Williams grew Adjusted EBITDA 6% to $1.92 billion on new pipeline capacity, storage fees and Haynesville gathering; GAAP EPS jumped 51% to $0.68 mostly on asset-sale and derivative gains, while capital spending nearly doubled for power and pipeline projects.
Revenue
$3.1B
+9.8% YoY
Net income
$827M
+51.5% YoY
Diluted EPS
$0.68
+51.1% YoY
Operating margin
38.7%
How WMB compares with Energy peers
Figure
WMB
Peer median
Rank
Revenue growth (YoY)
+9.8%
+39.5%
14th of 20
Operating margin
38.7%
22.1%
5th of 18
EPS growth (YoY)
+51.1%
+47.5%
10th of 20
Rank 1 = fastest revenue growth, highest operating margin, fastest EPS growth. Peers are the other Energy companies with a 2026 report on this site, each at its latest period we've analyzed; fiscal calendars differ, so periods are not always the same months.
Pipeline fees did the work; the 51% jump in GAAP profit came mostly from one-offs
Williams is a midstream company: it doesn't drill for natural gas or sell it to households. It owns the infrastructure in between: gathering lines and processing plants near the wells, and long-distance pipelines, the biggest of which is Transco, running from Texas to New York. Williams says its system moves about a third of the country's natural gas. Most of its income comes from fees charged per unit of capacity or volume, so gas prices have less effect on it than on producers.
In the second quarter of 2026, GAAP net income (the official accounting profit) rose 51% to $827 million, or $0.68 per diluted share. That headline overstates the improvement. Roughly $213 million after tax came from items Williams excludes from its own adjusted figures: a $126 million gain on selling its stake in Brazos Permian II, a swing to gains on derivatives (the hedging contracts on commodity prices, which are marked to market value each quarter), and a small further gain on the South Mansfield upstream sale. On the measures the company and midstream investors watch most closely, growth was 6–8%: Adjusted EBITDA (earnings before interest, tax, depreciation and amortization, excluding one-offs, which approximates the cash the pipes generate) rose 6% to $1.921 billion, and adjusted EPS rose 8.7% to $0.50.
At a glance
Adjusted EBITDA $1.921 billion, up 6%. The underlying business grew at a steady mid-single-digit rate, led by new Transco and Gulf capacity, higher storage fees and Haynesville gathering.
GAAP EPS $0.68 vs adjusted EPS $0.50. About a quarter of reported earnings came from asset-sale gains and derivative gains that won't repeat. The $0.50 figure is the better guide to what the business earns.
Capital investment of $3.28 billion in the first half, nearly double last year's $1.71 billion. Williams is in a heavy building phase, especially gas-fired power plants for data-center customers, and is funding it with debt, asset sales and a new $5.34 billion Blackstone joint venture.
Metric
Q2 2026
Q2 2025
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Source: Williams Q2 2026 Form 10-Q and earnings release (Exhibit 99.1 to the Aug. 3, 2026 8-K). Adjusted EBITDA, adjusted EPS and AFFO are company-defined non-GAAP measures.
Revenue is a weak guide for Williams. It includes product sales and derivative gains and losses that swing with commodity prices, so the 9.8% revenue increase says less than the 6% rise in Adjusted EBITDA. The higher operating margin is also partly one-offs: operating income includes a $12 million asset-sale gain and a $58 million improvement in the net derivative line ($94 million gain vs $36 million).
