TPC 10-K & 10-Q changes, risk factors and insider trading
Tutor Perini Corp. · NYSE · General Bldg Contractors - Nonresidential Bldgs · CIK 77543 · All filings on SEC.gov
At a glance
What changed in the latest 10-K
Risk Factors
New heading “If we are unable to accurately estimate contract risks, revenue or costs, we may incur a loss or achieve lower than anticipated profit.”
New heading “Economic factors, such as inflation, tariffs, the timing of new awards, or the pace of project execution, have resulted and may continue to result in losses or lower than anticipated profit.”
New heading “Decreases or delays in the level of federal, state and local government spending for infrastructure and other public projects could adversely affect the number of projects available to us in the future.”
New heading “We are subject to risks related to government contracts (including government shutdowns and funding considerations) and related procurement regulations.”
New heading “We cannot guarantee the timing, amount, or payment of dividends on our common stock or that we will repurchase our common stock pursuant to our stock repurchase program.”
Removed heading “If we are unable to accurately estimate contract risks; revenue or costs; economic factors such as inflation and tariffs; the timing of new awards; or the pace of project execution we may incur a loss or achieve lower than anticipated profit.”
Removed heading “The level of federal, state and local government spending for infrastructure and other public projects could adversely affect the number of projects available to us in the future.”
Removed heading “We are subject to risks related to government contracts and related procurement regulations.”
Largest changes
“Our contracts with U.S. federal, as well as state, local and foreign, government entities are subject to various procurement regulations and other requirements relating to their formation, administration and performance. We are subject to audits and investigations relating to our government contracts, and any violations could result in various civil and criminal penalties and administrative sanctions, including termination of contract, refunding or suspending of payments, forfeiture of profits, payment of fines and suspension or debarment from future government business. …”see in full comparison
“Our contracts with U.S. federal, as well as state, local and foreign, government entities are subject to various procurement regulations and other requirements relating to their formation, administration and performance. We are subject to audits and investigations relating to our government contracts, and any violations could result in various civil and criminal penalties and administrative sanctions, including termination of contract, refunding or suspending of payments, forfeiture of profits, payment of fines and suspension or debarment from future government business. …”see in full comparison
“If we are unable to accurately estimate contract risks; revenue or costs; economic factors such as inflation and tariffs; the timing of new awards; or the pace of project execution we may incur a loss or achieve lower than anticipated profit.”see in full comparison
“Economic factors, such as inflation, tariffs, the timing of new awards, or the pace of project execution, have resulted and may continue to result in losses or lower than anticipated profit.”see in full comparison
“Accounting for contract-related revenue and costs requires management to make significant estimates and assumptions that may change substantially throughout the project lifecycle, which has previously resulted, and in the future could result, in a material impact to our consolidated financial statements. In addition, cost overruns, including unanticipated cost increases on fixed price contracts and guaranteed maximum price contracts, have previously resulted, and in the future may result, in lower profits or losses. …”see in full comparison
“Economic factors, including inflation and tariffs, have also previously subjected us, and could in the future subject us, to higher costs, which we may not be able to fully recover in future projects that we are bidding, and may also decrease profit on our existing contracts, in particular with respect to our fixed price, unit price and guaranteed maximum price contracts. Changes in laws, policies or regulations, including tariffs and taxes, have previously impacted, and in the future could impact, the prices for materials or equipment. …”see in full comparison
Full comparison: every changed paragraph (23)
If we are unable to accurately estimate contract risks, revenue or costs, we may incur a loss or achieve lower than anticipated profit.
Accounting for contract-related revenue and costs requires management to make significant estimates and assumptions that may change substantially throughout the project lifecycle, which has previously resulted, and in the future could result, in a material impact to our consolidated financial statements. In addition, cost overruns, including unanticipated cost increases on fixed price contracts and guaranteed maximum price contracts, have previously resulted, and in the future may result, in lower profits or losses.
If we are unable to accurately estimate contract risks; revenue or costs; economic factors such as inflation and tariffs; the timing of new awards; or the pace of project execution we may incur a loss or achieve lower than anticipated profit.
Accounting for contract-related revenue and costs requires management to make significant estimates and assumptions that may change substantially throughout the project lifecycle, which has previously resulted, and in the future could result, in a material impact to our consolidated financial statements. In addition, cost overruns, including unanticipated cost increases on fixed price contracts and guaranteed maximum price contracts, have previously resulted, and in the future may result, in lower profits or losses. Economic factors, including inflation and tariffs, have also previously subjected us, and could in the future subject us, to higher costs, which we may not be able to fully recover in future projects that we are bidding, and may also decrease profit on our existing contracts, in particular with respect to our fixed price, unit price and guaranteed maximum price contracts. Changes in laws, policies or regulations, including tariffs and taxes, such as the recently announced Trump administration tariffs, have previously impacted, and in the future could impact, the prices for materials or equipment. Further, our results of operations have historically fluctuated, and may continue to fluctuate, quarterly and annually depending on when new awards occur and the commencement and progress of work on projects already awarded.
Economic factors, such as inflation, tariffs, the timing of new awards, or the pace of project execution, have resulted and may continue to result in losses or lower than anticipated profit.
Economic factors, including inflation and tariffs, have also previously subjected us, and could in the future subject us, to higher costs, which we may not be able to fully recover in future projects that we are bidding, and may also decrease profit on our existing contracts, in particular with respect to our fixed price, unit price and guaranteed maximum price contracts. Changes in laws, policies or regulations, including tariffs and taxes, have previously impacted, and in the future could impact, the prices for materials or equipment. Further, our results of operations have historically fluctuated, and may continue to fluctuate, quarterly and annually depending on when new awards occur and the commencement and progress of work on projects already awarded.
Decreases or delays in the level of federal, state and local government spending for infrastructure and other public projects could adversely affect the number of projects available to us in the future.
We rely on computer, information and communication technology and other related systems, some of which are hosted by third-party providers, for various business processes and activities, including project management, accounting, financial reporting and business development. These systems are subject to interruptions or damage by a variety of factors including, but not limited to, cyber-attacks, natural disasters, power loss, telecommunications failures, acts of war, computer viruses, email phishing, obsolescence and physical damage. Additionally, the increased prevalence and use of artificial intelligence may heighten the risk that we may be subject to cybersecurity incidents in the future. Such interruptions can result in a loss of critical data, a delay in operations, damage to our reputation or an unintentional disclosure of customer confidential or personally identifiable information, any of which could have a material adverse impact on us and our consolidated financial statements.
The execution of our business strategies also substantially depends on our ability to retain several key members of our management. Losing any of these individuals could adversely affect our business. The majority of these key individuals are not bound by employment agreements. Volatility or lack of positive performance in our stock price may adversely affect our ability to retain key individuals to whom we have provided share-based compensation. We have experienced changes in senior management in the past. Our long-time Chairman and CEO transitioned to the role of Executive Chairman, and we haveappointed a new CEO, both effective as of January 1, 2025. Changes in management, including as a result of succession or voluntary or involuntary termination, including as a result of retirement, death or disability, could adversely affect our business and financial results, particularly if we are not able to identify, engage, and retain qualified successors or if our business, customers, or employees do not respond positively to such changes.
We rely on computer, information and communication technology and other related systems, some of which are hosted by third-party providers, for various business processes and activities, including project management, accounting, financial reporting and business development. These systems are subject to interruptions or damage by a variety of factors including, but not limited to, cyber-attacks, natural disasters, power loss, telecommunications failures, acts of war, computer viruses, email phishing, obsolescence and physical damage. Such interruptions can result in a loss of critical data, a delay in operations, damage to our reputation or an unintentional disclosure of customer confidential or personally identifiable information, any of which could have a material adverse impact on us and our consolidated financial statements.
We are subject to risks related to government contracts (including government shutdowns and funding considerations) and related procurement regulations.
Our contracts with U.S. federal, as well as state, local and foreign, government entities are subject to various procurement regulations and other requirements relating to their formation, administration and performance. We are subject to audits and investigations relating to our government contracts, and any violations could result in various civil and criminal penalties and administrative sanctions, including termination of contract, refunding or suspending of payments, forfeiture of profits, payment of fines and suspension or debarment from future government business. In addition, most of these contracts provide for termination or renegotiation by the government at any time, without cause, which could have an adverse effect on our business and operations. There have also recently been, and there may in the future be, occasions when even previously authorized and committed funding is withheld by the government, which could temporarily delay the progress of certain projects or the awards of new projects. The percentage of our business coming from government entities has continued to increase in recent years, and as of December 31, 2025 accounted for 86% of our backlog. As a result, the risks of adverse consequences related to government contracting and procurement are increasingly fundamental to our business.
For the year ended December 31, 2024,2025, we derived $583.4$489.7 million, or 13%,9%, of revenue from our work on projects locatedin outsideinternational oflocations, theincluding UnitedU.S. States.territories. Our international operations expose us to risks inherent in doing business in regions outside the United States, including political risks; risks of loss due to acts of war; unstable economic, financial and market conditions; potential incompatibility with foreign subcontractors and vendors; foreign currency controls and fluctuations; trade restrictions; economic and trade sanctions; logistical challenges; variations in taxes; and changes in labor conditions, labor strikes and difficulties in staffing and managing international operations. Failure to successfully manage risks associated with our international operations could result in higher operating costs than anticipated or could delay or limit our ability to generate revenue and income from construction operations in key international markets.
The level of federal, state and local government spending for infrastructure and other public projects could adversely affect the number of projects available to us in the future.
We may not fully realize the revenue value reported in our backlog due to cancellations or reductions in scope.scope, including as a result of government-related mandates.
We are subject to risks related to government contracts and related procurement regulations.
Our contracts with U.S. federal, as well as state, local and foreign, government entities are subject to various procurement regulations and other requirements relating to their formation, administration and performance. We are subject to audits and investigations relating to our government contracts, and any violations could result in various civil and criminal penalties and administrative sanctions, including termination of contract, refunding or suspending of payments, forfeiture of profits, payment of fines and suspension or debarment from future government business. In addition, most of these contracts provide for termination or renegotiation by the government at any time, without cause, which could have an adverse effect on our business and operations. The percentage of our business coming from government entities has continued to increase in recent years, and as of December 31, 2024 accounted for 85% of our backlog. As a result, the risks of adverse consequences related to government contracting and procurement are increasingly fundamental to our business.
We have a substantial amount of indebtedness with restrictive covenants which could adversely affect our financial position and prevent us from fulfilling our obligations under our debt agreements, especially in a high interest rate environment.agreements.
We currently have, and expect to continue to have, a substantial amount of indebtedness. As of December 31, 2024,2025, our total debt was $534.1$407.4 million, with $24.1$14.6 million classified as current debt. A significant amount of debt under our credit agreement contains financial covenants, including one covenant to maintain a maximum First Lien Net Leverage Ratio (as defined in the 2020 Credit Agreement (as defined below)), which has required us to obtain two amendments, the First Amendment, dated as of October 31, 2022 and the Second Amendment, dated as of March 10, 2023, to the 2020 Credit Agreement in order to remain in compliance with this covenant. There is a risk that we may need to seek further amendments to this covenant or other covenants in the future should our operating results or financial condition differ materially from our projections. If we are unable to meet the terms of the financial covenants or fail to comply with any of the other restrictions contained in the agreements governing our indebtedness, an event of default could occur, causing the debt related to such agreements to become immediately due. If such acceleration occurs, we may not be able to repay such indebtedness as required. Since indebtedness under our credit agreement entered into on August 18, 2020 (as amended, the “2020 Credit Agreement”) with BMO Harris Bank N.A., as Administrative Agent, Swing Line Lender and L/C Issuer and other lenders is secured by substantially all of our assets, acceleration of this debt could result in foreclosure of those assets and a negative impact on our operations. In addition, a failure to meet the terms of our 2020 Credit Agreement could result in a reduction of future borrowing capacity or additional restrictions under the 2020 Credit Agreement that could negatively impact our liquidity and financial condition. A loss of liquidity could adversely impact our ability to execute projects in our backlog, obtain new projects, engage subcontractors, and attract and retain key employees. Furthermore, we had approximately $127.6 million of outstanding borrowings at December 31, 2024 with variable interest rates. Higher market interest rates could also negatively impact our liquidity and financial condition.
