Texas Pacific Land TPL Form 10-Q filing Q2 FY2026

Page No.

PART I

FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited) 1

Condensed Consolidated Balance Sheets as ofJune 30, 2026andDecember 31, 2025 1

Condensed Consolidated Statements of Income and Total Comprehensive Income for the Three and Six Months Ended#i7ac5ed2f19af400f8e1156dce3d7e3cb_466June 30, 2026and2025 2

Condensed Consolidated Statements of Cash Flows for theSix Months Ended#i7ac5ed2f19af400f8e1156dce3d7e3cb_397June 30, 2026and2025 3

Notes to Condensed Consolidated Financial Statements 4

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations 17

Item 3. Quantitative and Qualitative Disclosures About Market Risk 32

Item 4. Controls and Procedures 32

PART II

OTHER INFORMATION

Item 1. Legal Proceedings 33

Item 1A. Risk Factors 33

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 33

Item 3. Defaults Upon Senior Securities 33

Item 4. Mine Safety Disclosures 33

Item 5. Other Information 33

Item 6. Exhibits 34

Signatures 35

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (unaudited)

Item 1.Financial Statements.

See accompanying notes to condensed consolidated financial statements.

See accompanying notes to condensed consolidated financial statements.

See accompanying notes to condensed consolidated financial statements.

TEXAS PACIFIC LAND CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

1. Organization and Description of Business

Organization

Texas Pacific Land Corporation (which, together with its subsidiaries as the context requires, may be referred to as “TPL,” the “Company,” “our,” “we,” or “us”) is a Delaware corporation and one of the largest land and royalty owners in the State of Texas with approximately 894,000 surface acres of land, principally concentrated in the Permian Basin. Additionally, we own a 1/128th nonparticipating perpetual oil and gas royalty interest (“NPRI”) under approximately 85,000 acres of land, a 1/16th NPRI under approximately 371,000 acres of land, and approximately 33,000 additional net royalty acres (normalized to 1/8th) (“NRA”) for a collective total of approximately 224,000 NRA, principally concentrated in the Permian Basin.

Our revenues are derived from oil and gas royalties, water sales, produced water royalties, easements and other surface-related income and land sales.

On January 11, 2021, we completed our reorganization from a business trust, Texas Pacific Land Trust (the “Trust”), organized under a Declaration of Trust dated February 1, 1888 (the “Declaration of Trust”), into Texas Pacific Land Corporation, a corporation formed and existing under the laws of the State of Delaware (the “Corporate Reorganization”).

Basis of Presentation

The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and on the same basis as the audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2025 (“2025 Annual Report”). The condensed consolidated financial statements herein include all adjustments which are, in the opinion of management, necessary to fairly state the financial position of the Company as of June 30, 2026, the results of its operations for the three and six months ended June 30, 2026 and 2025, and its cash flows for the six months ended June 30, 2026 and 2025. Such adjustments are of a normal nature and all intercompany accounts and transactions have been eliminated in consolidation. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted from this Quarterly Report on Form 10-Q (this “Quarterly Report”), and these interim financial statements and footnotes should be read in conjunction with the audited financial statements and footnotes included in our 2025 Annual Report. The results for the interim periods shown in this Quarterly Report are not necessarily indicative of future financial results.

Operating segments are based on components of the Company that engage in business activity that earn revenues and incur expenses and (a) whose operating results are regularly reviewed by our chief operating decision maker (“CODM”) to make decisions about resource allocation and performance and (b) for which discrete financial information is available. The Company operates two operating segments which represent our reportable segments: Land and Resource Management and Water Services and Operations. The segments enable the alignment of our strategies and objectives and provide a framework for timely and rational allocation of resources within our businesses. The measure of profit or loss that the CODM uses to assess performance and allocate resources to our reportable segments is net income. Our chief executive officer is the CODM and uses net income to evaluate income generated by each segment in his determination of allocating resources to each segment. See Note 14, “Business Segment Reporting” for further information regarding our segments.

On December 22, 2025, we effected a three-for-one forward stock split of our common stock, par value $0.01 per share (“Common Stock”). The record date for the stock split was December 12, 2025. The shares of Common Stock retained a par value of $0.01 per share. Accordingly, an amount equal to the par value of the increased shares resulting from the stock split was reclassified from “Additional paid-in capital” to “Common Stock.”

Unless the context otherwise requires, all share and per share information (including information regarding treasury shares, restricted stock awards (“RSAs”), restricted stock units (“RSUs”), and performance stock units (“PSUs”)) have been retroactively adjusted to reflect the stock split.

2. Summary of Significant Accounting Policies

Use of Estimates in the Preparation of Financial Statements

The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. In the event estimates and/or assumptions prove to be different from actual amounts, adjustments are made in subsequent periods to reflect more current information.

Cash, Cash Equivalents and Restricted Cash

We consider investments in bank deposits, money market funds, and other highly-liquid cash investments, such as U.S. Treasury bills and commercial paper, with original maturities of three months or less to be cash equivalents. Our cash equivalents are considered Level 1 assets in the fair value hierarchy.

The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the condensed consolidated balance sheets that correspond to the same such amounts shown in the condensed consolidated statements of cash flows (in thousands):

Financing Receivable, Net

We may enter into land sale transactions that include either explicit or implied seller financing arrangements. In such transactions, the land sale is recognized upon completion of the performance obligation which we consider to be when control of the land transfers to the buyer. As the contract price is collected over time, a net financing receivable is recorded at the date of sale for the difference between the contract price and the land sale revenue recognized, which represents the total contract consideration discounted for the time value of money imputed at a market-based rate of return. The carrying value of our financing receivable approximates its fair value and is classified as Level 3 within the fair value hierarchy.

