Primoris cuts 2026 profit forecast even as Q3 profit tops estimates

Primoris Services (PRIM) said on Nov. 3 that third-quarter adjusted earnings were $1.20 per diluted share, topping the $0.79 consensus estimate. Revenue of $1.95 billion fell short of the $2.04 billion estimate and was down from $2.18 billion a year earlier.

Shares were little changed in regular trading as of 9:47 a.m. ET on Nov. 4, from a regular-session close of $79.57.

The company also updated its full-year 2026 guidance and announced a new share purchase program of up to $250 million.

Here's how the company did:

• Adjusted EPS: $1.20 vs. $1.88 a year earlier, $0.79 expected
• Diluted EPS: 95 cents vs. $1.73 a year earlier
• Revenue: $1.95 billion vs. $2.18 billion a year earlier, $2.04 billion expected
• Net income: $51.3 million vs. $94.6 million a year earlier
• Adjusted EBITDA: $134.4 million vs. $168.7 million a year earlier

Operating income was $94.9 million, a decrease of $42.1 million, or 30.7%, from the same period in 2025. Gross profit as a percentage of revenue fell to 10.5% from 10.8%.

Interest expense, net, rose to $14.3 million from $7.0 million. The company said the increase was primarily due to higher average debt and accounts receivable securitization facility balances.

Renewables weigh on Energy

Energy revenue fell $261.9 million, or 17.6%, as renewable energy activity declined. The company said new projects started more slowly than anticipated.

Energy gross margin fell to 8.5% from 10.1%. The company attributed this mainly to the lagging effect of completing renewables projects that experienced operational challenges.

Utilities revenue rose $33.4 million, or 4.5%, and its gross margin reached 13.0%, up from 11.7%.

CEO Koti Vadlamudi, President and Chief Executive Officer of Primoris, said the company is close to the end of a difficult stretch. “As the last of our six previously discussed challenged projects moves closer to completion, we are increasingly confident that these impacts are soon to be behind us and that Primoris is well positioned to capitalize on the significant opportunities ahead.”

2026 guidance

The company now expects 2026 net income of $65.2 million to $73.2 million, or $1.20 to $1.35 per diluted share. Its August 6 release had given a net income range of $71.0 million to $101.0 million.

Adjusted EPS is now forecast at $2.10 to $2.25 per diluted share, from the $2.05 to $2.60 range it gave on Aug. 6. Adjusted EBITDA is now expected at $290.0 million to $310.0 million, from $275 million to $325 million.

The company expects interest expense, net, of $43 million to $47 million for the full year. It expects an effective tax rate of approximately 33.0%, against the 30% to 32.0% it gave in August, though the rate may vary with its state mix.

Backlog, cash and capital returns

Total backlog reached a record $14.1 billion at Sept. 30, including $8.5 billion of master service agreement backlog. Utilities backlog was about $8.1 billion and Energy backlog was $6.0 billion.

The company had $203.5 million of unrestricted cash and cash equivalents at Sept. 30. In the third quarter it bought back 1,330,627 shares for $100.0 million, at a weighted average price of $75.15 per share, and it had repurchased the full $150.0 million authorized under its legacy program by that date.

The board authorized the new $250 million program on Oct. 30. It has no expiration date. The board also declared a cash dividend of 8 cents per share, payable on or about Jan. 15, 2027 to holders of record on Dec. 31, 2026.

According to its SEC filings, net income fell in each of the last three quarters, from $94.6 million in the third quarter of 2025 to a loss of $24.2 million in the second quarter of 2026.