DYCOM INDUSTRIES INC

Previous wording

Demand for high-speed broadband connectivity is expanding, driven by data-intensive applications and mobile usage, necessitating extensive wireline network upgrades and extensions, new and expanding fiber infrastructure for data centers, and advanced wireless network deployments. This widespread need for expanded and enhanced connectivity fuels significant opportunities within the digital infrastructure sector. Our relationships, national footprint, and ability to manage increasing complexity differentiate us and we are confident in our ability to capitalize on industry opportunities.

Current wording

Demand for high-speed and low-latency connectivity is expanding, driven by data-intensive applications and mobile usage, necessitating extensive wireline network upgrades and extensions, new and expanding fiber infrastructure for data centers to meet the current and future needs of AI, and advanced wireless network deployments. This widespread need for expanded and enhanced connectivity fuels significant opportunities within the digital infrastructure sector. Our relationships, national footprint, and ability to manage increasing complexity differentiate us and we are confident in our ability to capitalize on industry opportunities.

Previous wording

Our strategy centers on our core maintenance and operations services and capitalizes on key drivers. These include multi-year fiber-to-the-home deployments in throughout the United States, increasing fiber infrastructure builds to support hyperscaler data center growth, continued state and federal program spending to bridge the digital divide, wireless network modernization programs to meet increasing digital demands, and the expansion of core maintenance and operations services.

Current wording

Our strategy centers on our core maintenance and operations services which provide a strong foundation to capitalize on other drivers of demand for telecommunications and digital infrastructure. These include multi-year fiber-to-the-home deployments throughout the United States, increasing fiber infrastructure builds to support hyperscaler data center growth, continued state and federal program spending to bridge the digital divide and wireless network modernization programs to meet increasing digital demands.

Previous wording

The cyclical nature of the industry we serve affects demand for our services. The capital expenditure and maintenance budgets of our customers, and the related timing of approvals and seasonal spending patterns, influence our contract revenues and results of operations. Factors affecting our customers and their capital expenditure budgets include, but are not limited to, overall economic conditions, the introduction of new technologies, our customers’ debt levels and capital structures, our customers’ financial performance, our customers’ positioning and strategic plans. Other factors that may affect our customers and their capital expenditure budgets include the availability of state and federal funding, the implementation or enforcement of regulations or regulatory actions impacting our customers’ businesses, merger or acquisition activity involving our customers, and the physical maintenance needs of our customers’ infrastructure.

Current wording

The cyclical nature of the industry we serve affects demand for our services, and our contract revenues and results of operations exhibit seasonality as a significant portion of our work is performed outdoors. The capital expenditure and maintenance budgets of our customers, and the related timing of approvals and seasonal spending patterns, influence our contract revenues and results of operations. Factors affecting our customers and their capital expenditure budgets include, but are not limited to, overall economic conditions, the introduction of new technologies, our customers’ debt levels and capital structures, our customers’ financial performance, our customers’ positioning and strategic plans. Other factors that may affect our customers and their capital expenditure budgets include the availability of state and federal funding, the implementation or enforcement of regulations or regulatory actions impacting our customers’ businesses, merger or acquisition activity involving our customers, and the physical maintenance needs of our customers’ infrastructure.

Previous wording

Our customer base is highly concentrated. The following reflects the percentage of total contract revenues from customers who contributed at least 10% to our total contract revenues during the three months ended April 26, 2025 or April 27, 2024:

Current wording

Our customer base is highly concentrated. The following reflects the percentage of total contract revenues from customers who contributed at least 10% to our total contract revenues during the three and six months ended July 26, 2025 or July 27, 2024:

Previous wording

As part of our growth strategy, we may acquire companies that expand, complement, or diversify our business. We regularly review opportunities and periodically engage in discussions regarding possible acquisitions. Our ability to sustain our growth and maintain our competitive position may be affected by our ability to identify, acquire, and successfully integrate companies.

Current wording

As part of our growth strategy, we have and may continue to acquire companies that expand, complement, or diversify our business. We regularly review opportunities and periodically engage in discussions regarding possible acquisitions. Our ability to sustain our growth and maintain our competitive position may be affected by our ability to identify, acquire, and successfully integrate companies.