General Risk FactorFactors
The market price of our common stock may fluctuate significantly, which could result in substantial losses for stockholdersshareholders and subject us to litigation.
We cannot guarantee the timing, amount, or payment of dividends on our common stock or that we will repurchase our common stock pursuant to our stock repurchase program.
The timing, declaration, amount, and payment of future dividends to our shareholders falls within the discretion of the Board of Directors. The Board of Director’s decisions regarding the payment of future dividends will depend on many factors, such as our financial condition, earnings, capital requirements, debt service obligations, covenants related to our debt service obligations, industry practice, legal requirements, regulatory constraints, access to the capital markets, and other factors that it deems relevant. We cannot guarantee that we will continue to pay any dividend in the future. Furthermore, although our Board of Directors has authorized a share repurchase program, we are not obligated to make any purchases under the program, and it may be discontinued at any time.
Management's Discussion & Analysis (MD&A)
New heading “Non-GAAP Financial Measures”
New heading “Share Repurchase Program”
Largest changes
“Specifically related to potential tariff impacts, the Company utilizes a pre-award and post-award strategy. As part of its pre-award strategy, the Company’s detailed estimating process includes consideration of anticipated cost increases over the performance period of the contract, as well as additional contingencies to address other potential incremental costs related to unforeseen risks. …”see in full comparison
“With respect to potential concerns regarding the U.S. government’s scrutiny and curtailment of federal funding for certain projects, as well as concerns about recent federal government shutdowns and varying new tariff policies that have been and may continue to be implemented, the Company does not currently anticipate any significant impacts to its business related to these factors. Most of the Company’s major projects are funded at the state or local level, or with some combination of federal, state and local funding. …”see in full comparison
“As amended, the 2020 Credit Agreement requires, solely with respect to the Revolver, the Company and its restricted subsidiaries to maintain a maximum First Lien Net Leverage Ratio of 3.50:1.00, effective the fiscal quarter ended December 31, 2022 and increasing to 3.75:1.00 for the fiscal quarter ending March 31, 2023 and subsequently stepping down to 3.00:1.00 for the fiscal quarter ending June 30, 2023, 2.50:1.00 for the fiscal quarter ending September 30, 2023 and 2.25:1.00 for the fiscal quarter ending December 31, 2023 and each fiscal quarter thereafter. …”see in full comparison
“Consolidated new awards in 2025 were $7.4 billion compared to $12.8 billion in 2024. The Civil and Building segments were the primary contributors to the new awards activity in 2025. …”see in full comparison
Full comparison: every changed paragraph (83)
Consolidated revenue for 2025 was $5.5 billion, up 28% compared to $4.3 billion for 2024. The Company experienced strong growth in all three segments in 2025, primarily driven by increased project execution activities on certain newer, larger and higher-margin projects, all of which have significant scope of work remaining. These projects are in the early stages and are expected to ramp up substantially over the next several years.
Consolidated revenue for 2024 was $4.3 billion, up 12% compared to $3.9 billion for 2023. The increase was primarily driven by significant growth in the Building and Civil segments, as the Company has been successful in pursuing and winning new work and has experienced increased project execution activities on several of the newer projects. The increase was partially offset by reduced project execution activities in the Specialty Contractors segment due to several projects that have completed or are nearing completion. The increase in 2024 was also due to the absence of certain prior-year net unfavorable adjustments, as discussed in more detail below and in Results of Segment Operations. The 2024 period was also adversely impacted by certain current-year net unfavorable adjustments, also discussed in more detail below and in Results of Segment Operations.
LossIncome from construction operations for 20242025 was $103.8$232.0 millionmillion, a dramatic improvement compared to $114.6 million for 2023. The reduceda loss from construction operations of $103.8 million for 2024. The increase in 2024income from construction operations in 2025 was primarily due to contributions related to an overall net increase in project execution activities that totaled $93.2$172.1 million.million Theand improvementa waslower alsoamount of net unfavorable adjustments in 2025 driven by 1) various changes in estimatesthe estimate at completion for projectvarious charges,projects, netincluding: of positive1) impacts from improved productivity and efficiencies on certain projects, net of project charges, which had an aggregate net favorable impact of $104.3 million in 2025 compared to a net unfavorable impact of $36.4 million in 2024 compared to $117.2 million in 2023, partially offset by; 2) certain legal judgments or decisions that had net unfavorable impacts totaling $32.5 million in 2025 compared to $167.7 million in 2024 compared to $122.2 million in 2023; 3) various settlements that had a net unfavorable impact of $45.8 million in 2024 compared to a net favorable impact of $8.4 million in 2023; and 43) temporary aggregate negative project adjustments of $78.7 million in 2025 compared to $97.2 million in 2024 compared to $79.2 million in 2023 due to both the successful negotiation of significant lower margin (and lower risk) change orders and increases in unapproved work on various projects, the temporary impacts to earnings of which are expected to reverse themselves over the remaining lives of the projects. The improvement was partially offset by the impact of various settlements that had a net unfavorable impact of $61.8 million in 2025 compared to $45.8 million in 2024. The significant adjustments in 2025 and 2024 resulting from the above items are discussed in more detail in Results of Segment Operations.
Legal judgments or decisions during 2024 resulted in net unfavorable impacts of $167.7 million, including $101.6 million pertaining to an unexpected adverse arbitration decision on a legacy dispute related to a completed Civil segment bridge project in California, which the Company is appealing; $17.7 million due to an unfavorable judgment on a completed Specialty Contractors segment mass-transit project in California; and $17.4 million due to an unfavorable legal ruling on a completed Civil segment highway project in Virginia.
Legal judgments or decisions during 2023 resulted in net unfavorable impacts of $122.2 million, including an adverse legal ruling on a completed mixed-use project in New York, which resulted in a non-cash charge of $83.6 million, of which $72.2 million impacted the Building segment and $11.4 million impacted the Specialty Contractors segment, and a $24.7 million non-cash charge that resulted from an adverse court ruling on a Specialty Contractors segment educational facilities project in New York.
Settlements during 2024 had a net unfavorable impact of $45.8 million, which included an unfavorable adjustment of $20.0 million associated with the settlement of a legacy dispute related to a completed Building segment government facility project in Florida and the net unfavorable impact of various other settlements that were individually immaterial. The impact of these unfavorable adjustments was partially offset by a favorable adjustment of $18.4 million due to a settlement of a claim associated with a completed Civil segment highway tunneling project in the western United States.
Settlements during 2023 had a net favorable impact of $8.4 million, which included favorable adjustments totaling $58.1 million resulting from the settlement of change orders and changes in estimates due to improved performance on a Civil segment project on the West Coast. This favorable impact was mostly offset by the net unfavorable impacts from other settlements including the net unfavorable impact of $14.4 million from a settlement that affected multiple components of a Civil segment mass-transit project in California. This settlement included the resolution of certain ongoing disputes and increased the expected profit from work to be performed in the future. The settlement resulted in an unfavorable non-cash adjustment of $23.2 million to one component of the project that is nearing completion, partially offset by a favorable adjustment of $8.8 million on the other component of the project that has substantial scope of work remaining. The net unfavorable impact in 2023 from these two adjustments is expected to be mitigated by the increased profit generated from future work on the project. Other settlements in 2023 included a $13.1 million unfavorable non-cash impact (split evenly between the Civil and Building segments) related to a completed transportation project in the Northeast and the net unfavorable impact of various other settlements that were individually immaterial.
Temporary aggregate negative project adjustments referred to above for 2024 of $97.2 million included a temporary non-cash impact of $31.8 million in the fourth quarter for a Civil segment project on the West Coast, which primarily resulted from significant changes that have been negotiated, or are being negotiated, that carry lower margin (and lower risk) that reduced the project’s percentage of completion and overall margin percentage. The remaining amount of temporary negative project adjustments reflected individually immaterial non-cash adjustments due to the successful negotiation of significant lower margin (and lower risk) change orders and growth of unapproved change orders. The temporary impact to earnings resulting from these adjustments is expected to reverse itself over the remaining life of the project.
Temporary aggregate negative project adjustments referred to above for 2023 of $79.2 million included a temporary unfavorable non-cash impact of $40.7 million resulting from the successful negotiation of significant lower margin (and lower risk) change orders on a Civil segment project on the West Coast. These approved change orders increased the project’s overall estimated profit but reduced the project’s percentage of completion and overall margin percentage. This temporary reduction to earnings is expected to reverse itself over the remaining life of the project. The remaining amount of temporary negative project adjustments were individually immaterial and were due to growth in unapproved change orders on various projects that reduced the projects’ percentage of completion and profit margin, which are also expected to reverse over the remaining lives of the projects.
Other significant project charges during 2024 had a net unfavorable impact of $36.4 million, as discussed above, which consisted of the negative impact from changes in estimates on various projects, mostly offset by positive impacts from improved productivity and efficiencies on certain projects. Other significant project charges during 2024 included unfavorable adjustments of $25.9 million on a Building segment government building project in Florida that is now nearing completion, primarily due to increased costs associated with external subcontractors and resolution of certain delay change orders, $15.1 million due to changes in estimates on an otherwise profitable Civil segment mass-transit project in California that is nearly complete, and the net favorable impact of changes in estimates on various other projects that were individually immaterial. All of these project charges and changes in estimates were due to changes in facts and circumstances that were identified in 2024.
Other significant project charges during 2023 had a net unfavorable impact of $117.2 million, and included $62.2 million of unfavorable non-cash adjustments due to changes in estimates on the electrical and mechanical scope of a completed transportation project in the Northeast associated with changes in the expected recovery on certain unapproved change orders resulting from ongoing negotiations; an unfavorable adjustment of $16.9 million on a Specialty Contractors segment multi-unit residential project in New York due to changes in estimates resulting from incremental costs to complete the project and ongoing negotiations on unapproved change orders; a $14.9 million unfavorable adjustment due to changes in estimates due to recent negotiations and incremental cost incurred during project closeout (split evenly between the Civil and Building segments) on the same completed transportation project in the Northeast discussed above; a $14.6 million unfavorable adjustment on a Building segment government building project in Florida primarily due to increased costs associated with an external subcontractor; and the net unfavorable impact of changes in estimates on various other projects that were individually immaterial. All of these project charges and changes in estimates were due to changes in facts and circumstances that were identified in 2023.
Furthermore, lossincome from construction operations for the year ended December 31, 20242025 was negatively impacted by share-based compensation expense of $40.4$150.0 million compared to share-based compensation expense of $12.3$40.4 million in 2023.2024. The increase in share-based compensation expense in 20242025 was primarily due to a substantial increase of 176.9% in the Company’s stock price throughoutduring the year,2025, which impacted the fair value of liability-classified awards. These liability-classified awards are remeasured at fair value at the end of each reporting period with the change recognized in earnings. These types of awards were issued in past years as a short-term solution to deal with a depleted share pool under the Tutor Perini Corporation Omnibus Incentive Plan (the “Plan”) and a low stock price. The Company currently projects a decrease in share-based compensation expense in 2026 and a much more significant decrease in 2027 as certain such awards have vested and most of the remaining liability-classified awards will vest by the end of 2026. After the Company’s shareholders approved additional shares under the Plan in May 2025, the Company stopped issuing liability-classified, long-term incentive compensation awards, which will help to reduce future earnings volatility.
