largely as a result of higher temperatures and drier weather during the current year period.
- Higher rates for GW-Farmers resulting from the GW-Farmers general rate case, effective November 1, 2025 and May 1, 2026.
- Recognition of $2.1 million in unregulated revenue related to infrastructure coordination and financing agreements (ICFA).
- The company commissioned a new 60,000-gallon-per-day water reclamation facility at its Hassayampa utility.
Concerns
- Depreciation, amortization and accretion increased primarily from assets placed in service following the 2025 capital improvement plan and related investments.
- Higher utilities, chemicals and repairs were primarily the result of increased purchased power, increased consumption, and additional processing equipment in operation.
- Higher personnel costs were primarily attributable to rising medical costs.
- GW-Palo Verde withdrew its rate application and intends to refile in 2027 using a 2026 test year.
- The GW-Santa Cruz rate case, including the settlement agreement, is under advisement with the ALJ.
What to watch
- A final decision on the GW-Santa Cruz rate case is expected in the fourth quarter, with new rates for GW-Santa Cruz requested to be effective November 1, 2026.
- The settlement proposes a net $1.9 million rate increase.
- The anticipated increase to the GW-Palo Verde temporary bill credit of approximately $0.4 million annually until resolution of the next GW-Palo Verde rate case.
- The planned GW-Palo Verde and Pima County utility rate review filings in the first half of 2027 using a 2026 test year.
- The planned GW-Santa Cruz rate review filing in the first half of 2028 using a 2027 test year.
- Organic active-connection growth and water consumption trends.
Balance sheet and cash flow
- Invested $6.6 million in Q2 2026 in infrastructure projects to support existing utilities and continued growth.
- Secured an extension of the company’s $20 million revolving line of credit to May 18, 2028.
Analysis
Global Water Resources reported broad year-over-year revenue growth in the second quarter. Total revenue increased 24.8% to $17.8 million, while regulated revenue increased 9.9% to $15.7 million. Water service revenue increased 14.1% and wastewater and recycled water service revenue increased 5.5%. The result also included $2.1 million of unregulated ICFA revenue associated with a new wastewater reclamation facility in GW-Hassayampa’s service territory.
Demand indicators were favorable. Active service connections increased 5.8% year-over-year to 69,429, while the annualized growth rate excluding the Tucson Water acquisition was 2.6%. Water consumption increased 6.1% to 1.2 billion gallons. Management attributed regulated revenue growth to the Tucson acquisition, organic connection growth, greater consumption, and GW-Farmers rate increases effective November 1, 2025 and May 1, 2026.
Profitability improved despite higher infrastructure-related expense. Net income increased to $2.7 million, or $0.10 per diluted share, from $1.6 million, or $0.06 per diluted share. Adjusted EBITDA increased $1.0 million year-over-year to $7.9 million. Total general and administrative expense declined to 4,305 (in thousands) from 4,387 (in thousands), but depreciation, amortization and accretion increased to 4,401 (in thousands) from 3,317 (in thousands), reflecting assets placed in service following the 2025 capital improvement plan and related investments.
Capital allocation remained focused on system expansion and reliability, with $6.6 million invested in infrastructure projects during Q2 2026. The company maintained its dividend declaration of three monthly cash dividends of $0.02533 per common share, or $0.30396 per common share on an annualized basis, and extended its $20 million revolving line of credit to May 18, 2028. The regulatory path is central to future recovery of capital investment. The GW-Santa Cruz settlement includes an annual revenue requirement increase of approximately $2.3 million and seeks November 1, 2026 as the effective date for new rates, while management described the proposed settlement as a net $1.9 million rate increase.
No forward financial guidance was provided in the supplied filing text. Near-term attention is on the GW-Santa Cruz decision expected in the fourth quarter and the related timing of requested new rates. GW-Palo Verde’s rate application was withdrawn and will be refiled in 2027 using a 2026 test year, while the company also plans Pima County rate reviews in the first half of 2027 and a GW-Santa Cruz rate review filing in the first half of 2028.
Management, verbatim
In Q2, we generated strong year-over-year growth,
Ron Fleming, President and CEO
Importantly, second quarter general and administrative expense was slightly lower year-over-year, reflecting continued cost discipline.
Ron Fleming, President and CEO
A growing rate base from prudent infrastructure investments is expected to support future rate case filings and appropriate rate increases, helping drive revenue growth and fund current and future customer needs.
Ron Fleming, President and CEO
Not in the filing
stated, not guessed- GAAP gross profit and gross margin
- GAAP operating income
- GAAP income before income taxes
- Income tax expense and effective tax rate
- Non-GAAP earnings per share
- Adjusted EBITDA reconciliation to GAAP
- Operating cash flow
- Free cash flow
- Cash balance
- Debt balance
- Share repurchases
- Forward financial guidance
- Prior-quarter revenue, earnings, margin, cash flow, balance-sheet, and operating-metric comparisons
- Complete six-month financial results and complete financial statements, as the supplied filing text is truncated
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.