Previous wording

Fiscal 2025. During the third quarter of fiscal 2025, we acquired certain assets and assumed certain liabilities of a telecommunications construction contractor for a cash purchase price of $150.7 million. The acquired business provides wireless construction services for telecommunications providers in various states. This acquisition expands our geographic presence within our existing customer base. The purchase price allocation for this business is preliminary and will be completed when the valuation for intangible assets and other amounts are finalized within the 12-month measurement period from the date of the acquisition.

Current wording

Fiscal 2025. During the third quarter of fiscal 2025, we acquired certain assets and assumed certain liabilities of a telecommunications construction contractor for a cash purchase price of $150.7 million. The acquired business provides wireless construction services for telecommunications providers in various states. This acquisition expands our geographic presence within our existing customer base.

Previous wording

For certain contracts, representing less than 5% of contract revenues during each of the three months ended April 26, 2025 and April 27, 2024, we use the cost-to-cost measure of progress. These contracts are generally projects that are completed over a period of less than twelve months. Under the cost-to-cost measure of progress, the extent of progress toward completion is measured based on the ratio of costs incurred to date to the total estimated costs. Contract costs include direct labor, direct materials, and subcontractor costs, as well as an allocation of indirect costs. Contract revenues are recorded as costs are incurred. We accrue the entire amount of a contract loss, if any, at the time the loss is determined to be probable and can be reasonably estimated.

Current wording

For certain contracts, representing less than 5% of contract revenues during each of the six months ended July 26, 2025 and July 27, 2024, we use the cost-to-cost measure of progress. These contracts are generally projects that are completed over a period of less than twelve months. Under the cost-to-cost measure of progress, the extent of progress toward completion is measured based on the ratio of costs incurred to date to the total estimated costs. Contract costs include direct labor, direct materials, and subcontractor costs, as well as an allocation of indirect costs. Contract revenues are recorded as costs are incurred. We accrue the entire amount of a contract loss, if any, at the time the loss is determined to be probable and can be reasonably estimated.

Previous wording

Contract Revenues. Contract revenues were $1.259 billion during the three months ended April 26, 2025 compared to $1.142 billion during the three months ended April 27, 2024. Contract revenues from acquired businesses were $111.9 million and $3.4 million for the three months ended April 26, 2025 and April 27, 2024, respectively. Acquired revenues represent contract revenues from acquired businesses that were not owned for the full period in both the current and comparable prior periods.

Current wording

Contract Revenues. Contract revenues were $1.378 billion during the three months ended July 26, 2025 compared to $1.203 billion during the three months ended July 27, 2024. Contract revenues from acquired businesses were $139.8 million and $5.7 million for the three months ended July 26, 2025 and July 27, 2024, respectively. Acquired revenues represent contract revenues from acquired businesses that were not owned for the full period in both the current and comparable prior periods. Excluding amounts generated by the acquired businesses, contract revenues increased by $40.9 million during the three months ended July 26, 2025 compared to the three months ended July 27, 2024, primarily due to net revenue increases in fiber-to-the-home deployments, including rural fiber deployment programs.

Previous wording

The percentage of our contract revenues by customer type from telecommunications, underground facility locating, and electric and gas utilities and other customers, was 91.3%, 6.5%, and 2.2%, respectively, for the three months ended April 26, 2025 compared to 89.9%, 7.1%, and 3.0%, respectively, for the three months ended April 27, 2024.

Current wording

The percentage of our contract revenues by customer type from telecommunications, underground facility locating, and electric and gas utilities and other customers, was 92.1%, 6.1%, and 1.8%, respectively, for the three months ended July 26, 2025 compared to 90.3%, 6.8%, and 2.9%, respectively, for the three months ended July 27, 2024.

Previous wording

Excluding amounts generated by the acquired businesses, contract revenues increased by $7.7 million during the three months ended April 26, 2025 compared to the three months ended April 27, 2024, primarily due to net revenue increases in fiber-to-the-home deployments, including rural fiber deployment programs.

Current wording

Contract revenues were $2.637 billion during the six months ended July 26, 2025 compared to $2.345 billion during the six months ended July 27, 2024. Contract revenues from acquired businesses were $256.6 million and $13.5 million for the six months ended July 26, 2025 and July 27, 2024, respectively. Excluding amounts generated by the acquired businesses, contract revenues increased by $48.0 million during the six months ended July 26, 2025 compared to the six months ended July 27, 2024, primarily due to net revenue increases in fiber-to-the-home deployments, including rural fiber deployment programs.