Diluted earnings per common share for 2025 was $1.51 compared to diluted loss per common share of $3.13 for 2024. Adjusted diluted earnings per common share, which is a non-GAAP financial measure and excludes share-based compensation expense (and the associated tax benefit) for 2025 was $4.29, compared to an adjusted diluted loss per common share of $2.37 for 2024. The improvement for 2025 was primarily due to the factors discussed above that resulted in the change in income (loss) from construction operations for such period. Refer to the Non-GAAP Financial Measures section below for further information and a reconciliation of the Company's financial results reported under generally accepted accounting principles in the United States (“GAAP”) to the reported adjusted results.
The Company generated record cash flow from operations of $748.1 million in 2025 largely driven by collections from newer and ongoing projects and, to a much lesser extent, from collections related to recent dispute resolutions. The Company utilized some of its cash flow from operations in 2025 to voluntarily prepay its outstanding Term Loan B debt of $121.9 million.
Consolidated new awards in 2025 were $7.4 billion compared to $12.8 billion in 2024. The Civil and Building segments were the primary contributors to the new awards activity in 2025. Significant new awards and contract adjustments in 2025 included the $1.87 billion Midtown Bus Terminal Replacement - Phase 1 project in New York; the $1.18 billion Manhattan Tunnel project in New York; a healthcare facility project in California valued at approximately $1 billion; a $538 million healthcare project in California; $241 million of additional funding for the Apra Harbor Waterfront Repairs project in Guam; a $182 million military defense project in Guam; a $155 million education facility project in California; $131 million of additional funding for an electrical project in Texas; and another electrical project in Texas valued at more than $100 million. The Company has continued to be successful in winning its share of major new project opportunities due to a combination of its strategic bidding approach and favorable market dynamics, including limited competition in select markets for some of the larger projects. This environment, which is supported by strong public funding and demand, has allowed the Company to differentiate itself and deliver compelling proposals that align with the customer’s goals and expectations. The Company expects that this environment will continue for the foreseeable future.
Diluted loss per common share for 2024 was $3.13 compared to $3.30 for 2023. The change in 2024 was primarily due to the factors discussed above that led to the change in loss from construction operations.
The Company generated record cash flow from operations of $503.5 million in 2024 as a result of significant progress made in the resolution of various disputed matters, including those discussed above, and cash generation related to project execution activities for new and existing projects. The Company utilized some of its cash flow from operations for repayments of its outstanding Term Loan B debt, which was paid down by $245.3 million in 2024. During the first quarter of 2025, the Company voluntarily repaid the remaining $121.9 million outstanding balance of the Term Loan B.
Consolidated new awards in 2024 were $12.8 billion compared to $6.1 billion in 2023. The Civil and Building segments were the primary contributors to the new award activity in 2024. Significant new awards and contract adjustments in 2024 included the $3.76 billion Manhattan Jail project in New York; the $1.66 billion City Center Guideway and Stations project in Hawaii; a $1.4 billion healthcare campus project in California; the $1.13 billion Newark AirTrain Replacement project in New Jersey; the $1.1 billion Kensico-Eastview Connection Tunnel project in New York; $479 million of additional funding for certain mass-transit projects in California; $449 million for two healthcare facility projects in California; $331 million for the Apra Harbor Waterfront Repairs project in Guam; a $229 million airport terminal connectors project at Fort Lauderdale-Hollywood International Airport in Florida; and the Company’s proportionate share of the $1.3 billion Connecticut River Bridge Replacement project in Connecticut.
Consolidated backlog as of December 31, 20242025 was $18.7$20.6 billion, up 84%10% compared to $10.2$18.7 billion as of December 31, 2023, and set a new all-time record that far exceeded the previous record backlog of $14.0 billion reported for the third quarter of 2024. Backlog as of December 31, 2024 for all three segments also set new all-time records. As of December 31, 2024,2025, the mix of backlog by segment was 49% for Civil, 36% for Building and 15% for Specialty Contractors, compared to 47% for Civil, 38% for Building and 15% for Specialty Contractors, compared to 42% for Civil, 41% for Building and 17% for Specialty Contractors at the end of 2023.2024.
Most projects in the Civil segment’s backlog typically convert to revenue over a period of three to five years and in the Building and Specialty Contractors segments over a period of one to three years. Certain larger projects across all three segments may extend over a longer duration. We estimate that approximately $4.5$6 billion, or approximately 24%,29%, of our backlog as of December 31, 20242025 will be recognized as revenue in 2025.2026.
With respect to potential concerns regarding the U.S. government’s scrutiny and curtailment of federal funding for certain projects, as well as concerns about recent federal government shutdowns and varying new tariff policies that have been and may continue to be implemented, the Company does not currently anticipate any significant impacts to its business related to these factors. Most of the Company’s major projects are funded at the state or local level, or with some combination of federal, state and local funding. For projects that are wholly or partially funded with federal dollars, the funding for those projects has already been committed and/or those projects are strategically important to the United States. Despite this, there have recently been, and there may in the future be, occasions where even previously authorized and committed funding is withheld by the government, which could delay the progress of certain projects or the awards of new projects. The Company does not anticipate any material adverse impacts to its financial results as the result of such temporary project delays.
Specifically related to potential tariff impacts, the Company utilizes a pre-award and post-award strategy. As part of its pre-award strategy, the Company’s detailed estimating process includes consideration of anticipated cost increases over the performance period of the contract, as well as additional contingencies to address other potential incremental costs related to unforeseen risks. Prior to its bid or proposal submission, the Company also works to negotiate favorable contract provisions that provide entitlement for certain compensable events, which may include price escalation and allowances. Once the project is awarded, the Company’s strategy shifts to entering into purchase orders or “buy-outs” of materials, such as steel and concrete, as well as large pieces of equipment at the onset of projects, which mitigate the risk of future equipment and commodity price increases by passing that risk to vendors. Also at that time, the Company enters into fixed-price contracts with its key project subcontractors whereby the risk of unforeseen escalation is transferred to the subcontractors. The Company benefits from its long-term relationships with key suppliers, vendors and subcontractors, which minimize supply chain disruptions that could arise as a result of tariffs. While the Company believes this strategy appropriately mitigates the current risk of potential tariff impacts, there could be other unforeseen future developments. The Company will continue to monitor and assess its exposure to the economic environment.
The outlook for the Company’s revenue growth over the next several years isremains highly favorable, particularlyfavorable due to strong new award bookings inof 2024,large, long-duration projects over the past two years, as well as other significant new awards that haveare beenexpected and couldto be booked in 2025.the future. For example, the Company announcedhas certain building projects in California, mostly in the firsthealthcare, quartereducation, ofand 2025hospitality and gaming sectors, that are in the awardpreconstruction ofphase. These projects are expected to transition from preconstruction to construction over the $1.18next billionfew Manhattanyears, Tunneland they include a large, multi-billion-dollar healthcare project in New York and $232 million for several owner-authorized scope options on the Apra Harbor Waterfront Repairs project in Guam. The Company plans to bid various other large new projects in 2025, including the multi-billion-dollar Midtown Bus Terminal Replacement project in New YorkCalifornia that is expectedanticipated to bidbe inincrementally Marchadded 2025.to backlog over the next two to three years. Many of the Company’s newer projects are design-build projects that have an initial design phase over the first six to eighteen monthsmonth design phase during which smaller revenue and earnings are generated prior to the start of a multi-year construction phase that generates substantially larger revenue and earnings. Revenue growth could be impacted by unanticipated project delays or the timing of project bids, awards, commencements, ramp-up activities and completions. We anticipate that we will continue to win our share of significant new project awards resulting from long-term, well-funded capital spending plans by various state, local and federal customers, as well as limited competition for many of the larger project opportunities.
Nationally, support for transportation-related ballot measures has remained high over the last decade. Since 2014, voters in 43 states approved 84 percent of nearly 3,000 state and local measures on general election ballots. The largest of these was in Los Angeles County, where in 2016 Measure M, a half-cent sales tax increase, was approved and is expected to generate $120 billion of funding over 40 years. Funding from this measure is supporting, and is expected to continue to support, several of the Company’s current and prospective projects. More recently, in the November 2024 elections, voters approved 77 percent of 370 transportation funding measures on state and local ballots throughout the country. These measures are expected to generate an estimated $41.4 billion in new and renewed funding for roads, bridges, rail and other infrastructure. ForAdditionally, the firstFederal timeReserve in four years,lowered interest rates werein loweredthe fall of 2024 and further reduced rates in Septemberthe 2024,second half of 2025, and some economists expect furthercontinued interest rate reductions in 2025,2026, though the actual timing and extent of any futuresuch rate reductions remains uncertain. Lower interest rates could supportresult in additional demand for continued infrastructuregeneral construction spending. In contrast, should interest rates rise, they could reach levels that may negatively impact demand, especially for certain types of Building segment projects that have already been experiencing such impacts, such as commercial offices and tenant improvement projects, which tend to be more economically sensitive than projects handled by our Civil segment.
The Bipartisan Infrastructure Law provideswas enacted into law in November 2021 and provided for $1.2 trillion of federal infrastructure funding, including $550 billion in new spending for improvements to the country’s surface-transportation network and enhancements to core infrastructure. The Bipartisan Infrastructure Law initiated the largest federal investment in public transit ever, the single largest dedicated bridge investment since the construction of the interstate highway system and the largest federal investment in passenger rail since the creation of Amtrak, all in addition to providing for regular annual spending for numerous infrastructure projects. This significant incremental funding is anticipated to be spent over the 10 years from its enactment through 2031, and much of it is allocated for investment in end markets that are directly aligned with the Company’sour market focus. Accordingly, thewe Company believesbelieve that this significant level of sustained, incremental funding has benefited, and will continue to favorably impact, the Company’sour current work and prospective opportunities over the next decade. While the current funding window for the Bipartisan Infrastructure Law closes on September 30, 2026, we believe that Congress recognizes the long-term nature of infrastructure work and is already engaged in the legislative process to secure future funding beyond that date, although the amount and composition of such future funding is yet to be determined. In addition, various existing projects and future project opportunities in Guam and the Indo-Pacific region are being funded by the U.S. government’s Pacific Deterrence Initiative, which provides substantial multi-year funding to support significant improvements that enhance the U.S. military’s infrastructure and readiness. Finally, there are various large infrastructure projects across the U.S. for which future funding may be provided, in part or entirely, through public-private partnership (P3) arrangements, which would include mostly private capital investments.
Non-GAAP Financial Measures
To supplement our audited Consolidated Financial Statements presented under GAAP, we are presenting certain non-GAAP financial measures. These non-GAAP financial measures are intended to provide additional insights that facilitate the comparison of our past and present performance, and they are among the indicators management uses to assess the Company’s financial performance and to forecast future performance. By presenting these non-GAAP financial measures, we aim to provide investors and stakeholders with a clearer understanding of our operating results and enhance transparency with respect to the key financial metrics used by our management in its financial and operational decision-making.