Financing receivables are subsequently measured at amortized cost, with the difference between the contractual payments and the initial carrying value recognized as interest income over the term of the arrangement using the effective interest method. Interest income is included in other income, net in the condensed consolidated statements of income.

We evaluate our financing receivable for expected credit losses based on the credit quality of the counterparty, the underlying collateral, and other relevant factors. As of June 30, 2026, no allowance for expected credit losses was recorded.

3. Oil and Gas Royalty Interests

As of June 30, 2026 and December 31, 2025, the net book value of the oil and gas royalty interests we owned was as follows (in thousands):

(1)Royalty interests assigned through the Declaration of Trust. Nonparticipating perpetual royalty interests in 185,369 NRA as of June 30, 2026 and December 31, 2025.

(2)Royalty interests assigned through the Declaration of Trust. Nonparticipating perpetual royalty interests in 5,308 NRA as of June 30, 2026 and December 31, 2025.

(3)Royalty interest in 33,380 NRA as of June 30, 2026 and December 31, 2025.

There were no acquisitions of oil and gas royalty interests during the six months ended June 30, 2026. During the six months ended June 30, 2025, we acquired oil and gas royalty interests for a purchase price of approximately $3.5 million, net of post-closing adjustments. In addition, during the six months ended June 30, 2025, we received a $3.9 million post-closing adjustment from the seller related to curative title defects for a prior year acquisition. There were no sales of oil and gas royalty interests during the six months ended June 30, 2026 or 2025.

Depletion expense was $11.1 million and $8.7 million for the three months ended June 30, 2026 and 2025, respectively. Depletion expense was $19.7 million and $16.0 million for the six months ended June 30, 2026 and 2025, respectively.

4. Real Estate Activity

As of June 30, 2026 and December 31, 2025, we owned the following land and real estate (in thousands, except number of acres):

(1) Real estate assigned through the Declaration of Trust.

Land Acquisitions

During the six months ended June 30, 2026, we acquired land for an aggregate purchase price of $110.2 million. The acquisitions included land in Shackelford and Jones Counties, Texas, in connection with our data center and power generation initiatives. Additionally, we acquired land in Winkler County, Texas. During the six months ended June 30, 2025, we acquired land for an aggregate purchase price of $4.5 million.

Land Sales

During the six months ended June 30, 2026, we entered into an agreement with Chevron U.S.A. Inc., a subsidiary of Chevron Corporation (NYSE: CVX) (“Chevron”) to provide land and brackish water resources for Chevron’s recently announced development known as Project Kilby, involving a large-scale power generation facility Chevron is developing to support a customer data center in Reeves County, Texas. As part of the agreement, we sold land for aggregate consideration of $42.5 million and acquired the exclusive right to source aquifer-derived water for the power generation facility and other associated aspects of the project. The consideration consisted of a nominal cash payment received at closing and annual payments due to us through 2046.

This agreement also provides for a put option held by the developer and a call option held by us regarding our repurchase of the land if certain development milestones are not achieved.

We recognized land sales revenue of $20.9 million at closing and recorded a financing receivable for the deferred consideration. The financing receivable was recorded at its present value of $20.9 million, which represents the contractual payments of $42.4 million discounted at an effective interest rate of 7.5%.

As of June 30, 2026, the carrying value of the financing receivable was $21.4 million, of which $1.0 million is included in current assets on the condensed consolidated balance sheets. Interest income recognized on the financing receivable was $0.4 million and $0.5 million for the three and six months ended June 30, 2026, respectively.

There were no land sales for the six months ended June 30, 2025.

5. Property, Plant and Equipment

Property, plant and equipment, net consisted of the following as of June 30, 2026 and December 31, 2025 (in thousands):

Depreciation expense was $4.8 million and $4.3 million for the three months ended June 30, 2026 and 2025, respectively. Depreciation expense was $9.5 million and $8.3 million for the six months ended June 30, 2026 and 2025, respectively.

6. Intangible Assets

Intangible assets, net consisted of the following as of June 30, 2026 and December 31, 2025 (in thousands):

(1) The remaining weighted average amortization period for total intangible assets was 8.9 years as of June 30, 2026.

Amortization of intangible assets was $0.6 million for both of the three months ended June 30, 2026 and 2025. Amortization of intangible assets was $1.2 million for both of the six months ended June 30, 2026 and 2025. The estimated future amortization expense of intangible assets for each of the next five years and thereafter is as follows (in thousands):

7. Credit Facility

On October 23, 2025, the Company entered into a revolving credit agreement (the “Credit Facility”) providing for total commitments of $500.0 million, with the ability, subject to lender approval, to increase total commitments by up to $250.0 million, in minimum increments of $50.0 million. The Credit Facility matures on October 23, 2029. The facility remains undrawn as of June 30, 2026.

Borrowings under the Credit Facility bear interest at variable rates based on the Company’s consolidated total leverage ratio, using a base rate or SOFR-based rate plus an applicable margin. The Company also pays commitment fees on the unused portion of the Credit Facility and customary letter of credit fees.

