Primoris Services Q3 Earnings Call Highlights Record Revenue

Primoris Services ((PRIM)) has held its Q3 earnings call. Read on for the main highlights of the call.

Primoris Services Corporation’s recent earnings call conveyed a generally positive outlook, marked by record-breaking revenue and increased profitability. However, the optimism was somewhat tempered by challenges such as a decline in backlog, lower gross margins, and difficulties in specific segments.

Record Revenue and Earnings

Primoris reported a record revenue of nearly $2.2 billion for the third quarter of 2025, marking a significant increase of $529 million or 32% compared to the previous year. The company’s net income also saw a substantial rise, reaching $94.6 million, up 61% from the prior year.

Strong Performance in Energy Segment

The Energy segment was a standout performer, with revenue increasing by $475 million or 47%, driven by heightened activity in renewables and industrial sectors. The segment’s gross profit also rose by $38.1 million or 34.2% from the previous year, highlighting its robust contribution to the company’s overall success.

Utility Segment Growth

The Utility segment experienced a 10.7% year-over-year revenue growth, bolstered by power, gas, and communication services. Notably, Power Delivery achieved its best revenue quarter in recent years, underscoring the segment’s strong performance.

Improved Cash Flow and Debt Reduction

Primoris reported an operating cash flow of over $180 million for the third quarter, contributing to a year-to-date cash flow exceeding $327 million. This financial strength enabled the company to pay down $100 million on its term loan, reflecting a strategic focus on debt reduction.

Backlog Decline in Energy Segment

Despite the positive revenue figures, the company faced a decline in its total backlog, which stood at approximately $11.1 billion at the end of Q3, down $430 million sequentially from Q2. This decline was notably significant in the Energy segment due to higher revenue burn and delayed bookings.

Lower Gross Margins

Primoris experienced a decrease in gross margins, which fell to 10.8% for the quarter compared to 12% in the prior year. Both the Utility and Energy segments reported lower margins than the previous year, presenting a challenge for the company.

Pipeline Business Challenges

The Pipeline business encountered revenue and margin challenges, which partially offset the strong results seen in other areas. Despite emerging tailwinds, the business conditions have been difficult throughout the year.

Increased Guidance for 2025

Primoris has raised its guidance for 2025, increasing its EPS projection to $4.75 to $4.95 per share and adjusted EPS to $5.35 to $5.55 per share. The adjusted EBITDA guidance was also elevated to between $510 million and $530 million. The company anticipates robust future bookings, particularly in the Energy segment, with a book-to-bill ratio well above 1 expected for Q4.

In conclusion, Primoris Services Corporation’s earnings call highlighted a positive financial trajectory with record revenues and increased profitability. However, challenges such as backlog decline and lower gross margins present areas for improvement. The company’s forward-looking guidance remains optimistic, with raised projections for EPS and EBITDA, indicating confidence in continued growth.