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Primoris Services Corp (PRIM)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 delivered record revenue and earnings, with revenue $2.178B and diluted EPS $1.73; Adjusted EPS $1.88 and Adjusted EBITDA $168.7M, while gross margin compressed to 10.8% from 12.0% YoY due to mix and lower project closeouts .
  • Significant beat vs consensus: revenue beat by ~$335M, Adjusted EPS beat by ~$0.53, and EBITDA beat by ~$26M; strong execution and renewables progress pulled forward revenue from Q4/2026 into Q3 and YTD * *.
  • Guidance raised: FY25 EPS to $4.75–$4.95, Adjusted EPS to $5.35–$5.55, Adjusted EBITDA to $510–$530M; interest expense reduced to $30–$32M; tax rate ~28.5%; capex increased to $110–$130M .
  • Backlog fell sequentially ~$430M to ~$11.1B on timing of energy awards, offset by Utilities MSA strength; management flagged high-confidence energy awards in coming quarters; Utilities backlog reached an all‑time high near $6.6B .
  • Call catalysts: data center power generation pipeline (Q4 booked >$600M with another ~$600M imminent; Q4 energy revenue ~ $1.2B), utilities margin/volume tailwinds, and pipeline tailwinds developing for 2026 .

What Went Well and What Went Wrong

What Went Well

  • “Primoris had another great quarter, once again delivering record revenue, operating income, and earnings” (David King), underpinned by double‑digit growth in both segments and strong cash generation (Q3 CFO: cash from ops >$180M; YTD >$327M) .
  • Renewables outpaced expectations by >$400M in the quarter and >$900M YTD, driving Energy segment revenue +47% YoY; industrial (gas generation) up >$100M YoY on strong execution .
  • Utilities backlog rose to nearly $6.6B all‑time high; power delivery had its best revenue quarter in recent years; communications benefited from data center‑tied EPC/network builds and broadband .

What Went Wrong

  • Gross margins fell to 10.8% vs 12.0% YoY as Energy margins declined on fewer project closeouts and pipeline revenue/margins weakness; Utilities margins were lower on reduced storm work vs 2024 .
  • Total backlog declined sequentially ~$430M as fixed Energy backlog dipped on higher revenue burn and delayed bookings from tariff/OB3 noise pushing awards 3–6 months right; management views decline as temporary .
  • Weather impacted certain renewables projects (costs up) and pipeline jobs; pipeline margins were a drag, with some residual margin leakage expected in Q4 as projects burn off .

Financial Results

Consolidated results vs prior periods

MetricQ3 2024Q1 2025Q2 2025Q3 2025
Revenue ($USD Millions)$1,649.1 $1,648.1 $1,890.7 $2,178.4
Net Income ($USD Millions)$58.4 $44.2 $84.3 $94.6
Diluted EPS ($USD)$1.07 $0.81 $1.54 $1.73
Adjusted EPS ($USD)$1.22 $0.98 $1.68 $1.88
Gross Margin %12.0% 10.4% 12.3% 10.8%
Operating Income ($USD Millions)$99.6 $70.4 $126.6 $137.0
Operating Margin %6.0% 4.3% 6.7% 6.3%
Adjusted EBITDA ($USD Millions)$127.7 $99.4 $154.8 $168.7
SG&A ($USD Millions)$98.1 $99.5 $104.5 $97.7
SG&A as % of Revenue5.9% 6.0% 5.5% 4.5%

Q3 2025 actual vs Wall Street consensus

MetricConsensusActual
Revenue ($USD Millions)$1,843.4*$2,178.4
Primary EPS ($USD)$1.354*$1.88
EBITDA ($USD Millions)$135.7*$161.8

Values retrieved from S&P Global.*

Segment performance (Q3 2025 vs Q3 2024)

SegmentRevenue ($USD Millions)Gross Margin %Operating Income ($USD Millions)
Utilities (Q3’25)$737.5 11.7% $55.2
Utilities (Q3’24)$666.2 13.1% $57.3
Energy (Q3’25)$1,485.7 10.1% $108.6
Energy (Q3’24)$1,010.9 11.0% $74.2