The Credit Facility is unsecured; however, it becomes subject to a springing security interest on substantially all equity securities of the Company’s subsidiaries if the Company’s consolidated total leverage ratio exceeds 2.50 to 1.0. The Credit Facility contains customary financial and other covenants and other customary provisions. As of June 30, 2026, the Company was in compliance with all covenants under the Credit Facility.

As of June 30, 2026, unamortized debt issuance costs related to the Credit Facility were $4.2 million. For the three months ended June 30, 2026, interest expense related to the Credit Facility was $1.0 million, including $0.3 million of amortization of debt issuance costs. For the six months ended June 30, 2026, interest expense related to the Credit Facility was $2.0 million, including $0.6 million of amortization of debt issuance costs.

8. Share-Based Compensation

The Company grants share-based compensation to employees under the Texas Pacific Land Corporation 2021 Incentive Plan (the “2021 Plan”) and to its non-employee directors under the Texas Pacific Land Corporation 2021 Non-Employee Director Stock and Deferred Compensation Plan (the “2021 Directors Plan” and, together with the 2021 Plan, the “Plans”). As of June 30, 2026, share-based compensation granted under the Plans included RSAs, RSUs and PSUs. RSUs granted under the 2021 Plan vest in one-third annual increments over three years, and PSUs granted under the 2021 Plan cliff vest at the end of three years if the applicable performance metrics are achieved (as discussed further below). RSAs granted under the 2021 Directors Plan vest in full on the date of grant.

Incentive Plan for Employees

The maximum aggregate number of shares of Common Stock that may be issued under the 2021 Plan is 675,000 shares, which may consist, in whole or in part, of authorized and unissued shares (if any), treasury shares, or shares reacquired by the Company in any manner. As of June 30, 2026, 320,816 shares of Common Stock remained available under the 2021 Plan for future grants.

The following table summarizes activity related to RSUs granted under the 2021 Plan for the six months ended June 30, 2026:

(1) RSUs vest in one-third annual increments over a three-year period.

(2) Of the 27,075 RSUs that vested during the six months ended June 30, 2026, 10,633 RSUs were surrendered by employees to the Company upon vesting to settle tax withholding obligations.

The following table summarizes activity related to PSUs granted under the 2021 Plan for the six months ended June 30, 2026:

(1) The PSUs were granted on February 15, 2026 and include 6,936 RTSR PSUs (defined below) (based on target) with a grant date fair value of $681 per share and 6,936 FCF PSUs (defined below) (based on target) with a grant date fair value of $432 per share. If the maximum performance levels described in the PSU agreements are achieved, the actual number of shares that will ultimately vest under the PSU agreements will exceed target PSUs by 100% (i.e., an aggregate of 13,872 additional shares would be issued).

(2) Vested PSUs are based on the original number of PSUs granted (i.e., target units). The actual number of shares delivered upon vesting of PSUs during the six months ended June 30, 2026 totaled 27,925 shares, of which 11,492 shares were surrendered by employees to the Company upon vesting to settle tax withholding obligations.

Each PSU has a value equal to one share of Common Stock. The PSUs will vest three years after grant if certain performance metrics are met, as follows: 50% of the PSUs may be earned based on the Company’s relative total stockholder return (“RTSR”) over the applicable three-year measurement period compared to the SPDR® S&P® Oil & Gas Exploration & Production ETF (“XOP Index”), and 50% of the PSUs may be earned based on the cumulative free cash flow per share (“FCF”) over the three-year vesting period. Because the RTSR PSUs are market-based awards, their grant date fair value was determined using a Monte Carlo simulation model that uses the same input assumptions as the Black-Scholes model to determine the expected potential ranking of the Company against the XOP Index (i.e., the probability of satisfying the market condition defined in the awards). Expected volatility in the model was estimated based on the volatility of historical stock prices over a period matching the expected term of the awards. The risk-free interest rate was based on U.S. Treasury yield constant maturities for a term matching the expected term of the awards. The inputs for the Monte Carlo simulation model are designated as Level 2 within the fair value hierarchy.

Equity Plan for Non-Employee Directors

The maximum aggregate number of shares of Common Stock that may be issued under the 2021 Directors Plan is 90,000 shares, which may consist, in whole or in part, of authorized and unissued shares, treasury shares, or shares reacquired by the Company in any manner. As of June 30, 2026, 64,407 shares of Common Stock remained available under the 2021 Directors Plan for future grants.

The following table summarizes activity related to the RSAs under the 2021 Directors Plan for the six months ended June 30, 2026:

(1) RSAs vest in full on the date of grant.

(2) Of the 4,686 RSAs that were granted during the six months ended June 30, 2026, 1,108 RSAs were deferred at the election of certain directors pursuant to the 2021 Directors Plan until the year following the director’s termination as a director.

Share-Based Compensation Expense

The following table summarizes our share-based compensation expense by line item in the condensed consolidated statements of income (in thousands):

(1) The Company recognized a tax benefit of $0.9 million and $0.7 million related to share-based compensation for the three months ended June 30, 2026 and 2025, respectively. The Company recognized a tax benefit of $2.0 million and $1.7 million related to share-based compensation for the six months ended June 30, 2026 and 2025, respectively.

As of June 30, 2026, there was $22.9 million of total unrecognized compensation cost related to unvested share-based compensation arrangements granted under existing share-based plans expected to be recognized over a weighted average period of 1.3 years.