Previous wording

Costs of Earned Revenues. Costs of earned revenues increased to $1.011 billion, or 80.3% of contract revenues, during the three months ended April 26, 2025 compared to $921.6 million, or 80.7% of contract revenues, during the three months ended April 27, 2024. The primary components of the increase were an $82.4 million aggregate increase in direct labor and subcontractor costs, a $5.6 million increase in other direct costs, and a $3.4 million increase in direct materials expense, offset by a $1.9 million decrease in equipment and fuel costs.

Current wording

Costs of Earned Revenues. Costs of earned revenues increased to $1.070 billion, or 77.7% of contract revenues, during the three months ended July 26, 2025 compared to $952.9 million, or 79.2% of contract revenues, during the three months ended July 27, 2024. The primary components of the increase were an $89.9 million aggregate increase in direct labor and subcontractor costs, a $15.2 million increase in direct materials expense, a $12.1 million increase in other direct costs, and a $0.3 million increase in equipment and fuel costs.

Previous wording

Costs of earned revenues as a percentage of contract revenues decreased 0.3% during the three months ended April 26, 2025 compared to the three months ended April 27, 2024. Labor and subcontracted labor costs increased 0.6% primarily due to the mix of work performed during the three months ended April 26, 2025. Direct material costs decreased 0.2% primarily as a result of our mix of work in which we provide materials for customers. Equipment and fuel costs decreased 0.5% and other direct costs decreased by 0.2% on a net basis as a percentage of contract revenues for the three months ended April 26, 2025 compared to the three months ended April 27, 2024.

Current wording

Costs of earned revenues as a percentage of contract revenues decreased 1.5% during the three months ended July 26, 2025 compared to the three months ended July 27, 2024. Labor and subcontracted labor costs decreased 1.6% primarily due to the mix of work performed during the three months ended July 26, 2025. Direct material costs increased 0.5% primarily as a result of our mix of work in which we provide materials for customers. Equipment and fuel costs decreased 0.5% and other direct costs increased by 0.1% on a net basis as a percentage of contract revenues for the three months ended July 26, 2025 compared to the three months ended July 27, 2024.

Previous wording

General and Administrative Expenses. General and administrative expenses increased to $103.7 million, or 8.2% of contract revenues, during the three months ended April 26, 2025 compared to $94.6 million, or 8.3% of contract revenues, during the three months ended April 27, 2024. The increase in total general and administrative expenses during the three months ended April 26, 2025 is mainly attributable to an increase in administrative, payroll, performance based compensation and other costs, including incremental general and administrative expenses from the acquired businesses.

Current wording

General and Administrative Expenses. General and administrative expenses increased to $106.8 million, or 7.8% of contract revenues, during the three months ended July 26, 2025 compared to $99.6 million, or 8.3% of contract revenues, during the three months ended July 27, 2024. The increase in total general and administrative expenses during the three months ended July 26, 2025 is mainly attributable to an increase in administrative, payroll, performance based compensation and other costs, including incremental general and administrative expenses from the acquired businesses.

Previous wording

Depreciation and Amortization. Depreciation expense was $46.4 million, or 3.7% of contract revenues, during the three months ended April 26, 2025 compared to $39.4 million, or 3.4% of contract revenues, during the three months ended April 27, 2024. The increase in depreciation expense during the three months ended April 26, 2025 is primarily due to higher capital expenditures to support our growth in operations, the normal replacement cycle of fleet assets, and depreciation from acquired businesses.

Current wording

Depreciation and Amortization. Depreciation expense was $48.9 million, or 3.6% of contract revenues, during the three months ended July 26, 2025 compared to $40.7 million, or 3.4% of contract revenues, during the three months ended July 27, 2024. Depreciation expense was $95.3 million, or 3.6% of contract revenues, during the six months ended July 26, 2025 compared to $80.0 million, or 3.4% of contract revenues, during the six months ended July 27, 2024. The increase in depreciation expense during the three and six months ended July 26, 2025 is primarily due to higher capital expenditures to support our growth in operations, the normal replacement cycle of fleet assets, and depreciation from acquired businesses.