These non-GAAP financial measures, which exclude share-based compensation expense for the years ended December 31, 2025, 2024 and 2023 (as well as the tax benefit associated with the expense), consist of adjusted net income (loss) attributable to the Company and adjusted earnings (loss) per share. We exclude share-based compensation expense because this expense could result in significant volatility in our reported earnings, driven primarily by fluctuations in the expense recognized for certain long-term incentive compensation awards with payouts that are indexed to the Company’s common stock. By adjusting for share-based compensation, our non-GAAP measures present a supplemental depiction of our operational performance and financial health. This approach allows stakeholders to focus on our core operational efficiency and profitability without the variable impact to earnings caused by significant changes in our stock price. Our non-GAAP measures are intended to offer a consistent basis for evaluating the Company’s performance, which management believes is meaningful to stakeholders.
The non-GAAP financial measures included in this Annual Report on Form 10-K as calculated by the Company are not necessarily comparable to similarly titled measures reported by other companies. Additionally, these non-GAAP financial measures are not meant to be considered as indicators of performance in isolation from or as a substitute for the most directly comparable measures prepared in accordance with GAAP and should be read only in conjunction with financial information presented on a GAAP basis.
Reconciliations of these non-GAAP financial measures are found in the table below:
(a)The amount represents share-based compensation expense recorded during the years ended December 31, 2025, 2024 and 2023. This includes expense associated with certain long-term incentive compensation awards that have payouts indexed to the Company’s common stock. As such, significant fluctuations in the price of the Company’s common stock during any reporting period have caused and could continue to cause significant fluctuations in the reported expense. The increase in the expense for the year ended December 31, 2025 as compared to the prior-year periods was driven by the substantial increase in the price of the Company’s stock during the 2025 period.
Revenue for 2025 increased 34% compared to 2024, and set a new record for the segment. The substantial growth was primarily due to increased project execution activities on certain newer, larger and higher-margin projects, all of which have substantial scope of work remaining.
Revenue for 2024 increased 12% compared to 2023, primarily due to a net increase in project execution activities driven by certain large mass-transit projects in California and Hawaii, two airport projects in the Northern Mariana Islands, and the tunneling component of an energy project in British Columbia, partially offset by reduced project execution activities on a mass-transit project in the Midwest that is nearing completion. The increase was also partially offset by an unfavorable adjustment related to an unexpected adverse arbitration decision on a legacy dispute related to a completed bridge project in California, which the Company is appealing.
Income from construction operations for 20242025 decreasedincreased $60.3$252.6 million compared to 2023.2024, and also set a new record for the segment. The decreasesignificant improvement was primarily due to contributions related to the increased project execution activities discussed above and the absence of certain prior-year net unfavorable adjustments. These prior-year net unfavorable adjustments in 2024, includingincluded $101.6 million in the third quarter pertaining to the aforementionedan unexpected adverse arbitration decision on a legacy dispute related to a completed bridge project in California, which the Company is appealing; a temporary non-cash impact of $31.8 million in the fourth quarter for a project on the West Coast, which primarily resulted from significant changes that have been negotiated,negotiated or are being negotiated, thatand carry lower margin (and lower risk) that reduced the project’s percentage of completion and overall margin percentage; $17.4 million due to an unfavorable legal ruling on a completed highway project in Virginia; and $15.1 million due to changes in estimates on an otherwise profitable mass-transit project in California that is nearly complete. The decrease wascomplete, partially offset by contributionsa related to the net increase in project execution activities discussed above that totaled $70.4 million, as well as aprior-year favorable adjustment in 2024 of $18.4 million due to a settlement of a claim associated with a completed highway tunneling project in the western United States. The 2025 period was also impacted by certain largely offsetting adjustments, including favorable adjustments of $57.6 million that resulted from the settlement of certain change orders and changes in estimates due to improved performance and a favorable project closeout on a domestic mass-transit project, mostly offset by an unfavorable adjustment of $54.7 million due to the settlement of a legacy dispute related to a tunneling project in Canada.
The decrease in income from construction operations was also partially offset by a net favorable impact of $9.6 million due to the absence of the following prior-year adjustments: 1) a net unfavorable adjustment of $14.4 million due to the aforementioned settlement that affected multiple components of a mass-transit project in California; 2) an unfavorable adjustment of $14.2 million due to changes in estimates on the Civil segment’s portion of a completed transportation project in the Northeast primarily related to the settlement of certain change orders, changes in estimates associated with recent negotiations and incremental cost incurred during project closeout; and 3) net favorable adjustments totaling $19.0 million for a project on the West Coast.
Operating margin was 6.5%13.7% for 20242025 compared to 10.5%6.5% in 2023.2024. The decreaseincrease in operating margin for 20242025 was primarily due to the aforementionedabove-mentioned unfavorablefactors adjustmentthat of $101.6 million related todrove the unexpected adverse arbitration decision on a legacy dispute related to a completed bridge projectincreases in California.revenue and income from construction operations.
New awards and contract adjustments in the Civil segment totaled $4.2 billion in 2025 compared to $6.7 billion in 2024 compared to $1.7 billion in 2023.2024. Significant new awards and contract adjustments in 20242025 included the $1.66$1.87 billion CityMidtown CenterBus Guideway and Stations project in Hawaii; the $1.13 billion Newark AirTrainTerminal Replacement - Phase 1 project in New JerseyYork; the $1.1$1.18 billion Kensico-Eastview ConnectionManhattan Tunnel project in New York; the Civil segment’s share of both the $3.76 billion Manhattan Jail project and the $2.95 billion Brooklyn Jail project, both in New York; $479$241 million of additional funding for certain mass-transit projects in California; $331 million for the Apra Harbor Waterfront Repairs project in Guam; and thea Company’s$182 proportionatemillion sharemilitary of the $1.3 billion Connecticut River Bridge Replacementdefense project in Connecticut.Guam.
New awards and contract adjustments in 2024 included the $1.66 billion City Center Guideway and Stations project in Hawaii; the $1.13 billion Newark AirTrain Replacement project in New Jersey; the $1.1 billion Kensico-Eastview Connection Tunnel project in New York; the Civil segment’s share of both the $3.76 billion Manhattan Jail project and the $2.95 billion Brooklyn Jail project, both in New York; $479 million of additional funding for certain mass-transit projects in California; $331 million for the Apra Harbor Waterfront Repairs project in Guam; and the Company’s proportionate share of the $1.3 billion Connecticut River Bridge Replacement project in Connecticut.
New awards and contract adjustments in 2023 included $788 million of additional funding for certain mass-transit projects in California; a $222 million military facilities project at Tinian International Airport in the Commonwealth of the Northern Mariana Islands; and $127 million of additional funding for a mass-transit project in Minnesota.
Backlog for the Civil segment was $10.2 billion as of December 31, 2025, up 15% compared to $8.8 billion as of December 31, 2024, up 108% compared to $4.2 billion as of December 31, 2023, and set a new all-time record for the segment.2024. The segment continues to experience strong demand reflected in a large, multi-year pipeline of prospective projects, and supported by substantial anticipated funding from various voter-approved state and local transportation measures, the Bipartisan Infrastructure Law, and by public agencies’ long-term spending plans. We believe that the Civil segment is well-positioned to capturecontinue capturing its share of these prospective projects.projects, with the majority of near-term opportunities on the West Coast, in the Midwest, the Northeast, and the Indo-Pacific region.
Revenue and income (loss) from construction operations for the Building segment are summarized as follows:
Revenue for 20242025 increased 24%15% compared to 2023,2024, withprimarily thedue growth driven byto increased project execution activities on varioustwo healthcarelarge and educationaldetention facility projects in CaliforniaNew York and a detentionlarge healthcare facility project in NewCalifornia, Yorkall withof which have substantial scope of work remaining, as well as the absence of a prior-year unfavorable adjustment related to an adverse legal ruling on a completed mixed-use project in New York.remaining.
LossIncome from construction operations for 20242025 was $24.1$58.2 million compared to a loss of $91.2$24.1 million for 2023.2024. The significant improvement was principally due to the absence of prior-year unfavorable adjustments, including the aforementioned prior-year unfavorable adjustment related to the adverse legal ruling on a completed mixed-use project in New York that resulted in a non-cash charge of $83.6 million, of which $72.2 million impacted the Building segment, a $14.6 million unfavorable adjustment on a government building project in Florida primarily due to increased costs associated with an external subcontractor, and a $14.2 million unfavorable adjustment due to changes in estimates on the Building segment’s portion of the aforementioned completed transportation project in the Northeast. The improvement was also due to contributions related to the increased project execution activities discussed above that totaled $26.6 million, partially offset byand the impactabsence of certain prior-year unfavorable adjustmentsadjustments, in 2024 ofincluding $25.9 million on thea completed government building project in Florida mentioned above, which is now nearing completion, primarily due to increased costs associated with external subcontractors and resolution of certain delay change orders,orders and $20.0 million associated with the settlement of a legacy dispute related to a completed government facility project in Florida.
Operating margin was 3.1% in 2025 compared to (1.5)% in 2024 compared to (7.0)% in 2023.2024. The increase in operating margin was driven by the above-mentioned factors mentioned above that drove the improvedincreases in revenue and income (loss) from construction operations.
New awards and contract adjustments in the Building segment totaled $2.2 billion in 2025 compared to $4.5 billion in 2024. Significant new awards and contract adjustments in 2025 included a healthcare facility project in California valued at approximately $1 billion; a $538 million healthcare project in California; and a $155 million education facility project in California. Certain Building segment end markets, such as healthcare, education, industrial/manufacturing, and hospitality and gaming, continue to demonstrate strong demand for new and renovated facilities.
New awards in the Building segment totaled $4.5 billion in 2024 compared to $3.3 billion in 2023. Significant new awards and contract adjustments in 2024 included the Building segment’s portion of the $3.76 billion Manhattan Jail project in New York (which includes a substantial amount of electrical and mechanical scope of work that is expected towill be performed by the Specialty Contractors segment); a $1.4 billion healthcare campus project in California; $449 million for two healthcare facility projects in California; and a $229 million airport terminal connectors project at Fort Lauderdale-Hollywood International Airport in Florida.
Certain Building segment end markets, such as healthcare, education, industrial/manufacturing, and hospitality and gaming, continue to show strong demand for new and renovated facilities. However, the proliferation of remote and hybrid work settings at many companies, along with continued elevated interest rates, could continue to result in delayed or canceled Building segment project opportunities, particularly in the corporate office end market.
New awards and contract adjustments in 2023 included the $2.95 billion Brooklyn Jail project in New York (which includes more than $630 million of electrical and mechanical subcontract work to be performed by the Specialty Contractors segment) and $287 million of additional funding for two large healthcare projects in California.
Backlog for the Building segment was $7.3 billion as of December 31, 2025, up 4% compared to $7.0 billion as of December 31, 2024, up 68% compared to $4.2 billion as of December 31, 2023, and set a new all-time record for the segment, with the increase largely driven by the award of the Manhattan Jail project mentioned above.2024. The Building segment continues to experience strong customer demand as reflected by a large volume of prospective projects across various end markets and geographic locations. In addition, there are variouscertain healthcarehealthcare, education, and educationhospitality and gaming projects underway in California that are in the preconstruction phase, with only a small amountportion of currenttheir backlogfull recordedanticipated forvalue them.included Somein ofour thesereported backlog. These projects are soon expected to advancetransition intofrom preconstruction to construction over the constructionnext phase,few years, and wethey anticipateinclude a large, multi-billion-dollar healthcare project in California that weis willanticipated bookto significantbe additionalincrementally added to backlog forover thesethe projectsnext astwo ato result.three years.
Revenue for 20242025 decreasedincreased 15%43% compared to 2023,2024, principallyprimarily due to reducedincreased project execution activities on variousthe electrical and mechanical components of various newer projects inacross Newdiverse Yorkend markets, all with substantial scope of work remaining and Florida and an industrial facility project in Arizona, all of which are completed or nearing completion. The decrease was partially offsetdriven by theoverall absencestrong ofmarket certain prior-year unfavorable adjustments described in the paragraph below.demand.