9. Other Income, Net

Other income, net for the three and six months ended June 30, 2026 and 2025 was as follows (in thousands):

10. Income Taxes

The calculation of our effective tax rate was as follows for the three and six months ended June 30, 2026 and 2025 (in thousands, except percentages):

During the three months ended June 30, 2026, we executed an agreement with an eligible taxpayer to purchase up to $60.0 million of transferrable federal tax credits for $55.8 million, resulting in an estimated tax benefit of $4.2 million. The estimated tax benefit recognized for the three and six months ended June 30, 2026, was included in our estimated annual effective tax rate and reduced income tax expense during the period.

For interim periods, our income tax expense and resulting effective tax rate are based upon an estimated annual effective tax rate adjusted for the effects of items required to be treated as discrete to the period, including changes in tax laws, changes in estimated exposures for uncertain tax positions, and other items.

11. Earnings Per Share

Basic earnings per share (“EPS”) is computed based on the weighted average number of shares outstanding during the period. Diluted EPS is computed based upon the weighted average number of shares outstanding during the period plus unvested RSAs and other nonvested awards granted pursuant to our incentive and equity compensation plans. The computation of diluted EPS reflects the potential dilution that could occur if all outstanding awards under the incentive and equity compensation plans were converted into shares of Common Stock or resulted in the issuance of shares of Common Stock that would then share in the earnings of the Company. The number of dilutive securities is computed using the treasury stock method.

The following table sets forth the computation of basic and diluted EPS for the three and six months ended June 30, 2026 and 2025 (in thousands, except number of shares and per share data):

Restricted stock, if any, is included in the number of shares of Common Stock issued and outstanding but omitted from the basic EPS calculation until the shares of restricted stock vest. Certain stock awards granted are not included in the dilutive securities in the table above as they were anti-dilutive for the three and six months ended June 30, 2026 and 2025.

12. Commitments and Contingencies

Litigation

Management is not aware of any legal, environmental or other commitments or contingencies that would have a material effect on the Company’s financial condition, results of operations or liquidity as of June 30, 2026, other than as described below.

Prior to January 1, 2022, ad valorem taxes with respect to our historical royalty interests were paid directly by third parties pursuant to an existing arrangement. After the completion of our Corporate Reorganization, we received notice from a third party that it no longer intended to pay the ad valorem taxes related to such historical royalty interests. In order to protect the historical royalty interests from any potential tax liens for non-payment of ad valorem taxes, we have accrued and/or paid such ad valorem taxes since January 1, 2022. While we intend to seek reimbursement from the third party for such taxes, we are unable to estimate the amount and/or likelihood of such reimbursement, and accordingly, no loss recovery receivable has been recorded as of June 30, 2026.

Lease Commitments

As of June 30, 2026 and December 31, 2025, we had right-of-use assets of $13.1 million and $13.7 million, respectively, and lease liabilities of $18.0 million and $17.8 million, respectively, primarily related to operating leases in connection with our administrative offices located in Dallas and Midland, Texas. The leases for our Dallas and Midland offices expire in May 2036 and July 2027, respectively. The office lease agreements require monthly rent payments, and operating lease expense is recognized on a straight-line basis over the lease term. Operating lease costs were $0.6 million and $1.1 million for the three and six months ended June 30, 2026, respectively. Operating lease costs were $0.2 million and $0.4 million for the three and six months ended June 30, 2025, respectively.

The weighted-average lease term for our operating lease liabilities is approximately 9.8 years. The weighted average discount rate of our operating leases is 6.6%.

Future minimum lease payments are as follows (in thousands):

13. Changes in Equity

The following tables present changes in our equity for the six months ended June 30, 2026 and 2025 (in thousands, except shares and per share amounts):

Stock Repurchase Program

On November 1, 2022, our board of directors (the “Board”) approved a stock repurchase program, which became effective January 1, 2023, to purchase up to an aggregate of $250.0 million of our outstanding Common Stock. The Company opportunistically repurchases stock under the stock repurchase program with funds generated by cash from operations. The stock repurchase program may be suspended from time to time, modified, extended or discontinued by the Board at any time. Purchases under the stock repurchase program may be made through a combination of open market repurchases in compliance with Rule 10b-18 promulgated under the Securities Exchange Act of 1934, as amended, privately negotiated transactions, and/or other transactions at the Company’s discretion, including under a Rule 10b5-1 trading plan implemented by the Company, and are subject to market conditions, applicable legal requirements and other factors. As of June 30, 2026, the remaining amount authorized under the approved stock repurchase program was $170.2 million.

14. Business Segment Reporting

During the periods presented, we reported our financial performance based on the following reportable segments: Land and Resource Management and Water Services and Operations. We eliminate inter-segment revenues and expenses, if any, upon consolidation. There were no inter-segment revenues for the three and six months ended June 30, 2026 and 2025.

The Land and Resource Management segment encompasses the business of managing our approximately 894,000 surface acres of land and our approximately 224,000 NRA of oil and gas royalty interests, principally concentrated in the Permian Basin. The revenue streams of this segment consist primarily of royalties from oil and gas, revenues from easements and commercial leases, and land and material sales.

The Water Services and Operations segment encompasses the business of providing a full-service water offering to operators in the Permian Basin. The revenue streams of this segment primarily consist of revenue generated from sales of sourced and treated water as well as revenue from produced water royalties.

The following tables present segment financial results for Land and Resource Management (“LRM”) and Water Services and Operations (“WSO”) and the reconciliation to consolidated financial results for the three and six months ended June 30, 2026 and 2025 (in thousands):

Interest income by segment is included in other income, net in the tables above.