Previous wording

Amortization expense was $12.0 million and $5.8 million during the three months ended April 26, 2025 and April 27, 2024, respectively. The increase in amortization expense during the three months ended April 26, 2025 is due to the increase in amortizing intangibles from acquired businesses.

Current wording

Amortization expense was $11.9 million and $5.9 million during the three months ended July 26, 2025 and July 27, 2024, respectively and $23.9 million and $11.8 million during the six months ended July 26, 2025 and July 27, 2024, respectively. The increase in amortization expense during the three and six months ended July 26, 2025 is due to the increase in amortizing intangibles from acquired businesses.

Previous wording

Interest Expense, Net. Interest expense, net was $14.0 million and $12.8 million during the three months ended April 26, 2025 and April 27, 2024, respectively, as a result of higher outstanding borrowings during the current period and lower interest income on invested cash balances.

Current wording

Interest Expense, Net. Interest expense, net was $15.6 million and $14.7 million during the three months ended July 26, 2025 and July 27, 2024, respectively, as a result of higher outstanding borrowings during the current period.

Previous wording

Other Income, Net. Other income, net was $7.3 million and $9.3 million during the three months ended April 26, 2025 and April 27, 2024, respectively. Gain on sale of fixed assets, net was $9.8 million and $12.4 million during the three months ended April 26, 2025 and April 27, 2024, respectively. The change in other income, net is primarily a function of the number of assets sold and prices obtained for those assets during each respective period. Other income, net also reflects $3.6 million and $2.9 million of expense during the three months ended April 26, 2025 and April 27, 2024 respectively, associated with the non-recourse sale of accounts receivable under a customer-sponsored vendor payment program.

Current wording

Other Income, Net. Other income, net was $6.8 million and $6.4 million during the three months ended July 26, 2025 and July 27, 2024, respectively and $14.1 million and $15.7 million during the six months ended July 26, 2025 and July 27, 2024, respectively. Gain on sale of fixed assets, net was $10.1 million and $8.2 million during the three months ended July 26, 2025 and July 27, 2024, respectively and $19.9 million and $20.6 million during the six months ended July 26, 2025 and July 27, 2024, respectively. The change in other income, net is primarily a function of the number of assets sold and prices obtained for those assets during each respective period. Other income, net also reflects $4.2 million and $3.0 million of expense during the three months ended July 26, 2025 and July 27, 2024 respectively, and $7.8 million and $5.9 million during the six months ended July 26, 2025 and July 27, 2024, respectively, associated with the non-recourse sale of accounts receivable under a customer-sponsored vendor payment program.

Previous wording

Income Taxes. The following table presents our income tax provision and effective income tax rate for the three months ended April 26, 2025 and April 27, 2024 (dollars in millions):

Current wording

Income Taxes. The following table presents our income tax provision and effective income tax rate for the three and six months ended July 26, 2025 and July 27, 2024 (dollars in millions):

Previous wording

Our effective income tax rate was 22.3% and 19.2% for the three months ended April 26, 2025 and April 27, 2024, respectively. The interim income tax provisions are based on the effective income tax rate expected to be applicable for the full fiscal year, adjusted for specific items that are required to be recognized in the period in which they occur. The effective tax rate differs from the statutory rate primarily due to the difference in income tax rates from state to state where work was performed, non-deductible and non-taxable items, tax credits recognized, the tax effects of the vesting and exercise of share-based awards, and changes in unrecognized tax benefits. Deferred tax assets and liabilities are based on the enacted tax rate that will apply in future periods when such assets and liabilities are expected to be settled or realized.

Current wording

Our effective income tax rate was 25.7% and 27.9% for the three months ended July 26, 2025 and July 27, 2024, respectively, and 24.4% and 24.0% for the six months ended July 26, 2025 and July 27, 2024, respectively. The interim income tax provisions are based on the effective income tax rate expected to be applicable for the full fiscal year, adjusted for specific items that are required to be recognized in the period in which they occur. The effective tax rate differs from the statutory rate primarily due to the difference in income tax rates from state to state where work was performed, non-deductible and non-taxable items, tax credits recognized, the tax effects of the vesting and exercise of share-based awards, and changes in unrecognized tax benefits. Deferred tax assets and liabilities are based on the enacted tax rate that will apply in future periods when such assets and liabilities are expected to be settled or realized.