Loss from construction operations for 2025 was $7.5 million compared to $103.3 million for 2024. The significant improvement was primarily due to contributions related to the increased project execution activities discussed above. Many of these projects are in the early stages and are expected to ramp up substantially over the next several years. The improvement was also driven by a reduction in net unfavorable adjustments in 2025, primarily due to the absence of certain prior-year unfavorable adjustments on several completed projects due to the impact of judgments and settlements that totaled $57.2 million in 2024, including $17.7 million due to an unfavorable judgment on a completed mass-transit project in California and certain other adjustments that were individually immaterial.
Loss from construction operations for 2024 was $103.3 million compared to a loss of $144.8 million for 2023. The improvement was primarily due to the absence of certain prior-year unfavorable adjustments, including $62.2 million of unfavorable non-cash adjustments due to changes in estimates on the electrical and mechanical scope of a completed transportation project in the Northeast associated with changes in the expected recovery on certain unapproved change orders resulting from ongoing negotiations; a non-cash charge of $24.7 million on an educational facilities project in New York that resulted from an adverse court ruling; an unfavorable adjustment of $16.9 million on a multi-unit residential project in New York due to changes in estimates resulting from incremental costs to complete the project and ongoing negotiations on unapproved change orders; and an adverse legal ruling on a completed mixed-use project in New York that resulted in a non-cash charge of $83.6 million, of which $11.4 million impacted the Specialty Contractors segment. The improvement was partially offset by certain 2024 unfavorable adjustments on several completed projects due to the impact of judgments and settlements totaling $57.2 million, including $17.7 million due to an unfavorable judgment on a completed mass-transit project in California and certain other adjustments that were individually immaterial. The improvement was also offset by the reduced project execution activities discussed above.
Operating margin was (0.9)% in 2025 compared to (17.5)% in 2024 compared to (20.9)% in 2023.2024. The change in operating margin was mainly attributable to the aforementioned factors that drove the lowerchanges revenue and loss from construction operations in 2024.2025.
New awards and contract adjustments in the Specialty Contractors segment totaled $1.1 billion in 2025 compared to $1.7 billion in 2024 compared to $1.1 billion in 2023.2024. The most significant new awards and contract adjustments in 20242025 included the Specialty Contractors segment’s electrical andfive mechanical scope of work booked as part of the Manhattan Jail project discussed above, two electrical projects in New YorkFlorida collectively valued at $195$155 million, $136 million andfor the electrical component of a $64mass-transit project in the Northeast, $131 million of additional funding for an electrical project in Connecticut.Texas and another electrical project in Texas valued at more than $100 million.
New awards and contract adjustments in 2024 included the Specialty Contractors segment’s electrical and mechanical scope of work booked as part of the Manhattan Jail project discussed above, two electrical projects in New York collectively valued at $195 million and a $64 million electrical project in Connecticut.
New awards in 2023 included more than $630 million of electrical and mechanical subcontract work to be performed on the Brooklyn Jail project in New York; a $67 million communications systems integration project in New York; and the Central District Wastewater Treatment Plant electrical project in Florida, valued at more than $40 million.
Backlog for the Specialty Contractors segment was $3.1 billion as of December 31, 2025, up 9% compared to $2.8 billion as of December 31, 2024, up 62% compared to $1.7 billion as of December 31, 2023, and set a new all-time record for the segment.2024. The Specialty Contractors segment continues to be primarily focused on servicing the Company’s current and prospective large Civil and Building segment projects, particularly in the Northeast and California. We believe that the segment remains well-positioned to capturecontinue capturing its share of other new projects, leveraging the size and scale of our business units that operate in New York, Texas, Florida and California and the strong reputation held by thesethe business units in this segment for high-quality work on large, complex projects.
Corporate general and administrative expenses were $210.8 million in 2025 compared to $110.2 million in 2024. The increase in corporate general and administrative expenses in 2025 compared to 2024 was primarily due to a substantial increase in share-based compensation expense that resulted from a higher stock price, which impacted the fair value of liability-classified awards. The Company currently projects a decrease in share-based compensation expense in 2026 and a much more significant decrease in 2027 as certain such awards have vested and most of the remaining liability-classified awards will vest by the end of 2026. After the Company’s shareholders approved additional shares under the Plan in May 2025, the Company stopped issuing liability-classified, long-term incentive compensation awards, which will help to reduce future earnings volatility.
Corporate general and administrative expenses were $110.2 million in 2024 compared to $75.2 million in 2023. The increase in corporate general and administrative expenses in 2024 compared to 2023 was primarily due to higher compensation-related expenses, mainly attributable to higher share-based compensation expense. The increase in share-based compensation expense was primarily due to a substantial increase in the Company’s stock price during the 2024 period, which impacted the fair value of liability-classified awards. These awards are remeasured at fair value at the end of each reporting period with the change recognized in earnings.
Other Income, Net, Interest Expense and Income Tax (Expense) Benefit
What changed in the latest 10-Q
Risk Factors
There have been no material changes to our risk factors as disclosed in our Annual Report on Form 10-K for the year ended December 31, 2025.
No wording changes found in this section.
Full comparison: every changed paragraph (0)
Management's Discussion & Analysis (MD&A)
Largest changes
“On July 2, 2026, the Company entered into an amendment and restatement to the 2020 Credit Agreement (the “2026 Credit Agreement”) to, among other things, extend the maturity of the Revolver to July 2, 2031, increase the commitments under the Revolver from $170.0 million to $350.0 million, reduce the Adjusted Term SOFR margin to a range between 1.75% and 2.50% based on a Total Net Leverage Ratio (compared to the previous range between 4.25% and 4.75% based on a First Lien Net Leverage Ratio) and eliminate the credit spread adjustment (10 basis points), reduce the base rate margin to a range …”see in full comparison
“As discussed further in Liquidity and Capital Resources below, as of July 2, 2026, the Company completed the refinancing of its senior notes and entered into an amendment and restatement of its existing revolving credit facility, which, among other things, extended debt maturities, is expected to significantly reduce future interest expense, more than doubles the size of its available revolving credit facility and provides for meaningfully improved terms.”see in full comparison
“As discussed further in Debt below, as of July 2, 2026, we completed the refinancing of our senior notes and entered into an amendment and restatement of our existing revolving credit facility, which, among other things, extends debt maturities, is expected to significantly reduce future interest expense, more than doubles the size of our available revolving credit facility and provides for meaningfully improved terms.”see in full comparison
see in full comparisonThereExcept for the July 2, 2026 refinancing of our senior notes and the amendment and restatement of our existing revolving credit facility, as discussed further in Debt, there have been no material changes in our contractual obligations from those described in our Annual Report on Form 10‑K for the year ended December 31, 2025.
“Interest expense for the three and six months ended June 30, 2026 increased $0.1 million and decreased $0.8 million, respectively, compared to the same periods in 2025. As a result of the refinancing of its senior notes completed on July 2, 2026, discussed further in Liquidity and Capital Resources below, the Company expects annualized cash interest expense savings of $21.0 million.”see in full comparison
“As of June 30, 2026, we were in compliance with the covenants under the 2020 Credit Agreement. As discussed below, effective July 2, 2026, this covenant was replaced with two new financial maintenance covenants. The Company is currently in compliance with these covenants and expects to remain in compliance.”see in full comparison
Full comparison: every changed paragraph (67)
The following discussion and analysis of our financial position as of MarchJune 31,30, 2026 and the results of our operations for the three and six months ended MarchJune 31,30, 2026 should be read in conjunction with other information, including the unaudited Condensed Consolidated Financial Statements and notes included in Part I, Item 1, Financial Information,Statements, of this Quarterly Report on Form 10‑Q, the audited consolidated financial statements and accompanying notes to our Annual Report on Form 10‑K for the year ended December 31, 2025, and the information contained under the heading “Risk Factors” in our Annual Report on Form 10‑K for the year ended December 31, 2025 and in Part II, Item 1A below.
Consolidated revenue for the three and six months ended MarchJune 31,30, 2026 was $1.4$1.6 billion and $3.0 billion, up 11.5%19.2% and 15.5% respectively, compared to $1.2$1.4 billion and $2.6 billion for the same periodperiods in 2025. The Company's revenue for the firstsecond quarter of 2026 was the highest of any first quarter since 2009,ever, and revenue for the first six months of 2026 also set a new record for the first half of any year. The Civil segment's revenue wasalso theset highestrecords offor anythese firstsame quarter ever.periods. The Company experienced strong growth inacross all three segments in the second quarter and through the first threesix months of 2026 compared to the same periodperiods last year, primarily driven by increased project execution activities on certain newer, larger and higher-margin projects that have significant scope of work remaining. These projects are in the early stages and are expected to ramp up substantially over the next severalfew years.
Income from construction operations for the three months ended June 30, 2026 was a record $117.7 million, up 54.0% compared to $76.4 million for the same period in 2025, and the highest result of any quarter ever. The substantial increase was primarily driven by contributions associated with the increased project execution activities discussed above, as well as a significant decrease of $27.5 million in share-based compensation expense compared to the same period of 2025. The decrease in share-based compensation expense was primarily due to the absence of certain liability-classified awards that vested at the end of 2025.
Income from construction operations for the three months ended March 31, 2026 was $59.2 million compared to $65.3 million for the same period in 2025. The first three months of 2026 were positively impacted by contributions associated with the increased project execution activities discussed above. These contributions were offset by a $23.5 million increase in share-based compensation expense as compared to the first quarter of 2025. This increase was primarily due to the Company’s stock price being substantially higher in 2026 as compared to the same period of 2025, which impacted the fair value of liability-classified awards. These awards are remeasured at fair value at the end of each reporting period with the change in fair value recognized in earnings. After the Company’s shareholders approved additional shares under the Plan in May 2025, the Company stopped awarding liability-classified, long-term incentive compensation awards. The first quarter of 2026 was also impacted by an unfavorable adjustment of $16.4 million on a Civil segment mass-transit project in California primarily due to changes in estimates resulting from ongoing negotiations of change orders with the owner and subcontractors, as well as other temporary impacts related to unapproved change orders.
Income taxfrom expenseconstruction was $17.0 millionoperations for the threesix months ended MarchJune 31,30, 2026 was a record $176.9 million, up 24.8% compared to $12.9$141.8 million for the same period in 2025. SeeThe Corporate,increase Taxwas andprimarily Otherdriven Mattersby belowcontributions forassociated a discussion ofwith the changeincreased inproject theexecution effectiveactivities taxdiscussed rate.above.
Income tax expense was $30.8 million and $47.8 million for the three and six months ended June 30, 2026, respectively, compared to $22.0 million and $34.9 million for the same periods in 2025. See Corporate, Tax and Other Matters below for a discussion of the change in the effective tax rate.
Diluted earnings per common share for the three and six months ended MarchJune 31,30, 2026 was $0.48$1.23 and $1.71, respectively, compared to $0.53$0.38 and $0.90 for the same periodperiods in 2025. Adjusted diluted earnings per common share, which is a non-GAAP financial measure and excludes share-based compensation expense (and the associated tax benefit), for the three and six months ended MarchJune 31,30, 2026 was $1.03$1.74 and $2.77, respectively, compared to $0.65$1.41 and $2.06 for the same periodperiods in 2025. The changestrong increase in diluted earnings per common share for both periods was primarily due to the factors discussed above that resulted in the change in income from construction operations. The strong increase in adjusted diluted earnings per common share reflects the same factors discussed above, excluding the impact of share-based compensation expense. Refer to the Non-GAAP Financial Measures section below for further information and a reconciliation of the Company's financial results reported under generally accepted accounting principles in the United States (“GAAP”) to the reported adjusted results.