The following tables present purchases of fixed assets, total assets and property, plant and equipment, net by segment for the periods presented (in thousands):

15. Oil and Gas Producing Activities

Our Share of Oil and Gas Produced

We measure our share of oil and gas produced in barrels of oil equivalent (“Boe”). One Boe equals one barrel of crude oil, condensate, natural gas liquids (“NGL”) or approximately 6,000 cubic feet of gas. For the three months ended June 30, 2026 and 2025, our share of oil and gas produced was approximately 39.7 thousand and 33.2 thousand Boe per day, respectively. For the six months ended June 30, 2026 and 2025, our share of oil and gas produced was approximately 38.4 thousand and 32.2 thousand Boe per day, respectively.

Capitalized Oil and Gas Costs

Aggregate capitalized costs related to oil and gas production activities with applicable accumulated depletion are as follows (in thousands):

The Company owns approximately 224,000 NRA as of June 30, 2026. Of our total NRA, approximately 191,000 was acquired in 1888 and was recorded with no value. The remaining approximately 33,000 NRA have been acquired over recent years and are included in royalty interests acquired on the condensed consolidated balance sheets. See additional discussion in Note 3, “Oil and Gas Royalty Interests.”

16. Subsequent Events

We evaluated events that occurred after the balance sheet date through the date these financial statements were issued, and the following events that met recognition or disclosure criteria were identified:

Dividends Declared

On August 4, 2026, our Board declared a quarterly cash dividend of $0.60 per share, payable on September 15, 2026 to stockholders of record at the close of business on September 1, 2026.

Item 2. s Discussion and Analysis of Financial Condition and Results of Operations

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

Results of Operations

The following tables show our consolidated results of operations and our results of operations by reportable segment for Land and Resource Management (“LRM”) and Water Services and Operations (“WSO”) for the three and six months ended June 30, 2026 and 2025 (in thousands):

Interest income by segment is included in other income, net in the table above.

Consolidated Results of Operations

For the Three Months Ended June 30, 2026 as Compared to the Three Months Ended June 30, 2025

Total revenues were $246.1 million for the three months ended June 30, 2026 compared to $187.5 million for the three months ended June 30, 2025. Total operating expenses were $54.2 million for the three months ended June 30, 2026 compared to $43.8 million for the three months ended June 30, 2025. Net income was $153.9 million for the three months ended June 30, 2026 compared to $116.1 million for the three months ended June 30, 2025. Individual revenue and expense line items are discussed below under “Segment Results of Operations.”

For the Six Months Ended June 30, 2026 as Compared to the Six Months Ended June 30, 2025

Total revenues were $482.9 million for the six months ended June 30, 2026 compared to $383.5 million for the six months ended June 30, 2025. Total operating expenses were $108.7 million for the six months ended June 30, 2026 compared to $89.7 million for the six months ended June 30, 2025. Net income was $296.8 million for the six months ended June 30, 2026 compared to $236.8 million for the six months ended June 30, 2025. Individual revenue and expense line items are discussed below under “Segment Results of Operations.”

Segment Results of Operations

We operate our business in two reportable segments: Land and Resource Management and Water Services and Operations. We eliminate any inter-segment revenues and expenses, if any, upon consolidation.

We evaluate the performance of our operating segments separately to monitor the different factors affecting financial results. The reportable segments presented are consistent with our reportable segments discussed in Note 14, “Business Segment Reporting” in the notes to the condensed consolidated financial statements in this Quarterly Report. We monitor our

reporting segments based upon net income calculated in accordance with accounting principles generally accepted in the United States of America (“GAAP”).

As discussed in “Market Conditions” and “Permian Basin Activity” above, our segment revenues are directly influenced by development decisions made by our customers, the overall activity level in the Permian Basin and commodity prices. Accordingly, our segment revenues, sales volumes and associated expenses, as further discussed below, fluctuate from period to period based upon those decisions, activity levels and commodity prices.

For the Three Months Ended June 30, 2026 as Compared to the Three Months Ended June 30, 2025

Land and Resource Management

Oil and gas royalties. Oil and gas royalty revenue was $145.6 million for the three months ended June 30, 2026 compared to $95.0 million for the three months ended June 30, 2025, an increase of 53.2%. The average realized price increased 28.0% to $42.17 per barrel of oil equivalent (“Boe”) for the three months ended June 30, 2026 from $32.94 per Boe for the three months ended June 30, 2025. Our share of production increased to 39.7 thousand Boe per day for the three months ended June 30, 2026 compared to 33.2 thousand Boe per day for the same period of 2025.

The financial and operational data by royalty stream is presented in the table below for the three months ended June 30, 2026 and 2025:

(1) Commonly used definitions in the oil and gas industry: “Bbl” represents one barrel of 42 U.S. gallons of crude oil, condensate or NGLs. “Boe” represents barrels of oil equivalent. “NGL” represents natural gas liquid. “MBbls” represents one thousand barrels of crude oil, condensate or NGLs. “Mcf” represents one thousand cubic feet of natural gas. “MMcf” represents one million cubic feet of natural gas. “MBoe” represents one thousand Boe. “MBoe/d” represents one thousand Boe per day.