Previous wording

Net Income. Net income was $61.0 million for the three months ended April 26, 2025 compared to $62.6 million for the three months ended April 27, 2024.

Current wording

Net Income. Net income was $97.5 million for the three months ended July 26, 2025 compared to $68.4 million for the three months ended July 27, 2024. Net income was $158.5 million for the six months ended July 26, 2025 compared to $131.0 million for the six months ended July 27, 2024.

Previous wording

Non-GAAP Adjusted EBITDA. Adjusted EBITDA is a Non-GAAP measure, as defined by Regulation G of the SEC. We define Adjusted EBITDA as net income before interest, taxes, depreciation and amortization, gain on sale of fixed assets, stock-based compensation expense, and certain non-recurring items. Management believes Adjusted EBITDA is a helpful measure for comparing the Company’s operating performance with prior periods as well as with the performance of other companies with different capital structures or tax rates. The following table provides a reconciliation of net income to Non-GAAP Adjusted EBITDA (dollars in thousands):

Current wording

Non-GAAP Adjusted EBITDA. Adjusted EBITDA is a Non-GAAP measure, as defined by the rules of the SEC. We define Adjusted EBITDA as net income before interest, taxes, depreciation and amortization, gain on sale of fixed assets, stock-based compensation expense, and certain non-recurring items. Management believes Adjusted EBITDA is a helpful measure for comparing the Company’s operating performance with prior periods as well as with the performance of other companies with different capital structures or tax rates. The following table provides a reconciliation of net income to Non-GAAP Adjusted EBITDA (dollars in millions):

Previous wording

We are subject to concentrations of credit risk relating primarily to our cash and equivalents, accounts receivable, and contract assets. Cash and equivalents primarily include balances on deposit with banks and totaled $16.1 million as of April 26, 2025 compared to $92.7 million as of January 25, 2025. We maintain our cash and equivalents at financial institutions we believe to be of high credit quality. For all periods presented, we have not experienced any loss or lack of access to cash in our operating accounts.

Current wording

We are subject to concentrations of credit risk relating primarily to our cash and equivalents, accounts receivable, and contract assets. Cash and equivalents primarily include balances on deposit with banks and totaled $28.5 million as of July 26, 2025 compared to $92.7 million as of January 25, 2025. We maintain our cash and equivalents at financial institutions we believe to be of high credit quality. For all periods presented, we have not experienced any loss or lack of access to cash in our operating accounts.

Previous wording

Sources of Cash. Our sources of cash are operating activities, long-term debt, equity offerings, bank borrowings, proceeds from the sale of idle and surplus equipment and real property, and stock option proceeds. Cash flow from operations is primarily influenced by demand for our services and operating margins, but can also be influenced by working capital needs associated with the services that we provide. In particular, working capital needs may increase when we have growth in operations and where project costs, primarily associated with labor, subcontractors, equipment, and materials, are required to be paid before the related customer balances owed to us are invoiced and collected. Our working capital (total current assets less total current liabilities, excluding the current portion of debt) was $1,207.9 million as of April 26, 2025 compared to $1,117.5 million as of January 25, 2025.

Current wording

Sources of Cash. Our sources of cash are operating activities, long-term debt, equity offerings, bank borrowings, proceeds from the sale of idle and surplus equipment and real property, and stock option proceeds. Cash flow from operations is primarily influenced by demand for our services and operating margins, but can also be influenced by working capital needs associated with the services that we provide. In particular, working capital needs may increase when we have growth in operations and where project costs, primarily associated with labor, subcontractors, equipment, and materials, are required to be paid before the related customer balances owed to us are invoiced and collected. Our working capital (total current assets less total current liabilities, excluding the current portion of debt) was $1,346.2 million as of July 26, 2025 compared to $1,117.5 million as of January 25, 2025.

Previous wording

Sufficiency of Capital Resources. We believe that our capital resources, including existing cash balances and amounts available under our Credit Agreement, are sufficient to meet our financial obligations. These obligations include payments on our debt, working capital requirements, and the purchase of equipment at our expected level of operations for at least the next 12 months. Our capital requirements may increase to the extent we seek to grow by acquisitions that involve consideration other than our stock, experience difficulty or delays in collecting amounts owed to us by our customers, increase our working capital in connection with new or existing customer programs, or we repurchase our common stock, or repay Credit Agreement borrowings. Changes in financial markets or other components of the economy could adversely impact our ability to access the capital markets, in which case we would expect to rely on a combination of available cash and our Credit Agreement to provide short-term funding. Management regularly monitors the financial markets and assesses general economic conditions for possible impact on our financial position. We believe our cash investment policies are prudent and expect that any volatility in the capital markets would not have a material impact on our cash investments.