As discussed further in Liquidity and Capital Resources below, as of July 2, 2026, the Company completed the refinancing of its senior notes and entered into an amendment and restatement of its existing revolving credit facility, which, among other things, extended debt maturities, is expected to significantly reduce future interest expense, more than doubles the size of its available revolving credit facility and provides for meaningfully improved terms.
Consolidated new awards for the three months ended March 31, 2026 totaled $0.7 billion compared to $2.0 billion for the same period in 2025. The Building and Civil segments were the primary contributors to the new awards activity in the first quarter of 2026. The most significant new awards and contract adjustments in the first quarter of 2026 included $186 million of additional funding for a hospitality and gaming project in California; $97 million of additional funding for a new healthcare project in California that entered the construction phase; $66 million of additional funding for two mass-transit projects in California;
$38Consolidated new awards for the three and six months ended June 30, 2026 totaled $1.7 billion and $2.3 billion, respectively, compared to $3.1 billion and $5.0 billion for the same periods in 2025. The decrease was merely due to the timing of project awards, as the Company continues to see strong customer demand and a robust pipeline of bidding opportunities across its end markets. The Civil segment was the primary contributor to the new awards activity in the second quarter of 2026. The most significant new awards and contract adjustments in the second quarter of 2026 included a $652 million formilitary threefacilities bridgeproject in Guam; two military facility projects in theAlaska Midwestcollectively valued at $143 million; and $25$130 million of additional funding for ana energyhealthcare facility project in BritishTexas; Columbia.a $114 million education facility project in Mississippi; and a $106 million bridge project in Minnesota. The Company has been successful in winning its share of major new project opportunities over the past several years due to a combination of its strategic bidding approach and favorable market dynamics, including limited competition in select markets for some of the larger projects. This environment, which is supported by strong public funding and demand, has allowed the Company to differentiate itself and deliver compelling proposals that align with the customer’s goals and expectations. The Company expects that this environment will continue for the foreseeable future.
Consolidated backlog as of MarchJune 31,30, 2026 was $19.8$19.9 billion, down slightly compared to $20.6 billion at the end of 2025, but up slightly compared to the$19.8 backlogbillion at the end of the first quarter of 2026, and down 6% compared to $21.1 billion at the end of the second quarter of 2025. As of MarchJune 31,30, 2026, the mix of backlog by segment was approximately 49%50% for Civil, 36%35% for Building and 15% for Specialty Contractors.
The following table presents the Company’s backlog by business segment, reflecting changes from December 31, 2025 to MarchJune 31,30, 2026:
With respect to potential concerns regarding the U.S. government’s scrutiny and curtailment of federal funding for certain projects, as well as varying new tariff policies that have been and may continue to be implemented, the Company does not currently anticipate any significant impacts to its business related to these factors. Most of the Company’s major projects are funded at the state or local level, or with some combination of federal, state and local funding. For projects that are wholly or partially funded with federal dollars, the funding for those projects has already been committed and/or those projects are strategically important to the United States. Despite this, there have recently been, and there may in the future be, occasions where even previously authorized and committed funding is withheld by the government, which could delay the progress of certain projects or the awards of new projects. The Company currently does not anticipate any material adverse impacts to its financial results as the result of such temporary project delays.
The outlook for the Company’s revenue growth over the next several years remains highly favorable due to strong new award bookings of large, long-duration projects over the past twoseveral years, as well as other new awards that are expected to be booked in the future. ForThe example,Company continues to have significant project bidding opportunities this year and beyond, particularly in the Indo-Pacific region, as well as in California, the Midwest, and the Northeast, and remains well positioned to continue winning its share of new projects. Overall, the Company's pipeline of potential projects over the next three to four years totals more than $200 billion, which is approximately three times larger than the pipeline from just a couple of years ago. Many of these prospects are expected to bid over the next one to two years. Furthermore, the Company has certain building projects in California,projects, mostly in the healthcare, education, and hospitality and gaming sectors, that are in the preconstruction phase. These projects are expected to transition from preconstruction to construction over the next few years, and they include a large, multi-billion-dollar healthcare project in California that is anticipated to be incrementally added to backlog over the next two years. Many of the Company’s newer projects are design-build projects that have an initial six-to-eighteen-monthsix- to eighteen-month design phase during which smaller revenue and earnings are generated prior to the start of a multi-year construction phase that generates substantially larger revenue and earnings. We anticipate that we will continue to win our share of significant new project awards resulting from long-term, well-funded capital spending plans by various state, local and federal customers, as well as limited competition for many of the larger project opportunities.
The Bipartisan Infrastructure Law was enacted into law in November 2021 and provided for $1.2 trillion of federal infrastructure funding, including $550 billion in new spending for improvements to the country’s surface-transportation network and enhancements to core infrastructure. The Bipartisan Infrastructure Law initiated the largest federal investment in public transit ever, the single largest dedicated bridge investment since the construction of the interstate highway system and the largest federal investment in passenger rail since the creation of Amtrak, all in addition to providing for regular annual spending for numerous infrastructure projects. This significant incremental funding is anticipated to be spent over the 10 years from its enactment through 2031, and much of it is allocated for investment in end markets that are directly aligned with our market focus. Accordingly, we believe that this significant funding has benefited, and will continue to favorably impact, our current work and prospective opportunities over the next decade.several years. While the current funding window for the Bipartisan Infrastructure Law closes on September 30, 2026, we believe that Congress recognizes the long-term nature of infrastructure workprojects. andCongress is alreadycurrently engaged in the legislative process to secure future funding beyond that date,date althoughthrough the BUILD America 250 Act (H.R. 8870), a major $580 billion bipartisan surface transportation reauthorization bill. The final amount and composition of such future funding from this bill is yet to be determined. Overall, our major projects are less reliant on federal funding provided by the Bipartisan Infrastructure Law (and its successors) than on the more substantial state and local funding that has historically supported, and is expected to continue supporting, such projects. In addition, various existing projects and future project opportunities in Guam and the Indo-Pacific region are being funded by the U.S. government’s Pacific Deterrence Initiative, which provides substantial multi-year funding to support significant improvements that enhance the U.S. military’s infrastructure and readiness. Finally, there are various large infrastructure projects across the U.S. for which future funding may be provided, in part or entirely, through public-private partnership (P3) arrangements, which would include mostly private capital investments.
To supplement our unaudited Condensed Consolidated Financial Statements presented under GAAP, we are presenting certain non-GAAP financial measures. These non-GAAP financial measures exclude items that are not reflective of ongoing business operations, including share-based compensation expense for the three and six months ended June 30, 2026 and 2025 (as well as the associated tax benefit), and for the second half of 2026, adjustments will also include certain pension settlement, debt extinguishment and refinancing costs (as well as the associated tax impacts). These non-GAAP financial measures are intended to provide additional insights that facilitate the comparison of our past and present performance, and they are among the indicators management uses to assess the Company’s financial performance and to forecast future performance. By presenting these non-GAAP financial measures, we aim to provide investors and stakeholders with a clearer understanding of our operating results and enhance transparency with respect to the key financial metrics used by our management in its financial and operational decision-making.
These non-GAAP financial measures, which exclude share-based compensation expense for the three months ended March 31, 2026 and 2025 (as well as the associated tax benefit),measures consist of adjusted net income attributable to the Company and adjusted diluted earnings per share. We exclude share-based compensation expense because this expense could result in significant volatility in our reported earnings, driven primarily by fluctuations in the expense recognized for certain long-term incentive compensation awards with payouts that are indexed to the Company’s common stock. By adjusting for share-based compensation, our non-GAAP measures present a supplemental depiction of our operational performance and financial health. This approach allows stakeholders to focus on our core operational efficiency and profitability without the variable impact to earnings caused by significant changes in our stock price. Our non-GAAP measures are intended to offer a consistent basis for evaluating the Company’s performance, which management believes is meaningful to stakeholders.
___________________________________________________________________________________________________ (a)The amount represents share-based compensation expense recorded during the three and six months ended MarchJune 31,30, 2026 and 2025. This includes expense associated with certain long-term incentive compensation awards that have payouts indexed to the Company’s common stock. As such, significant fluctuations in the price of the Company’s common stock during any reporting period have caused and could continue to cause significant fluctuations in the reported expense. The increase in the expense for the three months ended March 31, 2026 as compared to the prior-year period was driven by the Company’s stock price being substantially higher in 2026 as compared to the same period of 2025.
Revenue for the three and six months ended MarchJune 31,30, 2026 set all-time records for each respective period and increased 14.4%11.2% and 12.6%, respectively, compared to the same periodperiods in 20252025. andFor setboth aperiods newof first-quarter record for2026, the segment. The growth was primarily due to increased project execution activities on two large mass-transit projects and a tunneling project in the Northeast, bothall of which have substantial scope of work remaining.
Income from construction operations for the three months ended June 30, 2026 was $124.5 million compared to $140.1 million for the same period in 2025. The decrease for the second quarter of 2026 was primarily due to the absence of a prior-year favorable adjustment of $28.0 million related to the settlement of certain change orders, as well as changes in estimates due to improved performance on a mass-transit project in the Midwest. The decrease was mostly offset by contributions associated with the increased current-year project execution activities discussed above.
Income from construction operations for the threesix months ended MarchJune 31,30, 2026 was $87.7$212.3 million compared to $79.6$219.7 million for the same period in 2025,2025. andThe alsosix-month setperiod aof new2026 first-quarterwas recordimpacted by the same factors discussed above for the segment.second Thequarter increaseof was2026, primarilyincluding due tostrong contributions associated with the aforementioned increased project execution activities discussed above, as well as contributions from various other projects that are ramping up.activities. The improvementfirst six months of 2026 was partiallyalso offsetimpacted by an unfavorable adjustment of $16.4 million in the first quarter of 2026 on a mass-transit project in California of $16.4 millionCalifornia, primarily due to changes in estimates resulting from ongoing negotiations of change orders with the owner and subcontractors, as well as other temporary impacts related to unapproved change orders.
Operating margin was 12.6%15.3% and 14.0%, respectively, for the three and six months ended MarchJune 31,30, 2026 compared to 13.0%19.1% and 16.3% for the same periodperiods in 2025. The change in operating marginmargins was principally due to the above-mentioned factors that drove the changes in revenue and income from construction operations.
New awards and contract adjustments in the Civil segment totaled $197.0$1.0 millionbillion and $1.2 billion for the three and six months ended MarchJune 31,30, 20262026, respectively, compared to $1.5$2.2 billion and $3.7 billion for the same periodperiods in 2025. The most significant new awards and contract adjustments in the firstsecond quarter of 2026 included $66a $652 million ofmilitary additional funding for two mass-transit projects in California; $38 million for three bridge projects in the Midwest; and $25 million of additional funding for an energyfacilities project in BritishGuam Columbia.and a $106 million bridge project in Minnesota. The most significant new awards and contract adjustments in the firstsecond quarter of 2025 included the $1.18$1.87 billion ManhattanMidtown TunnelBus Terminal Replacement - Phase 1 project in New York; two civil works projects in the Midwest collectively valued at $127 million; and $241$90 million of additional funding for thea Apra Harbor Waterfront Repairsmass-transit project in Guam.California.