Easements and other surface-related income. Easements and other surface-related income was $18.3 million for the three months ended June 30, 2026, compared to $33.5 million for the three months ended June 30, 2025. Easements and other surface-related income includes revenue related to the use and crossing of our land for oil and gas E&P, renewable energy, and agricultural operations. The decrease in easements and other surface-related income was principally related to a decrease of $15.0 million in pipeline easements for the three months ended June 30, 2026 compared to the same period of 2025. The amount of income derived from pipeline easements is a function of the term of the easement, the size of the easement, and the

number of easements entered into for any given period. Easements and other surface-related income is dependent on development decisions made by companies that operate in the areas where we own land and is, therefore, unpredictable and may vary significantly from period to period. See “Market Conditions” and “Permian Basin Activity” above for additional discussion of development activity in the Permian Basin during the three months ended June 30, 2026.

Salaries and related employee expenses. Salaries and related employee expenses, which include not only salaries, equity and non-equity incentive compensation, but also employee benefits and contract labor expense, were $8.3 million for the three months ended June 30, 2026 compared to $7.0 million for the same period of 2025. The increase in salaries and related employee expenses was principally related to market compensation adjustments that take effect annually at the start of a given year and an increase in company headcount compared to the same period of 2025.

General and administrative expenses. General and administrative expenses were $5.2 million for the three months ended June 30, 2026 compared to $3.6 million for the comparable period of 2025. The increase in general and administrative expenses was primarily due to an increase in rent and office-related expenses of $0.6 million compared to the same period of 2025.

Depreciation, depletion and amortization. Depreciation, depletion and amortization was $11.7 million for the three months ended June 30, 2026 compared to $9.1 million for the comparable period of 2025. The increase in depreciation, depletion and amortization was principally due to depletion expense associated with royalty interests acquired during the second half of 2025.

Interest expense. Interest expense was $0.8 million for the three months ended June 30, 2026 related to the Credit Facility entered into during the fourth quarter of 2025. There was no interest expense incurred during the three months ended June 30, 2025.

Other income, net. Other income, net was $2.1 million for the three months ended June 30, 2026 compared to $4.2 million for the same period of 2025. Lower cash balances and investment yields during the three months ended June 30, 2026 compared to the same period of 2025 resulted in a decrease in interest income.

Income tax expense. Income tax expense was $28.2 million for the three months ended June 30, 2026 compared to $24.4 million for the comparable period of 2025. The increase in income tax expense is primarily attributable to the increase in operating income for the three months ended June 30, 2026 compared to the same period of 2025, and, to a lesser extent, was partially offset by a lower effective tax rate due to the tax benefit from transferable federal income tax credits purchased during the current period. See “Liquidity and Capital Resources” above for additional discussion.

Water Services and Operations

Water sales. Water sales revenue increased $14.2 million to $39.7 million for the three months ended June 30, 2026, compared to $25.6 million for the same period of 2025. The increase in water sales was principally due to an increase of 37.5% in water sales volumes and 13.0% in average realized pricing for the three months ended June 30, 2026, compared to the same period of 2025. Water sales volumes are dependent upon customer demand in the areas in which we provide water to customers and may fluctuate from period to period.

Produced water royalties. Produced water royalties are received from the transfer or disposal of produced water on our land and are contractual and not paid as a matter of right. Produced water royalties are also fee based and not directly impacted by lower commodity prices. However, indirectly, volumes may vary from period to period depending upon development activity levels and operator decisions involving recycling versus disposal of produced water. We do not operate any saltwater disposal wells. Produced water royalties increased to $37.1 million for the three months ended June 30, 2026 compared to $30.7 million for the same period in 2025. This increase was principally due to a 14.7% increase in produced water volumes for the three months ended June 30, 2026 compared to the same period of 2025.

The table below provides financial and operational data by water revenue type for the three months ended June 30, 2026 and 2025:

(1) MBbl = 1 thousand barrels of water.

(2) MBbl/d = 1 thousand barrels of water per day.

Easements and other surface-related income. Easements and other surface-related income was $5.4 million for the three months ended June 30, 2026, an increase of $2.7 million compared to $2.7 million for the three months ended June 30, 2025. Easements and other surface-related income is dependent on development decisions made by companies that operate in the areas where we own land and may also be affected by volumes and commodity prices associated with royalties on certain hydrocarbons recovered in connection with produced water disposal activities. As a result, this income is unpredictable and may vary significantly from period to period.

Water service-related expenses. Water service-related expenses increased $3.1 million to $11.6 million for the three months ended June 30, 2026 compared to the same period of 2025. Certain types of water-related expenses, including, but not limited to, treatment, transfer, water purchases, repairs and maintenance, equipment rental, and fuel costs, vary from period to period as our customers’ needs and requirements change. Right of way and other expenses also vary from period to period depending upon location of customer delivery. The increase in water service-related expenses for the three months ended June 30, 2026 compared to the same period of 2025 was principally related to a 37.5% increase in water sales volumes.

Income tax expense. Income tax expense was $11.5 million for the three months ended June 30, 2026 compared to $8.4 million for the same period of 2025. The increase in income tax expense was primarily attributable to the increase in operating income for the three months ended June 30, 2026 compared to the same period of 2025, and to a lesser extent, was partially offset by a lower effective tax rate due to the tax benefit from transferable federal income tax credits purchased during the current period. See “Liquidity and Capital Resources” above for additional discussion.