Current wording

Sufficiency of Capital Resources. We believe that our capital resources, including existing cash balances and amounts available under our Credit Agreement, are sufficient to meet our financial obligations. These obligations include payments on our debt, working capital requirements, and the purchase of equipment at our expected level of operations for at least the next 12 months. Our capital requirements may increase to the extent we seek to grow by acquisitions that involve consideration other than our stock, experience difficulty or delays in collecting amounts owed to us by our customers, increase our working capital in connection with new or existing customer programs, repurchase our common stock, or repay Credit Agreement borrowings. Changes in financial markets or other components of the economy could adversely impact our ability to access the capital markets, in which case we would expect to rely on a combination of available cash and our Credit Agreement to provide short-term funding. Management regularly monitors the financial markets and assesses general economic conditions for possible impact on our financial position. We believe our cash investment policies are prudent and expect that any volatility in the capital markets would not have a material impact on our cash investments.

Previous wording

Net Cash Flows. The following table presents our net cash flows for the three months ended April 26, 2025 and April 27, 2024 (dollars in millions):

Current wording

Net Cash Flows. The following table presents our net cash flows for the six months ended July 26, 2025 and July 27, 2024 (dollars in millions):

Previous wording

Cash used in Operating Activities. Depreciation and amortization, non-cash lease expense, stock-based compensation, amortization of debt issuance costs, deferred income taxes, gain on sale of fixed assets and recovery of bad debt were the primary non-cash items in cash flows from operating activities during the current and prior periods.

Current wording

Cash Provided by (Used in) Operating Activities. Depreciation and amortization, non-cash lease expense, stock-based compensation, amortization of debt issuance costs, deferred income taxes, gain on sale of fixed assets, loss on debt extinguishment and provision for (recovery of) bad debt were the primary non-cash items in cash flows from operating activities during the current and prior periods.

Previous wording

During the three months ended April 26, 2025, net cash used in operating activities was $54.0 million. Changes in working capital (excluding cash) and changes in other long-term assets and liabilities used $186.1 million of operating cash flow during the three months ended April 26, 2025. Changes that used operating cash flow during the three months ended April 26, 2025 included an increase in accounts receivable, in contract assets, net, in other current assets and inventories, and in other assets of $154.1 million, $20.1 million, $16.5 million and $11.7 million, respectively and a decrease in accrued liabilities, net of $42.0 million. Changes that provided cash flow during the three months ended April 26, 2025 included an increase in accounts payable and a net increase in income taxes payable of $40.9 million and $17.4 million, respectively.

Current wording

During the six months ended July 26, 2025, net cash provided by operating activities was $3.5 million. Changes in working capital (excluding cash) and changes in other long-term assets and liabilities used $335.7 million of operating cash flow during the six months ended July 26, 2025. Changes that used operating cash flow during the six months ended July 26, 2025 included an increase in accounts receivable, in income taxes receivables, in contract assets, net, in other assets, and in other current assets and inventories of $216.0 million, $63.5 million, $59.9 million, $23.6 million, and $7.1 million, respectively and a decrease in accrued liabilities, net of $15.2 million. Changes that provided cash flow during the six months ended July 26, 2025 included an increase in accounts payable of $49.6 million.

Previous wording

Days sales outstanding (“DSO”) is calculated based on the ending balance of total current and non-current accounts receivable (including unbilled accounts receivable), net of the allowance for credit losses, and current contract assets, net of contract liabilities, divided by the average daily revenue for the most recently completed quarter. Our DSO was 111 as of April 26, 2025 compared to 110 as of April 27, 2024.

Current wording

Days sales outstanding (“DSO”) is calculated based on the ending balance of total current and non-current accounts receivable (including unbilled accounts receivable), net of the allowance for credit losses, and current contract assets, net of contract liabilities, divided by the average daily revenue for the most recently completed quarter. Our DSO was 108 as of July 26, 2025 compared to 117 as of July 27, 2024.

