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QUANTA SERVICES, INC. (PWR)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 2024 delivered record-scale results: revenue $6.55B, GAAP diluted EPS $2.03, adjusted diluted EPS $2.94, adjusted EBITDA $737.8M, free cash flow $575.4M; year-end total backlog rose to $34.54B and RPO to $16.76B .
  • Management issued FY2025 guidance calling for double‑digit growth: revenue $26.6–$27.1B, GAAP EPS $6.85–$7.45, adjusted EPS $9.90–$10.50, EBITDA $2.49–$2.62B, adjusted EBITDA $2.66–$2.80B, CFO $1.70–$2.25B, FCF $1.20–$1.70B .
  • Electric segment operating margin improved (13.1% in Q4) and Renewable segment ended at all‑time high backlog; Underground margins softened, but management expects improvement in 2025 with industrial recovery and accretive M&A .
  • Structural catalysts: accelerating data center/AI power demand, large transmission programs, and fiber build wins (e.g., Lumen long-haul fiber award selection) should support continued backlog growth and multi‑year EPS expansion .

What Went Well and What Went Wrong

What Went Well

  • Record financial outputs in Q4: revenue $6.55B, adjusted EPS $2.94, FCF $575.4M, year‑end backlog $34.54B and RPO $16.76B; Renewable segment backlog reached all‑time highs .
  • Electric Power Infrastructure Solutions operating margin expanded to 13.1% in Q4 (vs 10.5% prior year), reflecting execution and portfolio strength .
  • CFO emphasized cash flow outperformance: “our cash flow in the fourth quarter and for the full year exceeded the upper end of our free cash flow guidance expectations” .
  • CEO tone on secular tailwinds: “accelerating demand for power and infrastructure solutions… Quanta stands as a critical partner in building the future of energy and technology” .

What Went Wrong

  • Underground Utility & Infrastructure Solutions margins compressed to 3.6% in Q4 (vs 6.6% prior year), with storm-related shifts and industrial timing in 2H impacting mix; management targets improvement in 2025 .
  • Non‑GAAP reconciling items were elevated: amortization expense $115.8M in Q4 and $383.0M for FY2024; foreign currency translation losses tied to Latin American liquidation affected results .
  • S&P Global consensus estimates could not be retrieved during this session; beat/miss vs Street cannot be assessed at this time (see Estimates Context) [GetEstimates errors].

Financial Results

Quarterly progression (Q2 → Q3 → Q4 2024)

MetricQ2 2024Q3 2024Q4 2024
Revenue ($USD Millions)$5,594.4 $6,493.2 $6,553.4
GAAP Diluted EPS ($)$1.26 $1.95 $2.03
Adjusted Diluted EPS ($)$1.90 $2.72 $2.94
Adjusted EBITDA ($USD Millions)$523.2 $682.8 $737.8
Cash from Operations ($USD Millions)$391.3 $739.9 $712.0
Free Cash Flow ($USD Millions)$258.6 $539.5 $575.4

Year-over-year comparison (Q4 2024 vs Q4 2023)

MetricQ4 2023Q4 2024
Revenue ($USD Millions)$5,783.9 $6,553.4
GAAP Diluted EPS ($)$1.42 $2.03
Adjusted Diluted EPS ($)$2.04 $2.94
Consolidated Operating Margin (%)5.6% 6.9%
Adjusted EBITDA ($USD Millions)$550.2 $737.8

Segment breakdown (Q4)

SegmentRevenue Q4 2023 ($MM)Revenue Q4 2024 ($MM)Operating Income Q4 2023 ($MM)Operating Income Q4 2024 ($MM)Operating Margin Q4 2023Operating Margin Q4 2024
Electric Power Infrastructure Solutions$2,456.1 $3,405.0 $258.0 $445.2 10.5% 13.1%
Renewable Energy Infrastructure Solutions$2,026.0 $1,975.5 $179.7 $208.0 8.9% 10.5%
Underground Utility & Infrastructure Solutions$1,301.9 $1,172.9 $85.4 $42.6 6.6% 3.6%
Corporate & Non-Allocated Costs——($200.6) ($243.1) (3.5%) (3.7%)
Consolidated$5,783.9 $6,553.4 $322.5 $452.7 5.6% 6.9%

KPIs (Backlog and RPO)

MetricDec 31, 2023Sep 30, 2024Dec 31, 2024
Total RPO ($USD Billions)$13.89 $15.61 $16.76
Total Backlog ($USD Billions)$30.11 $33.96 $34.54

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY 2025N/A$26.6B–$27.1B New issuance
Net Income (GAAP)FY 2025N/A$1.04B–$1.13B New issuance
GAAP Diluted EPSFY 2025N/A$6.85–$7.45 New issuance
Adjusted Diluted EPSFY 2025N/A$9.90–$10.50 New issuance
EBITDAFY 2025N/A$2.49B–$2.62B New issuance
Adjusted EBITDAFY 2025N/A$2.66B–$2.80B New issuance
Net Cash from OperationsFY 2025N/A$1.70B–$2.25B New issuance
Free Cash FlowFY 2025N/A$1.20B–$1.70B New issuance
Dividend per share (quarterly)Nov 2024 declaration$0.09 (prior)$0.10 (+11%) Raised
Segment reportingFrom Q1 20253 segments2 segments: Electric Infrastructure Solutions; Underground Utility & Infrastructure Solutions Recast segments