For the Six Months Ended June 30, 2026 as Compared to the Six Months Ended June 30, 2025

Land and Resource Management

Oil and gas royalties. Oil and gas royalty revenue was $263.8 million for the six months ended June 30, 2026 compared to $206.3 million for the six months ended June 30, 2025, an increase of $57.5 million. Our share of production increased to 38.4 thousand Boe per day for the six months ended June 30, 2026 compared to 32.2 thousand Boe per day for the same period of 2025. The average realized price increased 7.1% to $39.72 per Boe for the six months ended June 30, 2026 from $37.10 per Boe for the same period of 2025.

The financial and operational data by royalty stream is presented in the table below for the six months ended June 30, 2026 and 2025:

Easements and other surface-related income. Easements and other surface-related income was $32.7 million for the six months ended June 30, 2026, a decrease of $16.1 million compared to $48.8 million for the six months ended June 30, 2025. Easements and other surface-related income includes revenue related to the use and crossing of our land for oil and gas E&P, renewable energy, and agricultural operations. The decrease in easements and other surface-related income was principally related to decreases of $14.7 million in pipeline easements and $2.0 million in material sales, partially offset by a $3.2 million increase in lease bonuses associated with acquired royalty interests, for the six months ended June 30, 2026 compared to the same period of 2025. The amount of income derived from pipeline easements is a function of the term of the easement, the size of the easement, and the number of easements entered into for any given period. Easements and other surface-related income is dependent on development decisions made by companies that operate in the areas where we own land and is, therefore, unpredictable and may vary significantly from period to period. See “Market Conditions” and “Permian Basin Activity” above for additional discussion of development activity in the Permian Basin during the six months ended June 30, 2026.

Land sales. Land sales revenue was $20.9 million during the six months ended June 30, 2026 relating to the sale of land as discussed in Note 4, “Real Estate Activity” in the notes to the condensed consolidated financial statements in this Quarterly Report. There was no land sales revenue for the comparable period of 2025.

Salaries and related employee expenses. Salaries and related employee expenses, which include not only salaries, equity and non-equity incentive compensation, but also employee benefits and contract labor expense, were $15.9 million for the six months ended June 30, 2026 compared to $14.4 million for the same period of 2025. The increase in salaries and related employee expenses was principally related to market compensation adjustments that take effect annually at the start of a given year and an increase in company headcount compared to the same period of 2025.

General and administrative expenses. General and administrative expenses were $10.7 million for the six months ended June 30, 2026 compared to $7.0 million for the comparable period of 2025. The increase was principally related to increases in rent and office-related expenses of $1.1 million and legal and professional fees of $1.0 million over the same time period.

Depreciation, depletion and amortization. Depreciation, depletion and amortization was $20.9 million for the six months ended June 30, 2026 compared to $16.8 million for the comparable period of 2025. The increase was principally due to depletion expense associated with royalty interests acquired during the second half of 2025.

Other income, net. Other income, net was $3.7 million for the six months ended June 30, 2026 compared to $7.6 million for the same period of 2025. Lower cash balances and investment yields during the six months ended June 30, 2026 compared to the same period of 2025 resulted in a decrease in interest income.

Income tax expense. Income tax expense was $56.9 million for the six months ended June 30, 2026 compared to $48.3 million for the comparable period of 2025. The increase in income tax expense is directly attributable to the increase in operating income for the six months ended June 30, 2026 compared to the same period of 2025, and, to a lesser extent, was partially offset by a lower effective tax rate due to the tax benefit from transferable federal income tax credits purchased during the current period. See “Liquidity and Capital Resources” above for additional discussion.

Water Services and Operations

Water sales. Water sales revenue increased $22.2 million to $86.6 million for the six months ended June 30, 2026 compared to the same period of 2025. The increase in water sales was principally due to increases of 16.4% in water sales volumes and 15.5% in average realized pricing for the six months ended June 30, 2026 compared to the same period of 2025. Water sales volumes are dependent upon customer demand in the areas in which we provide water to customers and may fluctuate from period to period.

Produced water royalties. Produced water royalties are royalties received from the transfer or disposal of produced water on our land and are contractual and not paid as a matter of right. Produced water royalties are also fee based and not directly impacted by lower commodity prices. However, indirectly, volumes may vary from period to period depending upon development activity levels and operator decisions involving recycling versus disposal of produced water. We do not operate any saltwater disposal wells. Produced water royalties increased to $70.6 million for the six months ended June 30, 2026 compared to $58.4 million for the comparable period of 2025. The increase in produced water royalties was principally due to the 18.8% increase in produced water volumes for the six months ended June 30, 2026 compared to the same period of 2025.

Easements and other surface-related income. Easements and other surface-related income was $8.3 million for the six months ended June 30, 2026, an increase of $2.7 million compared to $5.6 million for the six months ended June 30, 2025. Easements and other surface-related income is dependent on development decisions made by companies that operate in the areas where we own land and may also be affected by volumes and commodity prices associated with royalties on certain hydrocarbons recovered in connection with produced water disposal activities. As a result, this income is unpredictable and may vary significantly from period to period.

Water service-related expenses. Water service-related expenses increased $6.3 million to $25.9 million for the six months ended June 30, 2026 compared to the same period of 2025. Certain types of water-related expenses, including, but not

limited to, treatment, transfer, water purchases, repairs and maintenance, equipment rental, and fuel costs, vary from period to period as our customers’ needs and requirements change. Right of way and other expenses also vary from period to period depending upon location of customer delivery. The increase in water service-related expenses for the six months ended June 30, 2026 compared to the same period of 2025 was principally related to a 16.4% increase in water sales volumes.