Segment by segment: every fee-based business grew
Segment (Adjusted EBITDA)
Q2 2026
Q2 2025
Change
Transmission, Power & Gulf
$959M
$903M
+$56M (+6.2%)
Northeast G&P
$540M
$501M
+$39M (+7.8%)
West
$359M
$341M
+$18M (+5.3%)
Gas & NGL Marketing Services
−$1M
−$15M
+$14M
Other (upstream, corporate)
$64M
$78M
−$14M
Total
$1,921M
$1,808M
+$113M
Transmission, Power & Gulf (the interstate pipelines, storage, Gulf of Mexico assets and the new power business) was the largest contributor. The 10-Q lists the drivers: Gulf Coast Storage revenue rose $16 million on higher storage rates; Discovery gained $13 million from Shenandoah project volumes (in service July 2025); Transco gained $13 million from expansions, notably Commonwealth Energy Connector (November 2025); and MountainWest gained $6 million from an Overthrust compression expansion. Higher employee-related operating costs offset part of the increase. Transco's throughput barely changed (14.1 vs 14.0 MMdth/d), which is expected: pipelines are paid mainly for reserved capacity, not for the gas that actually flows.
Northeast G&P (gathering and processing in the Marcellus and Utica shale basins; "gathering and processing" means collecting gas from wells through small pipes and stripping out liquids before it enters long-haul pipelines) grew 7.8%. The company cites higher volumes at Ohio Valley Midstream and a larger share of earnings from its Blue Racer and Bradford joint ventures. Consolidated gathering volume was 4.16 Bcf/d, flat year over year, and plant inlet volume rose to 2.04 Bcf/d from 1.89.
West rose 5.3%. Louisiana Energy Gateway (LEG), the Haynesville gathering pipeline that entered service in Q3 2025, and gathering acquired with Rimrock and Saber lifted gathering volume to 6.03 Bcf/d from 5.94. Lower minimum-volume-commitment payments in the Eagle Ford partly offset the gain. Those are contract clauses that pay Williams even when producers ship less than they promised, and the Eagle Ford contracts are stepping down on schedule. West fell sequentially from $410 million in Q1, and gathering volume fell from 6.37 Bcf/d.
What the headline numbers hide
The GAAP vs adjusted gap runs the other way this quarter. GAAP net income ($827M) exceeded adjusted net income ($614M) by $213M after tax. Pre-tax, Williams removed $282M: the $126M Brazos Permian II gain, $142M of unrealized derivative gains ($120M in marketing and $22M in upstream), a $12M South Mansfield gain, and small linefill and amortization items. Segment-level "Modified EBITDA" was $2,079M before those removals, $158M above the $1,921M adjusted figure. Unrealized derivative gains and losses reverse over time. In Q1 the same line was a $192M loss in marketing, so over the first half it nets to a $72M loss.
EPS growth came from operations and one-offs, not from buybacks or taxes. Diluted shares were 1,225M vs 1,224M, so there were effectively no buybacks. The effective tax rate was 22.9% vs 23.0%. Interest expense rose 6% to $371M as debt grew. The 8.7% increase in adjusted EPS therefore reflects better operating results, net of higher interest.
Operating cash flow fell 5% even though earnings rose. Q2 cash flow from operations was $1,376M vs $1,450M. The filing attributes the decline mainly to working capital: Transco paid customer refunds in April 2026 under its FERC rate-case settlement, which became effective March 1, 2026. That is a one-time outflow. For the half year, operating cash flow of $2,979M was 1.7x net income of $1,788M, which is normal for an asset-heavy business with $1,176M of depreciation. AFFO, which excludes working-capital swings, rose 10%.
Operating cash no longer covers spending plus dividends. In the first half, capital expenditures ($3,193M) plus common dividends ($1,284M) exceeded operating cash flow by about $1.5B. Williams covered the gap with net new debt and asset sales: about $400M of sale proceeds, mainly from the South Mansfield upstream interests, plus a $48M business sale. Total debt, including commercial paper, rose to about $30.8B from $29.4B at year-end. Debt-to-Adjusted-EBITDA improved to 3.67x from 3.80x a year earlier, because EBITDA grew faster than debt. The July Blackstone joint venture brought in about $3.75B of cash after the quarter ended.
Receivables and inventory look normal. Receivables fell to $1,968M from $2,084M at year-end. Inventory rose modestly to $335M from $314M.
