wacbaby is what some t-mobile cell-phones will output if the predictive text is on and the user attempts to type "waaaaay". Hence, wacbaby is used in the same sense as the word waaaaay and is simply an exaggerated form of the word "way".
Chris Avedissian: "Dude, that test was wacbaby too hard! I think I failed!"
Sir Collin Anderson: "Dude, you're wacbaby too stupid! I aced that shiz."