Previous wording

During the three months ended April 27, 2024, net cash used in operating activities was $37.4 million. Changes in working capital (excluding cash) and changes in other long-term assets and liabilities used $153.2 million of operating cash flow during the three months ended April 27, 2024. Changes that used operating cash flow during the three months ended April 27, 2024 included an increase in accounts receivable, a decrease in accrued liabilities, and a decrease in accounts payable of $126.2 million, $18.0 million, $15.4 million, respectively. In addition, changes that used operating cash flow during the three months ended April 27, 2024 included an increase in other current assets and inventories of $8.1 million. Changes that provided operating cash flow during the three months ended April 27, 2024 included an increase in income taxes payable, a decrease in contract assets, net, and a decrease in other assets of $10.2 million, $2.2 million, and $2.2 million, respectively.

Current wording

During the six months ended July 27, 2024, net cash used in operating activities was $44.9 million. Changes in working capital (excluding cash) and changes in other long-term assets and liabilities used $280.9 million of operating cash flow during the six months ended July 27, 2024. Changes that used operating cash flow during the six months ended July 27, 2024 included an increase in accounts receivable, an increase in contract assets, net, and a decrease in income taxes payable of $256.5 million, $26.3 million, and $7.0 million, respectively. In addition, changes that used operating cash flow during the six months ended July 27, 2024 included an increase in other current assets and inventories of $2.9 million. Changes that provided operating cash flow during the six months ended July 27, 2024 included an increase in accounts payable, an increase in accrued liabilities, and a decrease in other assets of $8.8 million, $2.6 million, and $0.3 million, respectively.

Previous wording

Cash Used in Investing Activities. Net cash used in investing activities was $68.6 million during the three months ended April 26, 2025 compared to $42.2 million during the three months ended April 27, 2024. During the three months ended April 26, 2025 and April 27, 2024, capital expenditures were $79.5 million and $42.0 million, respectively, and cash paid for acquisitions during the three months ended April 27, 2024 was $13.0 million. These expenditures were offset in part by proceeds from the sale of assets of $10.9 million and $12.7 million during the three months ended April 26, 2025 and April 27, 2024, respectively.

Current wording

Cash Used in Investing Activities. Net cash used in investing activities was $107.7 million during the six months ended July 26, 2025 compared to $119.0 million during the six months ended July 27, 2024. During the six months ended July 26, 2025 and July 27, 2024, capital expenditures were $131.2 million and $107.4 million, respectively, and cash paid for acquisitions during the six months ended July 27, 2024 was $33.8 million. These expenditures were offset in part by proceeds from the sale of assets of $23.5 million and $22.2 million during the six months ended July 26, 2025 and July 27, 2024, respectively.

Previous wording

Cash Provided by Financing Activities. Net cash provided by financing activities was $45.9 million during the three months ended April 26, 2025. During the three months ended April 26, 2025, borrowings and repayments under our Credit Agreement were $285.0 million and $196.0 million, respectively. In addition, we repurchased 200,000 shares of our common stock in open market transactions, at an average price of $150.93 per share, for $30.2 million, during the three months ended April 26, 2025. We also paid $12.9 million, net to tax authorities in order to meet the payroll tax withholding obligations on restricted share units that vested during the three months ended April 26, 2025.

Current wording

Cash Provided by Financing Activities. Net cash provided by financing activities was $39.9 million during the six months ended July 26, 2025. During the six months ended July 26, 2025, borrowings and repayments under our Credit Agreement were $629.0 million and $544.0 million, respectively. In addition, we repurchased 200,000 shares of our common stock in open market transactions, at an average price of $150.93 per share, for $30.2 million, during the six months ended July 26, 2025. We also paid $13.0 million, net to tax authorities in order to meet the payroll tax withholding obligations on restricted share units that vested during the six months ended July 26, 2025. In addition, we paid $1.9 million, net, to tax authorities for payroll tax withholding obligations on the exercise of stock options.

Previous wording

Net cash provided by financing activities was $4.7 million during the three months ended April 27, 2024. During the three months ended April 27, 2024, borrowings and repayments under our Credit Agreement were $120.0 million and $69.4 million, respectively. We repurchased 210,000 shares of our common stock in open market transactions, at an average price of $141.84 per share, for $29.8 million, during the three months ended April 27, 2024. We also paid $16.3 million to tax authorities in order to meet the payroll tax withholding obligations on restricted share units that vested during the three months ended April 27, 2024. This was partially offset by the exercise of stock options, which provided $0.1 million during the three months ended April 27, 2024.

