Aug 6, 2026 earnings call — Record quarter; data center and desalination push
Reported record consolidated revenue of approximately $246 million this quarter.
Revenue $0.2B (est $0.2B) · EPS $2.23 (est $2.18)
Key quotes
"TPL generated record quarterly total revenue, net income and free cash flow."
"In addition, during the quarter, we acquired over 10,000 acres of land in Shackelford and Jones County, Texas, for approximately $100 million."
"We have completed construction and commenced commissioning on our desalination facility located in Orla, Texas, which we refer to as Phase 2b."
Analyst Q&A 3
New land buy and chip-cooling water
Q (Derrick Whitfield · Texas Capital): He asked what the Shackelford and Jones County surface acquisitions mean for project build-out and revenue streams. He also asked how strong hyperscaler and AI lab interest is for desalinated produced water for chip cooling.
A: Management said the Shackelford purchase was carefully diligenced for over a year and adds flexibility for power and compute opportunities beyond their legacy footprint. They work with a compute user and expect to replicate this approach while staying capital light. On water, interest in produced water for data centers is huge and their freeze desal technology could be used for direct chip cooling and reduce municipal water use.
"I mean it is a little bit of a step out, but I mean, we think the power and compute opportunity in West Texas is enormous and broader than just the Permian and our legacy footprint." — Tyler Glover (CEO)
Future acreage buys, royalties, oil mix
Q (Timothy Rezvan · KeyBanc): He asked whether the company will do more sizable surface acquisitions or rely on its existing nearly 1 million surface acres. He also asked whether produced water royalty per barrel should be modeled to keep rising and why oil volumes dipped in the quarter.
A: They said the primary goal is to develop existing resources but they will pursue outside opportunities too, and they are in advanced conversations on 25 gigawatts of projects and expect near-term definitive agreements. For produced water royalties, contracts have price escalators and pore space should become more valuable, though transportation royalties are typically lower so mix matters. On minerals, the lower oil percent was likely temporary due to accounting noise and gas-rich development activity, and they expect oil cuts to trend back up toward 40% plus over time.
"I would be disappointed if we don't announce at least one or more major definitive agreements in the near term." — Tyler Glover (CEO)
Buybacks, desal update, Shackelford timing
Q (Hsu-Lei Huang · Tudor, Pickering): He asked why buybacks have been minimal and whether cash is being held for bigger M&A or projects. He also asked for early takeaways on desal and how soon Shackelford/Jones projects could generate revenue.
A: They said they see many attractive opportunities and are in a cash-build mode now, though buybacks remain on the table for the future. They said belief in beneficial reuse and produced water desal has grown stronger, the facility build is done and commissioning is underway, and they are hosting a grand opening with hyperscalers and others on Monday. On Shackelford, they have been about a year into diligence, are working with Bolt and local communities on tax abatements, and expect a definitive agreement in the very near term.
"And we just continue to see a lot of great opportunities out there where we feel like we want to be kind of in that cash build mode for now." — Chris Steddum (CFO)