Marketing is volatile, not a trend. Gas & NGL Marketing earned $226M of Adjusted EBITDA in the first half, $227M of it in Q1 from what the company calls "higher gas marketing margins driven by winter storms." Q2 contributed −$1M. Weather-driven profits like these shouldn't be extrapolated.
Guidance: the increase comes from the acquisition
Williams raised its 2026 Adjusted EBITDA guidance midpoint by $200M to $8.4B (range $8.3–$8.5B). The earnings release states that the increase reflects the pending Momentum Midstream acquisition, not a better outlook for the existing business. First-half Adjusted EBITDA of $4,175M is 49.7% of the new midpoint. Growth capital guidance is $7.3–$7.9B, excluding acquisitions and certain reimbursable long-lead power equipment.
Momentum is a Haynesville (northwest Louisiana / east Texas) gathering and pipeline business with 6 Bcf/d of gathering capacity and 4.05 Bcf/d of take-or-pay pipeline capacity (customers pay for reserved space whether or not they use it). Williams will pay up to $5.5B, about $3.5B in cash and debt and about $2B in Williams stock, roughly 8.5x projected 2027 EBITDA. As of the 10-Q, the deal was expected to close later in 2026, subject to antitrust clearance. Two projects are tied to it: Delta Access, a $1.5B, 2.25 Bcf/d Transco-corridor expansion targeted for Q1 2029, and the Shelby Trough Connector, a 750 MMcf/d LEG extension targeted for Q2 2028. The roughly $2B of new shares will dilute existing holders somewhat. Williams says the deal will add to both AFFO per share and EPS.
The power-generation bet
Williams now builds and runs gas-fired power plants for large electricity users under long-term, mainly fixed-price power purchase agreements. It calls these "Power Innovation" projects, and the filing ties them to rising power demand. The first project, Socrates in New Albany, Ohio (556 MW total), placed its southern half in service in late July 2026, and Socrates North is expected in Q4 2026 under a 10-year contract. Four more projects are contracted: Apollo (490 MW, Ohio, second half 2027), Aquila (520 MW, Utah, 2H27–1H28), Socrates the Younger (340 MW, Ohio, 2H28) and Neo (682 MW, Ohio, 2H28). Contract terms run 10–12.5 years. In July, Williams sold a 49% stake in these five projects to Blackstone for $5.34B of committed capital, with about $3.75B received that month and the rest due through early 2027. Williams gets capital back early in exchange for sharing the future profits.
Takeaway: Williams' fee-based pipeline and gathering business grew Adjusted EBITDA by a steady 6%. The 51% GAAP profit increase came mostly from asset-sale and derivative gains. What matters for the next few years is that capital spending has nearly doubled, to $3.3B in six months, for pipelines and power plants that won't earn until 2027–2029. Future growth depends on delivering those projects on schedule and on budget.
What to watch next
Q3 2026 (expected early November): the first quarter with Socrates South earning revenue, and possibly the Momentum closing. The raised guidance implies second-half Adjusted EBITDA of about $4.2B at the midpoint, up roughly 7% from about $3.95B in the second half of 2025, with part of that from Momentum.
Funding: with growth capex of $7.3–$7.9B for 2026 plus the $3.5B cash-and-debt portion of Momentum, check whether leverage holds near the company's ~3.75x pro-forma target, and how much of the Blackstone capital is used to reduce debt.
Demand: the release projects Gulf Coast LNG export demand growing by about 20 Bcf/d over 10 years. This quarter's results come from projects already in service. The LNG- and power-related growth depends on projects scheduled for 2027–2029.
Our view: the core business performed as a regulated, contracted midstream company should, with no quality problems beyond the one-offs noted above. The investment case has shifted from steady pipeline growth toward execution on a much larger construction program. The main question for the next several quarters is whether the new projects start on time and whether debt stays near target while they are built.