Backlog for the Civil segment was $9.7$9.8 billion as of MarchJune 31,30, 2026, leveldown 11.9% compared to the$11.2 backlogbillion as of MarchJune 31,30, 2025. The segment continues to experience strong demand reflected in a large, multi-year pipeline of prospective projects, and supported by substantial anticipated funding from various voter-approved state and local transportation measures, the Bipartisan Infrastructure Law, and by public agencies’ long-term spending plans. We believe that the Civil segment is well-positioned to continue capturing its share of these prospective projects later this year and over the next several years, with the majority of near-term opportunities onin the WestIndo-Pacific Coast,region, as well as in California, the Midwest, the Northeast, and the Indo-Pacific region.Northeast.
Revenue for the three months ended March 31, 2026 increased 2.9% compared to the same period in 2025.
Income from construction operationsRevenue for the three and six months ended MarchJune 31,30, 2026 wasincreased $16.321.1% millionand 12.0%, respectively, compared to $10.5 million for the same periodperiods in 2025. TheFor increaseboth periods of 2026, the growth was largelyprimarily due to contributionsincreased fromproject certainexecution newer,activities higher-marginon two large detention facility projects in New York and Californiaa withlarge substantialhealthcare facility project in California, all of which have significant scope of work remaining.
Income from construction operations for the three and six months ended June 30, 2026 was $31.3 million and $47.6 million, up 39.3% and 44.7% respectively, compared to $22.5 million and $32.9 million for the same periods in 2025. The strong increase for both periods of 2026 was primarily due to higher-margin contributions related to the increased project execution activities discussed above.
Operating margin was 3.5%5.6% and 4.6% for the three and six months ended MarchJune 31,30, 20262026, respectively, compared to 2.3%4.9% and 3.6% for the same periodperiods in 2025. The increased operating marginmargins waswere principally due to the above-mentioned factors that drove the increase in income from construction operations.
New awards and contract adjustments in the Building segment totaled $352.0$350.5 million and $702.5 million for the three and six months ended MarchJune 31,30, 20262026, respectively, compared to $142.1$664.0 million and $806.1 million for the same periodperiods in 2025. The most significant new awards and contract adjustments in the firstsecond quarter of 2026 included $186two military facility projects in Alaska collectively valued at $143 million of additional funding forand a hospitality$114 andmillion gamingeducation facility project in California and $97 million of additional funding for a new healthcare project in California that entered the construction phase.Mississippi.
Backlog for the Building segment was $7.2$7.0 billion as of MarchJune 31,30, 2026, up 8%2026 compared to $6.7$6.9 billion as of MarchJune 31,30, 2025. The Building segment continues to experience strong customer demand as reflected by a large volume of prospective projects across various end markets, including healthcare, education, transportation, industrial/manufacturing, and hospitality and gaming. In addition, there are certain healthcare, education, and hospitality and gaming projects underway in California that are in the preconstruction phase, with only a small portion of their full anticipated value included in our reported backlog. These projects are expected to transition from preconstruction to construction over the next few years, and they include a large, multi-billion-dollar healthcare project in California that is anticipated to be incrementally added to backlog over the next two years.
Revenue for the three and six months ended MarchJune 31,30, 2026 increased 23.7%47.3% and 35.5%, respectively, compared to the same periodperiods in 2025. The Specialtystrong Contractorsgrowth segmentfor continuesboth periods of 2026 was primarily due to experienceincreased strongproject revenueexecution growthactivities on various newer projects across diverse end markets, including inthe itssegment’s role in supporting the electrical and mechanical components of several of the Company's newer megaprojects,megaprojects mostand a healthcare facility in Texas. Many of whichthese projects are in the early stages and rampingare up.expected to ramp up substantially over the next few years.
Income from construction operations for the three and six months ended MarchJune 31,30, 2026 was $0.6$5.7 million and $6.3 million, respectively, compared to a loss from construction operations of $7.1$18.0 million and $25.1 million for the same periodperiods of 2025. The significant improvement for both periods of 2026 was primarily due to contributions related to the increased project execution activities discussed above.above, Manyas well as the absence of thesecertain projectsprior-year areunfavorable adjustments totaling $14.6 million related to the settlement of certain legacy claims in the earlyNortheast stages and are expected to ramp up substantially overin the nextsecond severalquarter years.of 2025, none of which were individually material.
Operating margin was 0.3%2.2% and 1.3% for the three and six months ended MarchJune 31,30, 20262026, respectively, compared to (4.010.2)% and (7.1)% for the same periodperiods in 2025. The increased operating margin wasimprovements were principally due to the aforementioned factors that drove the increaseincreases in revenue and income (loss) from construction operations.
New awards and contract adjustments in the Specialty Contractors segment totaled $121.1$309.8 million and $431.0 million for the three and six months ended MarchJune 31,30, 20262026, respectively, compared to $366.7$181.0 million and $547.7 million for the same periodperiods in 2025. The most significant new awards and contract adjustments in the second quarter of 2026 included $130 million of additional funding for a healthcare facility project in Texas.
Backlog for the Specialty Contractors segment was $3.0 billion as of MarchJune 31,30, 2026, essentially level with the$3.0 backlogbillion as of MarchJune 31,30, 2025. The Specialty Contractors segment continues to be primarily focused on servicing the Company’s current and prospective large Civil and Building segment projects, particularly in the Northeast and California. Approximately two-thirds of the segment’s backlog represents electrical and mechanical projects that are being performed for the Civil and Building segments. We believe that the segment remains well-positioned to continue capturing its share of other new projects, leveraging the strong reputation held by the business units in this segment for high-quality work on large, complex projects.
Corporate general and administrative expenses were $45.5$41.7 million and $87.2 million during the three and six months ended MarchJune 31,30, 2026, respectively, compared to $17.6$68.1 million and $85.7 million for the same periodperiods in 2025. The increasedecrease in corporate general and administrative expenses in the second quarter of 2026 compared to 2025 was primarily due to higherlower share-based compensation expense. The decrease in share-based compensation expense aswas aprimarily resultdriven by the absence of thecertain Company’sliability-classified stockawards pricethat beingvested substantially higher in 2026 compared toat the same periodend of 2025,2025. whichLiability-classified impactedawards theare remeasured at fair value at the end of liability-classifiedeach awards.reporting period with the change in fair value recognized in earnings. The Company currently projects a decrease in share-based compensation expense over the remainder of 2026 as compared to 2025, and a much more significant decrease in 2027 as certain such awards have vested and most of the remaining liability-classified awards will vest by the end of 2026. After the Company’s shareholders approved additional shares under the Plan in May 2025, the Company stopped awarding liability-classified, long-term incentive compensation awards, which will help to reduce future earnings volatility.
Other income, net, for the three and six months ended MarchJune 31,30, 2026 increased $6.0$4.6 million and $10.7 million, respectively, compared to the same periodperiods in 2025.
Interest expense for the three and six months ended June 30, 2026 increased $0.1 million and decreased $0.8 million, respectively, compared to the same periods in 2025. As a result of the refinancing of its senior notes completed on July 2, 2026, discussed further in Liquidity and Capital Resources below, the Company expects annualized cash interest expense savings of $21.0 million.
Interest expense for the three months ended March 31, 2026 decreased $1.0 million compared to the same period in 2025.
The Company recognized income tax expense of $17.0$30.8 million and $47.8 million for the three and six months ended MarchJune 31,30, 2026 resulting in an effective income tax rate of 30.1%.26.8% and 27.9%, respectively. The effective income tax rate for the three and six months ended MarchJune 31,30, 2026 was higher than the 21.0% federal statutory income tax rate primarily due to non-deductible expenses and state income taxes (net of the federal tax benefit), partially offset by earnings attributable to noncontrolling interests (for which income taxes are not the responsibility of the Company) and federal income tax credits.
The Company recognized income tax expense of $12.9$22.0 million and $34.9 million for the three and six months ended MarchJune 31,30, 2025 resulting in an effective income tax rate of 23.2%.31.8% and 28.0%, respectively. The effective income tax rate for the three and six months ended MarchJune 31,30, 2025 was higher than the 21.0% federal statutory income tax rate primarily due to non-deductible expenses and state income taxes (net of federal tax benefit), substantiallypartially offset by earnings attributable to noncontrolling interests (for which income taxes are not the responsibility of the Company) and federal income tax credits.
Liquidity is provided by available cash and cash equivalents, cash generated from operations, credit facilities and access to capital markets. We have a committed line of credit totaling $170.0 million,million as of June 30, 2026 (increased to $350.0 million effective July 2, 2026, as discussed further below in Debt), which may be used for revolving loans, letters of credit and/or general purposes. We believe that cash generated from operations, along with our unused credit capacity and available cash balances as of MarchJune 31,30, 2026, will be sufficient to fund working capital needs, dividends, share repurchases, and debt maturities for the next 12 months and beyond, as discussed further in Debt below.beyond. We generated a record amount of operating cash in the first threesix months of 2026, as discussed below in Cash and Working Capital. We expect strong annual operating cash flow to continue in the second half of 2026 and beyond, both from project execution activities and the resolution of outstanding claims and change orders. In addition, over the next two years we expect to continue to benefit from the utilization of available net operating loss carryforwards to reduce our cash outflows for income taxes. We also explore repayments or refinancings of our outstanding indebtedness and share repurchases from time to time based on our cash needs, credit strength and market conditions.
As discussed further in Debt below, as of July 2, 2026, we completed the refinancing of our senior notes and entered into an amendment and restatement of our existing revolving credit facility, which, among other things, extends debt maturities, is expected to significantly reduce future interest expense, more than doubles the size of our available revolving credit facility and provides for meaningfully improved terms.
The Company expects to refinance its outstanding debt in 2026 to secure a more favorable interest rate and extend its debt maturities, which should result in a substantially reduced interest expense going forward.
Cash and cash equivalents were $803.0$938.2 million as of MarchJune 31,30, 2026 compared to $734.6 million as of December 31, 2025. Cash immediately available for general corporate purposes was $320.9$423.5 million and $270.7 million as of MarchJune 31,30, 2026 and December 31, 2025, respectively, with the remainder being amounts held by our consolidated joint ventures and also our proportionate share of cash held by our unconsolidated joint ventures. Cash held by our joint ventures is available only for joint venture-related uses, including distributions to joint venture partners. In addition, our restricted cash and restricted investments totaled $279.7$277.8 million as of MarchJune 31,30, 2026 compared to $264.6 million as of December 31, 2025. Restricted cash and restricted investments at MarchJune 31,30, 2026 were primarily held to secure insurance-related contingent obligations and deposits.
During the threesix months ended MarchJune 31,30, 2026, net cash provided by operating activities was $146.9$334.1 million, the largest result for the first threesix months of any year. The record operating cash flow for the first threesix months of 2026 was largely driven by collectionshigher from newervolume and ongoing projects, reflecting a significant increase in projectstrong execution and improvedcollections workingon capitalprofitable management, with only an immaterial amount attributable to the resolution of disputes.projects. During the threesix months ended MarchJune 31,30, 2025, net cash provided by operating activities was $22.9$285.3 million. The net cash provided by operating activities for the 2025 period was primarily due to collectionsadvanced frompayments on newer projects for mobilization and other initial project costs.costs and collections related to dispute resolutions.
Cash flow from operating activities for the first threesix months of 2026 increased $124.0$48.9 million compared to the same period in 2025. The increase in cash flow from operating activities for the first threesix months of 2026 compared to 2025 primarily reflects a larger decrease in net project working capital in the current period compared to anthe increaseprior-year period, as well as higher cash provided by earnings sources in the prior-year2026 period. The decrease in net project working capital in the 2026 period was primarily due to a current-year decreasedecreases in accounts receivable and other current assets compared to an increaseincreases last year, partially offset by a current-year decrease in accounts payable compared to an increase in the prior-year period and a smaller current-year increase in billings in excess of costs and estimated earnings compared to the prior-year period.period and a slight increase in costs and estimated earnings in excess of billings in the current-year period compared to a decrease last year.
