Executive Summary

Record Q1 revenue of $3.87B (+12.7% y/y) and GAAP diluted EPS of $5.26; non-GAAP EPS $5.41. Both top line and earnings were driven by strength in U.S. Electrical (+42.3% y/y) and Mechanical (+10.2% y/y) Construction, aided by Miller Electric integration .
Results beat S&P Global consensus with EPS $5.41 vs $4.63* and revenue $3.87B vs $3.78B*, while EBITDA of ~$370.2M also exceeded estimates* .
RPOs reached a record $11.75B (+28.1% y/y), including ~$1.0B from Miller; data center RPOs climbed to $3.6B (+112% y/y), underpinning multi-year visibility .
Guidance: Revenue $16.1–$16.9B maintained; non-GAAP EPS low end raised by $0.40 to $22.65–$24.00; margin outlook held at 8.5%–9.2% .
Capital allocation: ~$225M Q1 buybacks and $250M revolver draw with cash at ~$577M; management emphasized sustained cash generation and disciplined M&A, noting Miller should be modestly accretive in 2025 .

What Went Well and What Went Wrong

What Went Well

Record Q1 operating income and margin; non-GAAP operating margin expanded 90 bps to 8.5% on strong execution and mix tailwinds in Electrical and Mechanical .
RPO momentum: total $11.75B, organic +17.1% y/y; data center RPOs $3.6B (+112% y/y), healthcare $1.5B (+38% y/y), manufacturing/industrial $1.1B (+31% y/y), institutional $1.25B (+21% y/y) .
Management quote on execution and productivity: “virtual design and construction… prefabrication… excellence in labor planning… delivered exceptional results” .

What Went Wrong

Industrial Services margins compressed to 1.9% (vs 5.1% a year ago) due to weather-delayed turnarounds, unabsorbed overhead, and a $4M increase in allowance for credit losses (–110 bps impact) .
U.S. Building Services revenues fell 4.9% y/y as expected site-based revenue reductions outweighed Mechanical Services strength; SG&A margin rose with lower site-based revenue without corresponding overhead cuts .
High-tech manufacturing RPOs decreased sequentially and y/y, reflecting episodic awards and phase timing; management expects future awards later in the year .

Financial Results

Consolidated Performance vs Prior Quarters and Estimates

Metric	Q3 2024	Q4 2024	Q1 2025
Revenue ($USD Billions)	$3.697	$3.770	$3.867
Diluted EPS (GAAP)	$5.80	$6.32	$5.26
Diluted EPS (Non-GAAP)	$5.80	N/A	$5.41
Operating Income ($USD Millions)	$363.5	$388.6	$318.8
Operating Margin (%)	9.8%	10.3%	8.2% (GAAP); 8.5% (non-GAAP)
Gross Profit ($USD Millions)	$734.7	$757.0	$722.7
SG&A ($USD Millions)	$371.2	$368.5	$404.0
Cash from Operations ($USD Millions)	$938.4 (9M’24)	$470.0 (Q4’24)	$108.5

Estimates vs Actuals (S&P Global)

Metric	Q3 2024	Q4 2024	Q1 2025
Revenue Consensus Mean ($USD Billions)	$3.791*	$3.807*	$3.784*
Revenue Actual ($USD Billions)	$3.697	$3.770	$3.867
Revenue Outcome	Miss	Miss	Beat
Primary EPS Consensus Mean ($)	$4.97*	$5.76*	$4.63*
EPS Actual (Non-GAAP) ($)	$5.80	$6.32	$5.41
EPS Outcome	Beat	Beat	Beat
EBITDA Consensus Mean ($USD Millions)	$351.0*	$390.5*	$328.5*
EBITDA Actual ($USD Millions)	$398.3	$424.1	$370.2
EBITDA Outcome	Beat	Beat	Beat

Values retrieved from S&P Global.*

Segment Revenue and Margin

Segment	Q3 2024 Revenue ($MM)	Q4 2024 Revenue ($MM)	Q1 2025 Revenue ($MM)
U.S. Electrical Construction & Facilities	$845.0	$933.2	$1,087.8
U.S. Mechanical Construction & Facilities	$1,662.2	$1,660.6	$1,572.6
U.S. Building Services	$796.9	$755.6	$742.6
U.S. Industrial Services	$286.4	$312.7	$359.0
U.K. Building Services	$106.4	$107.9	$105.3
Total	$3,696.9	$3,770.0	$3,867.4

Segment	Q3 2024 Op Margin	Q4 2024 Op Margin	Q1 2025 Op Margin
U.S. Electrical Construction & Facilities	14.1%	15.8%	12.5%
U.S. Mechanical Construction & Facilities	12.9%	13.3%	11.9%
U.S. Building Services	7.0%	5.4%	4.9%
U.S. Industrial Services	1.1%	3.3%	1.9%
U.K. Building Services	5.2%	4.5%	4.7%
Total Operating Margin	9.8%	10.3%	8.2% (GAAP); 8.5% (non-GAAP)

KPIs

KPI	Q3 2024	Q4 2024	Q1 2025
RPOs Total ($B)	$9.79	$10.10	$11.75
RPOs: Network & Communications ($B)	N/A	$2.8	$3.6
RPOs: Healthcare ($B)	N/A	$1.3	$1.5
RPOs: Water & Wastewater ($B)	N/A	$0.683	$0.82+
Organic RPO Growth (y/y)	N/A	N/A	+17.1%
Book-to-Bill (Organic)	N/A	N/A	1.18
Cash & Equivalents ($MM)	$1,036.8 (9/30/24)	$1,339.6 (12/31/24)	$576.7 (3/31/25)
Share Repurchases ($MM)	$405.4 (9M’24)	$489.8 (FY’24)	$224.8 (Q1’25)