General and administrative expenses. General and administrative expenses were $5.9 million for the six months ended June 30, 2026 compared to $4.8 million for the comparable period of 2025. The increase was principally related to increased technology and corporate insurance expenses for the six months ended June 30, 2026 as compared to the same time period of 2025.

Depreciation, depletion and amortization. Depreciation, depletion and amortization was $9.8 million for the six months ended June 30, 2026 compared to $8.8 million for the comparable period of 2025. The increase was principally due to depreciation expense related to new water service-related assets placed in service.

Non-GAAP Performance Measures

In addition to amounts presented in accordance with GAAP, we also present certain supplemental non-GAAP performance measurements. These measurements are not to be considered more relevant or accurate than the measurements presented in accordance with GAAP. In compliance with the requirements of the SEC, our non-GAAP measurements are reconciled to net income, the most directly comparable GAAP performance measure. For all non-GAAP measurements, neither the SEC nor any other regulatory body has passed judgment on these non-GAAP measurements.

EBITDA, Adjusted EBITDA, and Free Cash Flow

EBITDA is a non-GAAP financial measurement of earnings before interest expense, taxes, depreciation, depletion and amortization. The purpose of presenting EBITDA is to highlight earnings without finance, taxes, and depreciation, depletion and amortization expense, and its use is limited to specialized analysis.

The purpose of presenting Adjusted EBITDA is to highlight earnings without non-cash activity such as share-based compensation and other non-recurring or unusual items, if applicable. Additionally, Adjusted EBITDA is a metric used by our compensation committee to evaluate our performance in determining the short-term and long-term incentive compensation of our executive officers on an annual basis. We calculate Adjusted EBITDA as EBITDA plus employee share-based compensation, less land sale with financing arrangement and pension curtailment and settlement gain, as applicable to the periods presented.

The purpose of presenting free cash flow is to provide investors a metric to measure the funds available for investing in future acquisitions and returning capital to our stockholders through dividends and share repurchases after current income tax expense and purchases of fixed assets. Additionally, free cash flow is a metric used by the compensation committee of our Board to evaluate our performance in determining the short-term and long-term incentive compensation of our executive officers. To calculate free cash flow, net income is adjusted by adding back income tax expense, depreciation, depletion and amortization and employee share-based compensation, less current income tax expenses, land sale with financing arrangement, purchases of fixed assets, and pension curtailment and settlement gain, as applicable to the periods presented.

We have presented EBITDA, Adjusted EBITDA, and free cash flow because we believe that these metrics are useful supplements to net income in analyzing our operating performance, ability to fund future acquisitions, ability to return capital to our stockholders and explaining how our executive officers are compensated. Our definitions of EBITDA, Adjusted EBITDA, and free cash flow may differ from computations of similarly titled measures of other companies.

The following table presents a reconciliation of net income to EBITDA and Adjusted EBITDA for the three and six months ended June 30, 2026 and 2025 (in thousands):

The following table presents a reconciliation of net income to free cash flow for the three and six months ended June 30, 2026 and 2025 (in thousands):

Critical Accounting Policies and Estimates

This discussion and analysis of our financial condition and results of operations is based on our condensed consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us to make judgments, estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and disclosures of contingent assets and liabilities. For a full discussion of our accounting policies refer to Note 2 to the consolidated financial statements included in our 2025 Annual Report.

There have been no material changes to our critical accounting policies or in the estimates and assumptions underlying those policies, from those provided in Part II, Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our 2025 Annual Report.

Recent Accounting Pronouncements

For further information regarding recently issued accounting pronouncements, see Note 2, “Summary of Significant Accounting Policies” in the notes to the condensed consolidated financial statements included in Part I, Item 1. “Financial Statements” in this Quarterly Report.

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

There have been no material changes in the information related to market risk of the Company disclosed in Part II, Item 7A. “Quantitative and Qualitative Disclosures about Market Risk” set forth in the 2025 Annual Report.

Item 4. Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

Our management, under the supervision and with the participation of the Company’s Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), performed an evaluation of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15 under the Exchange Act) as of the end of the period covered by this Quarterly Report. Based upon that evaluation, our CEO and CFO have concluded that the Company’s disclosure controls and procedures were effective as of June 30, 2026.

Changes in Internal Control over Financial Reporting

There have been no changes during the quarter ended June 30, 2026 in the Company’s internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II

OTHER INFORMATION

Item 1. Legal Proceedings.

There are no material pending legal proceedings to which we are a party or of which any of our property is the subject.

Item 1A. Risk Factors.

There have been no material changes in the risk factors previously disclosed in response to Part I, Item 1A. “Risk Factors” set forth in the 2025 Annual Report.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

The Company did not repurchase any shares of Common Stock during the three months ended June 30, 2026.

Item 3. Defaults Upon Senior Securities.

Not applicable.

Item 4. Mine Safety Disclosures.

Not applicable.

Item 5. Other Information.

None.

Item 6. Exhibits

Item 6. Exhibits and Financial Statement Schedules.

EXHIBIT INDEX

• Filed herewith.

** The certifications attached as Exhibit 32.1 and Exhibit 32.2 are not deemed “filed” with the SEC and are not to be incorporated by reference into any filing of Texas Pacific Land Corporation under the Securities Act, or the Exchange Act, whether made before or after the date of this Quarterly Report, irrespective of any general incorporation language contained in such filing.