Net cash used in investing activities during the first threesix months of 2026 was $43.8$91.7 million primarily due to net cash used in investment transactions of $28.4 million and the acquisition of property and equipment for projects (i.e., capital expenditures) totaling $18.0$51.7 million and net cash used in investment transactions of $44.2 million. Net cash used in investing activities during the first threesix months of 2025 was $23.9$67.7 million primarily due to the acquisition of property and equipment for projects totaling $30.1$56.9 million,million partiallyand offset byother net cash providedused byin investment transactions of $5.7 million and proceeds from the sale of property and equipment of $0.5$15.0 million.
Net cash used in financing activities was $46.5$67.5 million for the first threesix months of 2026, which was primarily driven by payments of $20.0$30.0 million for the repurchase of common stock and $9.6$13.2 million for the repayment of debt. Net cash used in financing activities was $146.4$134.7 million for the first threesix months of 2025, which was primarily driven by a $129.5$116.7 million net repayment of debt, and $11.8 million of net distributions to noncontrolling interests.debt.
At MarchJune 31,30, 2026, we had working capital of $0.9$1.0 billion, a ratio of current assets to current liabilities of 1.281.29 and a ratio of debt to equity of 0.32,0.30, compared to working capital of $0.9 billion, a ratio of current assets to current liabilities of 1.27 and a ratio of debt to equity of 0.32 at December 31, 2025.
2026 Senior Notes Issuance and 2024 Senior Notes IssuanceRedemption
On AprilJuly 22,2, 2024,2026, the Company issued $400.0 million in aggregate principal amount of 11.875%6.625% Senior Notes due AprilJuly 30,15, 20292033 (the “20242026 Senior Notes”) in a private placement offering. Interest on the 20242026 Senior Notes is payable in arrears semi-annually in AprilJanuary and OctoberJuly of each year.year, beginning in January 2027.
Prior to July 15, 2029, the Company may redeem the 2026 Senior Notes at a redemption price equal to 100% of the principal amount plus a “make-whole” premium described in the indenture. In addition, prior to July 15, 2029, the Company may redeem up to 40% of the original aggregate principal amount of the notes at a redemption price of 106.625% of their principal amount with the proceeds received by the Company from any offering of the Company’s equity. The Company may redeem the 20242026 Senior Notes at redemption prices during the twelve-month periods beginning on AprilJuly 30,15, 2026,2029, AprilJuly 30,15, 20272030 and AprilJuly 30,15, 20282031 and thereafter of 108.906%,103.313%, 104.453%101.656% and 100.0%, respectively, of the principal amount being redeemed. IfUpon the Company experiences certaina change of control events,control, holders of the 20242026 Senior Notes may require the Company to repurchase all or part of the 20242026 Senior Notes at 101% of the principal amount thereof, plus accrued and unpaid interest to the redemptionrepurchase date.
The 20242026 Senior Notes are senior unsecured obligations of the Company and are guaranteed by the Company’s existing and future subsidiaries that also guarantee obligations under the Company’s 20202026 Credit Agreement.Agreement, as defined below. In addition, the indenture for the 20242026 Senior Notes provides for customary covenants on restricting certain payments and includes customary events of default.
On July 2, 2026, the proceeds of the 2026 Senior Notes, together with cash on hand, were used to redeem in full the 2024 Senior Notes. As a result, the Company will recognize debt extinguishment costs of approximately $51.4 million in the third quarter of 2026, consisting of $35.6 million for the redemption premium and $15.8 million of non-cash expense for the remaining unamortized discounts and issuance costs as of the extinguishment date. These debt extinguishment costs will be excluded from the Company’s adjusted diluted earnings per share, as discussed above in Non-GAAP Financial Measures.
2020 Credit Agreement and 2026 Credit Agreement
On August 18, 2020, the Company entered into a credit agreement (as amended, the “2020 Credit Agreement”) with BMO Bank N.A. (f/k/a BMO Harris Bank N.A.), as Administrative Agent, Swing Line Lender and L/C Issuer and other lenders. The 2020 Credit Agreement providesprovided for a $170.0 million (which was increased to $350.0 million following the effectiveness of the 2026 Credit Agreement on July 2, 2026, as described in further detail below) revolving credit facility (the “Revolver”), which matureswas set to mature on August 18, 2027, with sub-limits for the issuance of letters of credit and swing line loans up to the aggregate amounts of $75.0 million and $10.0 million, respectively. The 2020 Credit Agreement also originally provided for a $425.0 million term loan B facility (the “Term Loan B”), which was set to mature on August 18, 2027. During the first quarter of 2025, the Company voluntarily repaid the remaining $121.9 million outstanding balance of the Term Loan B.
Subject to certain exceptions, at any time prior to maturity, the 2020 Credit Agreement providesprovided the Company with the right to increase the commitments under the Revolver and/or to establish one or more term loan facilities in an aggregate amount up to (i) the greater of $173.5 million and 50% LTM EBITDA (as defined in the 2020 Credit Agreement) plus (ii) additional amounts if (A) in the case of pari passu first lien secured indebtedness, the First Lien Net Leverage Ratio (as defined in the 2020 Credit Agreement) doesdid not exceed 1.35: to 1.00, (B) in the case of junior lien secured indebtedness, the Total Net Leverage Ratio (as defined in the 2020 Credit Agreement) doesdid not exceed 3.50: to 1.00, and (C) in the case of unsecured indebtedness, (x) the Total Net Leverage Ratio doesdid not exceed 3.50: to 1.00 or (y) the Fixed Charge Coverage Ratio (as defined in the 2020 Credit Agreement) iswas no less than 2.00: to 1.00. The balances of indebtedness used in the calculations of the First Lien Net Leverage Ratio and the Total Net Leverage Ratio includeincluded offsets for cash and cash equivalents available for general corporate purposes.
As of MarchJune 31,30, 2026, the Revolver had unused available borrowing capacity of $170.0 million, and the outstanding balance of the 2024 Senior Notes was $400.0 million.
Borrowings under the 2020 Credit Agreement bearbore interest at variable rates, which have increased since the latter part of 2022 due to changes in market conditions that resulted in increases in the Secured Overnight Financing Rate (“SOFR”) and the administrative agent’s prime lending rate. The Company had no borrowings under the Revolver during the threesix months ended MarchJune 31,30, 2026. At MarchJune 31,30, 2026, the borrowing rate on the Revolver was 10.0%. For more information regarding the terms of our 2020 Credit Agreement, refer to Note 10 of the Notes to Condensed Consolidated Financial Statements.
TPC insider buying and selling (Form 4)
Since 2026-04-11, insiders reported open-market purchases in 0 Form 4 filings and open-market sales in 5 filings (4 insiders, 5 trade dates, 2,535,109 shares, about $218.9M). Net open-market shares: -2,535,109 (purchases minus sales); net value about -$218.9M.Totals add up every open-market (code P and S) line in those filings, using the prices reported in the filings. Awards, option exercises, tax withholding and gifts are listed below but not counted.
| Trade date | Insider | Transaction | Shares | Price | Value |
|---|---|---|---|---|---|
| 2026-08-31 | Tutor Ronald N |
Open-market sale | 800,000 | $85.57 | $68.5M |
| 2026-08-31 | Tutor Ronald N |
Open-market sale | 10,000 | $89.86 | $898.6K |
| 2026-08-31 | Tutor Ronald N |
Open-market sale | 1,500,000 | $85.57 | $128.4M |
| 2026-08-28 | Reiss Dale Anne |
Gift | 600 | — | — |
| 2026-08-27 | Reiss Dale Anne |
Open-market sale | 6,000 | $92.07 | $552.4K |
| 2026-08-27 | Reiss Dale Anne |
Open-market sale | 7,400 | $92.02 | $680.9K |
| 2026-08-07 | Feltenstein Sidney J |
Open-market sale | 36,487 | $97.50 | $3.6M |
| 2026-08-07 | Feltenstein Sidney J |
Open-market sale | 52,579 | $96.26 | $5.1M |
| 2026-08-07 | Feltenstein Sidney J |
Open-market sale | 32,661 | $95.66 | $3.1M |
| 2026-08-07 | Feltenstein Sidney J |
Open-market sale | 62,482 | $98.18 | $6.1M |
| 2026-06-19 | Dieu Henry |
Shares withheld for tax | 522 | $77.99 | $40.7K |
| 2026-06-19 | Dieu Henry |
Option exercise | 1,191 | — | — |
| 2026-06-19 | Jensen William E |
Option exercise | 26,203 | — | — |
| 2026-06-19 | Jensen William E |
Shares withheld for tax | 14,057 | $77.99 | $1.1M |
| 2026-06-19 | Ariqat Ghassan |
Option exercise | 26,203 | — | — |
| 2026-06-19 | Ariqat Ghassan |
Shares withheld for tax | 13,332 | $77.99 | $1.0M |
| 2026-06-17 | Oklak Dennis D |
Gift | 8,000 | — | — |
| 2026-06-17 | Oklak Dennis D |
Gift | 4,000 | — | — |
| 2026-05-27 | Lieber Robert C |
Open-market sale | 17,500 | $75.36 | $1.3M |
| 2026-05-27 | Lieber Robert C |
Gift | 7,500 | — | — |
| 2026-05-20 | Oneglia Raymond R |
Grant/award | 2,337 | — | — |
| 2026-05-20 | Reiss Dale Anne |
Gift | 36,340 | — | — |
| 2026-05-20 | Reiss Dale Anne |
Grant/award | 2,337 | — | — |
| 2026-05-20 | Reiss Dale Anne |
Gift | 36,340 | — | — |
| 2026-05-20 | Feltenstein Sidney J |
Grant/award | 3,635 | — | — |
| 2026-05-20 | Shah Shahrokh |
Grant/award | 2,337 | — | — |
| 2026-05-20 | Jigisha Desai |
Grant/award | 3,992 | — | — |
| 2026-05-20 | Oklak Dennis D |
Grant/award | 2,337 | — | — |
| 2026-05-20 | Arkley Peter |
Grant/award | 2,337 | — | — |
| 2026-05-20 | Lieber Robert C |
Grant/award | 2,337 | — | — |
| 2026-05-19 | Lieber Robert C |
Open-market sale | 10,000 | $74.25 | $742.5K |
Well-known investors holding TPC (13F)
| Investor | Quarter | Shares | Reported value | % of their 13F | Change vs prior quarter |
|---|---|---|---|---|---|
| Renaissance Technologies | 2026-06-30 | 800,280 | $66.4M | 0.09% | Reduced 4% |
| AQR Capital Management (Cliff Asness) | 2026-06-30 | 378,624 | $31.4M | 0.01% | Reduced 12% |
| Millennium Management (Israel Englander) | 2026-06-30 | 268,897 | $22.3M | 0.02% | Reduced 22% |
| Two Sigma Investments | 2026-06-30 | 171,200 | $14.2M | 0.01% | Reduced 60% |
| D. E. Shaw & Co. | 2026-06-30 | 91,956 | $7.6M | 0.0% | Added 163% |
| Citadel Advisors (Ken Griffin) | 2026-06-30 | 90,572 | $7.5M | 0.0% | Reduced 50% |
| Gotham Asset Management (Joel Greenblatt) | 2026-06-30 | 56,974 | $4.7M | 0.01% | Reduced 21% |
| Point72 Asset Management (Steve Cohen) | 2026-06-30 | 24,637 | $2.0M | 0.0% | Added 58% |