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Revenues	FY 2025	$16.1B–$16.9B	$16.1B–$16.9B	Maintained
Operating Margin	FY 2025	8.5%–9.2%	8.5%–9.2%	Maintained
Non-GAAP Diluted EPS	FY 2025	$22.25–$24.00	$22.65–$24.00	Raised low end by $0.40
Effective Tax Rate Assumption	FY 2025	N/A	27.0%–27.5% (slides assumption)	Provided in slides
Dividend	Q1 2025	$0.25 declared	$0.25 paid Apr 30 to holders of record Apr 17	Regular quarterly dividend

Management clarified they “raised the low end” of EPS guidance given a strong start, while keeping the top end unchanged amid macro/tariff uncertainty and project timing considerations .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q3 2024)	Previous Mentions (Q4 2024)	Current Period (Q1 2025)	Trend
AI/Data Centers & Power	Record RPOs; shift to more geographies; quest for baseload power	Expansion into secondary markets; organic/mechanical/electrical capacity building	RPOs $3.6B; more sites, increasing megawatts; mechanical scope rising with immersive cooling	Strong, accelerating
Tariffs/Macro	Tariffs seen as LT positive via reshoring; near-term uncertainty	Tariff risk manageable via terms, supply chain planning	EPS guidance range contemplates tariffs; “manage short-term challenge”	Managed risk
High-Tech Manufacturing	Favorable mix; strong y/y in 2024	Sequential declines in RPOs; episodic awards; confidence LT	RPOs down but expect awards later this year; pharma reshoring opportunities	Near-term dip, LT positive
Building Services Mix	Aftermarket opportunities; site-based headwinds	Shift to mechanical services, margins resilient	Mechanical emphasis; site-based disciplined, 80/20 mix target	Margin-focused shift
Industrial Services Turnarounds	Gradual resumption; fall season typical	Normal season; upstream tuck-in; LT benefits from policy	Slow start due to Texas weather; margin hit; improvement expected	Recovering
Capital Allocation	Strong operating cash; buybacks ongoing	+$500M buyback authorization; Miller closed Feb 3	~$225M repurchases; revolver $250M; pipeline of M&A; Miller accretive over time	Active, balanced

Management Commentary

Strategic positioning: “Our performance reflects… proactive expansion into new geographies… productivity from VDC and prefabrication… excellence in labor planning” .
Guidance philosophy: “We are going to raise the low end… revenue guidance remains… We will manage through the tariff uncertainty… we have covered the potential impact of tariffs in our guidance” .
Data centers outlook: “Size is increasing, megawatts increasing, our content is increasing… visibility through the end of the year” .
Building Services strategy: “Mechanical services will be the emphasis… likely 80-20 mechanical/site-based by next year” .
Cash discipline: “We will earn cash flow at least at net income… best-in-class at progress billings” .

Q&A Highlights

Guidance stance: Bottom end raised; top unchanged given macro/tariff uncertainty and project timing; margins guided to at least hold versus Q1’s 8.5% adjusted level .
High-tech manufacturing: Near-term RPO softness; pharma reshoring and semis expected to reaccelerate; ~$200M inorganic net bookings in high-tech in Q1 .
Miller integration: Near-term dilutive to Electrical margin by ~100–110 bps due to amortization; neutral margins excluding amortization .
Data centers: Despite headlines of pauses, EMCOR sees more markets, larger campuses (e.g., 2,500 MW), rising mechanical scope with immersive cooling .
Capital returns: Confidence in operating cash underpins buybacks despite acquisition; Q1 operating cash flow remained strong at $108M, acknowledging typical Q1 seasonality .

Estimates Context

EMCOR delivered broad-based beats vs S&P Global consensus in Q1: revenue $3.87B vs $3.78B*, EPS $5.41 vs $4.63*, EBITDA ~$370.2M vs $328.5M* .
Prior quarters showed mixed revenue vs estimates (Q3/Q4 slight misses) but strong EPS and EBITDA beats; suggests positive estimate revisions likely for FY25 EPS and margin profile, especially with the EPS range raised .
Values retrieved from S&P Global.*

Key Takeaways for Investors

Secular exposure to data centers and healthcare continues to drive backlog and margins; record $11.75B RPOs and $3.6B in data center RPOs provide multi-quarter visibility .
Execution-led margin durability: non-GAAP margin at 8.5% with potential to hold or improve per guidance; Mechanical/Electrical segments remain margin leaders .
High-tech manufacturing softness appears transitory; pharma reshoring and expected semiconductor awards later in 2025 should support trajectory .
Building Services pivot to mechanical services enhances margin resilience while site-based exposure is prudently managed; expect less drastic revenue declines as year progresses .
Capital allocation remains balanced: integration of Miller (modest 2025 EPS accretion) plus active repurchases ($224.8M in Q1) and ample liquidity (~$980M credit capacity) .
Guidance conservatism at the top end reflects macro/project timing prudence; bottom-end raise signals confidence in underlying demand and execution .
Near-term trading: Beats on EPS/EBITDA and raised EPS floor are positive catalysts; medium-term thesis anchored by secular AI/data center power build-out, healthcare demand, and reshoring-driven manufacturing projects .

EMCOR Group, Inc. (EME)·Q1 2025 Earnings Summary