Note: Prior FY2025 guidance was not previously provided publicly; this is initial issuance for 2025 .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q4 2024)Trend
AI/data centers demandEmphasis on Cupertino acquisition expanding TAM; tech load growth driving renewables; solution-based approach “Demand is firm” with >50–100GW generation commitments; solutions across utilities and hyperscalers; expect larger awards in 2025 Strengthening
Large transmission buildRecord bid activity; utility/RTO planning ramping; long HV constraints & need to start now RTO plans increasing; backlog expected to reach record levels; multi‑year stacking of large projects (‘26–‘28) Strengthening
Supply chain (transformers)Acquired transformer manufacturing asset to mitigate constraints; TS Conductor strategic investment Constraints persist; U.S.-based manufacturing derisks critical path; cross-sell with PTT assets Persistent constraints; mitigation actions
Regulatory/macroElection noise but tech backstop; affordability vs grid hardening; Canada receivable collection timing Permit progress (e.g., SunZia execution on track); DOE anchor tenant projects helpful; focus on ratepayer impacts and grid congestion relief Cautiously constructive
Undergrounding/wildfiresHardening programs; storm work shifts; LDC budget migration to electric California undergrounding progressing despite cost; resilience programs continue; watch fire risk Continuing, expected to expand
Telecom/fiberCommunications ~$1B base, prudently managed; not a primary growth driver Lumen long-haul fiber award; incremental growth from data center fiber demand Improving
M&A integrationCupertino performing at high end of $1.0–$1.1B 2024 revenue range; synergies like Blattner 2025 inorganic contribution captured in guidance; civil solutions (U.S.) and Australia tech acquisitions ($562.1M consideration) Accretive; synergy ramp
Cash flowFree cash flow conversion strengthening; DSO improvements Q4 and FY FCF exceeded guidance; 2025 FCF guided $1.2–$1.7B Strong and improving

Management Commentary

  • CEO: “Our portfolio strength, execution discipline and customer-focused approach are driving consistent, profitable growth… Looking ahead, we expect another year of strong performance in 2025, including double-digit growth in revenue, adjusted EBITDA and earnings per share” .
  • CFO: “Quanta completed the year with fourth quarter revenues of $6.6 billion… adjusted diluted earnings per share of $2.94. Adjusted EBITDA was $737.8 million… free cash flow of $575.4 million” .
  • CEO on backlog and larger projects: “I expect our backlog to be at record levels… I fully expect us to book larger projects” .
  • CEO on SunZia: “We’re progressing well… we’ve already replaced it in backlog… not concerned at all with our ability to replace SunZia” .
  • CEO on transformer constraints: “It hasn’t gotten any better… our supply chain steps help move projects forward” .

Q&A Highlights

  • Electric segment margins: Management targets 10.5–11% framework with potential to exceed; double-digit despite reduced storm vs 2024 .
  • Backlog trajectory: Expect record levels and larger project awards across RTOs; timing of awards ramping into 2025 .
  • Renewable momentum: Bookings robust; safe harbor actions by sophisticated customers support multi‑year pipeline; fastest time‑to‑power via solar .
  • Underground margins: 2024 softness from industrial storms and mix; 2025 expected improvement with industrial recovery and LDC capital returning .
  • Telecom/fiber: Lumen long‑haul win underscores data center fiber demand; communications business growing “nicely” .

Estimates Context

  • Wall Street consensus (S&P Global Capital IQ) for Q4 2024 EPS and revenue was unavailable during retrieval due to API limits; therefore, beat/miss vs Street cannot be assessed in this recap. Values would ordinarily be sourced from S&P Global and compared to reported results; investors should refer to S&P Global for consensus benchmarks when available.

Key Takeaways for Investors

  • Secular demand for power (AI/data centers) and grid modernization supports multi‑year growth; management guides double‑digit EPS and adjusted EBITDA growth in 2025 with backlog poised for records .
  • Execution remains strong: Electric margins expanded, adjusted EPS rose to $2.94, and FCF exceeded guidance, underpinning balance sheet flexibility for continued capital deployment .
  • Renewable backlog at all‑time highs and SunZia replacement already reflected; bookings and safe harbor dynamics suggest durable multi‑year pipeline .
  • Supply chain mitigation (transformers) and segment reorganization (two segments from Q1 2025) should enhance delivery speed and investor transparency on converging markets (electric + renewables + tech/comm) .
  • Near‑term watch items: Underground margin recovery path, timing of large transmission awards across RTOs, and continued fiber build momentum (e.g., Lumen) .
  • With estimates unavailable here, focus on underlying trend lines: YoY expansion in revenue, EPS, margins, and backlog provides constructive setup into 2025 .