KPIs and balance sheet/backlog

KPIQ3 2025
Total Backlog ($USD Billions)$11.06
Utilities Backlog ($USD Billions)$6.59
Energy Backlog ($USD Billions)$4.47
Cash and Equivalents ($USD Millions)$431.4
Total Liquidity ($USD Millions)$746.0
Capex (Q3) ($USD Millions)$34.5
Net Interest Expense (Q3) ($USD Millions)$7.0
Net Debt / EBITDA (TTM) (x)0.1x
Quarterly Dividend ($/share)$0.08 (declared Oct 29, payable Jan 15, 2026)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
EPS (GAAP)FY 2025$4.40–$4.60 $4.75–$4.95 Raised
Adjusted EPSFY 2025$4.90–$5.10 $5.35–$5.55 Raised
Adjusted EBITDA ($USD Millions)FY 2025$490–$510 $510–$530 Raised
Interest Expense ($USD Millions)FY 2025$33–$37 $30–$32 Lowered
Effective Tax Rate (%)FY 2025~29% ~28.5% Lowered
Gross Capex ($USD Millions)FY 2025$100 (midpoint ~$95–$115 inferred from Q2 capex plan) $110–$130 Raised
SG&A as % of RevenueFY 2025High‑5% Mid‑ to high‑5% Maintained (narrowed)
Segment Gross Margin TargetsFY 2025Utilities 10–12%; Energy 10–12% Utilities 10–12%; Energy 10–12% Maintained
DividendQuarterly$0.08/share (declared Jul 30) $0.08/share (declared Oct 29) Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q3 2025)Trend
Data center power (gas generation)Q1: vetting ~$1B of nat gas tied to data centers; building teams; selective bidding Expect sizable awards in Q4 and into 2026; Q4 energy booked >$600M with another ~$600M imminent; Q4 energy revenue ~$1.2B; margins accretive, upper end of 10–12% Accelerating bookings and revenue visibility
Tariffs/OB3 policy noiseQ1: no material impact to 2025 solar; battery timing mitigated; contracts pass‑through costs Delayed renewables bookings 1–2 quarters; customers re‑sourcing; backlog decline viewed temporary; safe harbor ample; cadence down in 2026, normalizing 2027–2028 Near‑term timing headwinds, long‑term intact
PipelineQ2: lower pipeline activity; margins weaker Headwinds reversed; bids for large projects; potential $100–$200M revenue growth in 2026; faster “book and burn” cycle Tailwinds forming for 2026
Communications/fiberQ1: +$20M fiber loop revenue; expansion in FTTH and maintenance Targeting >$100M of EPC network builds tied to data centers; monitoring federal funds for underserved areas Broadening scope beyond FTTH
Utilities/power deliveryQ1: margin improvement; strong grid resiliency plans; rate case outcomes enabling earlier starts Best revenue quarter in recent years; backlog near $6.6B; margins lower YoY due to less storm work, but trending right Solid volume; margins normalizing without storm benefit
M&AQ1: disciplined, focus on accretive tuck‑ins (power delivery) Balance sheet strength; flexibility to add scale/services via accretive M&A; CEO transition announced (Koti Vadlamudi) Optionality improved

Management Commentary

  • “Primoris had another great quarter…delivering record revenue, operating income, and earnings” (David King) .
  • “Renewables…outpacing our expectations by over $400 million for the quarter and by over $900 million year to date” (Ken Dodgen) .
  • “We are targeting over $100 million of [data center] EPC network builds over the next few quarters” .
  • “Already booked over $600 million [Q4 energy], another $600 million should book within the next 30 days…book‑to‑bill well north of one for Q4” (Ken Dodgen) .
  • “We closed Q3 with approximately $431 million of cash and total liquidity of $746 million…paid down $100 million on our term loan…net debt‑to‑EBITDA ratio to 0.1x” (Ken Dodgen) .

Q&A Highlights

  • Bookings cadence and Q4 setup: Q4 energy booked >$600M with another ~$600M imminent; Q4 energy revenue ~ $1.2B; book‑to‑bill 1.2–1.3 possible .
  • Renewables timing/2026 cadence: 2026 growth muted vs prior plan due to booking delays; normalization expected in 2027–2028; safe harbor sufficient, no 2027 “surge” needed .
  • Pipeline outlook: bids emerging for large‑diameter projects; “book and burn” dynamics imply quick revenue conversion; potential $100–$200M 2026 pipeline revenue uplift .
  • Utilities growth durability: double‑digit top‑line growth supported by gas and communications strength; power delivery project mix growing; margins accretive as project capabilities expand .
  • Margin/tail risk clarity: weather can drag; pipeline margins drag into Q4 as projects finish; gas power margins at upper end of 10–12% range .

Estimates Context

  • Q3 2025 beat across revenue, EPS, and EBITDA: revenue $2,178.4M vs $1,843.4M*; Adjusted EPS $1.88 vs $1.354*; EBITDA $161.8M vs $135.7M* *.
  • FY 2025 consensus EPS 5.505* and EBITDA 524.7M* sit above GAAP guidance EPS $4.75–$4.95 but near Adjusted EBITDA guidance $510–$530M; the company raised guidance and lowered interest/tax assumptions, implying estimates may shift higher on earnings quality and lower financing costs *.
  • Consensus FY 2025 revenue $7,517.0M* aligns with raised renewables revenue (~$3B for 2025) and strong utilities growth, though management signaled some renewables pull‑forward and 2026 softness, suggesting potential 2026 consensus recalibration *.

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Execution tailwinds: Large Q3 beat was driven by renewables/industrial pull‑forward and strong utilities; operational leverage visible in SG&A down to 4.5% of revenue .
  • Guidance credibility: Raised EPS/Adjusted EBITDA on lower interest/tax and strong Q4 setup; watch weather and pipeline margin burn‑off for Q4 variance .
  • Data center power is the near‑term growth driver: >$600M booked plus ~$600M imminent for Q4; expect gas power awards into 2026 with accretive margins at upper end of 10–12% .
  • Renewables timing risk manageable: Delays tied to tariffs/OB3 shift bookings; safe harbor provides multi‑year runway; 2026 cadence lower, normalizing by 2027–2028 .
  • Pipeline turning positive: Bid funnel expanded to $1–$2B+; fast conversion once awarded; could add $100–$200M revenue in 2026; margin accretion as scale returns .
  • Backlog/visibility: Total backlog ~$11.1B; Utilities backlog near $6.6B all‑time high; Energy backlog to rebuild as bookings catch up—monitor Q4/Q1 awards .
  • Balance sheet optionality: Liquidity $746M, net debt/EBITDA 0.1x; capacity for accretive M&A and organic investments supporting data center, power delivery, and communications .

Additional Q3 2025 primary sources: earnings press release and 8‑K (Nov 3, 2025) –; earnings call transcript (Nov 4, 2025) –; related press releases (CEO appointment Oct 7, 2025) .