Current wording

Net cash provided by financing activities was $82.3 million during the six months ended July 27, 2024. During the six months ended July 27, 2024, borrowings and repayments under our Credit Agreement were $282.4 million and $147.4 million, respectively. We paid approximately $6.6 million in issuance costs and third party fees and expenses related to our financing transactions. In addition, we repurchased 210,000 shares of our common stock in open market transactions, at an average price of $141.84 per share, for $29.8 million, during the six months ended July 27, 2024. We also paid $16.3 million to tax authorities in order to meet the payroll tax withholding obligations on restricted share units that vested during the six months ended July 27, 2024. This was partially offset by the exercise of stock options, which provided $0.1 million during the six months ended July 27, 2024.

Previous wording

Our Credit Agreement contains a financial covenant that requires us to maintain a consolidated net leverage ratio of not greater than 3.50 to 1.00 as measured at the end of each fiscal quarter, and provides for certain increases to this ratio in connection with permitted acquisitions. The consolidated net leverage ratio is the ratio of our consolidated indebtedness reduced by unrestricted cash and cash equivalents in excess of $25.0 million to our trailing four-quarter consolidated earnings before interest, taxes, depreciation, and amortization as defined by our Credit Agreement. The Credit Agreement also contains a financial covenant that requires us to maintain a consolidated interest coverage ratio, which is the ratio of our trailing four-quarter consolidated EBITDA to our consolidated interest expense, each as defined by our Credit Agreement, of not less than 3.00 to 1.00, as measured at the end of each fiscal quarter. At April 26, 2025 and January 25, 2025, we were in compliance with the financial covenants of our Credit Agreement and had borrowing availability under our revolving facility of $513.5 million and $602.5 million, respectively, as determined by the most restrictive covenant. For calculation purposes, applicable cash on hand is netted against the funded debt amount as permitted in the Credit Agreement.

Current wording

Our Credit Agreement contains a financial covenant that requires us to maintain a consolidated net leverage ratio of not greater than 3.50 to 1.00 as measured at the end of each fiscal quarter, and provides for certain increases to this ratio in connection with permitted acquisitions. The consolidated net leverage ratio is the ratio of our consolidated indebtedness reduced by unrestricted cash and cash equivalents in excess of $25.0 million to our trailing four-quarter consolidated earnings before interest, taxes, depreciation, and amortization as defined by our Credit Agreement. The Credit Agreement also contains a financial covenant that requires us to maintain a consolidated interest coverage ratio, which is the ratio of our trailing four-quarter consolidated EBITDA to our consolidated interest expense, each as defined by our Credit Agreement, of not less than 3.00 to 1.00, as measured at the end of each fiscal quarter. At July 26, 2025 and January 25, 2025, we were in compliance with the financial covenants of our Credit Agreement and had borrowing availability under our revolving facility of $517.5 million and $602.5 million, respectively, as determined by the most restrictive covenant. For calculation purposes, applicable cash on hand is netted against the funded debt amount as permitted in the Credit Agreement.

Previous wording

Performance and Payment Bonds and Guarantees. We have obligations under performance and other surety contract bonds related to certain of our customer contracts. Performance bonds generally provide a customer with the right to obtain payment and/or performance from the issuer of the bond if we fail to perform our contractual obligations. We had $440.0 million and $413.5 million of outstanding performance and other surety contract bonds, as of April 26, 2025 and January 25, 2025, respectively. The estimated cost to complete projects secured by our outstanding performance and other surety contract bonds was approximately $230.4 million as of April 26, 2025. In addition to performance and other surety contract bonds, as part of our insurance program we also provide surety bonds that collateralize our obligations to our insurance carriers. At each of April 26, 2025 and January 25, 2025, we had $31.0 million of outstanding surety bonds related to our insurance obligations. Additionally, we have periodically guaranteed certain obligations of our subsidiaries, including obligations in connection with obtaining state contractor licenses and leasing real property and equipment.

Current wording

Performance and Payment Bonds and Guarantees. We have obligations under performance and other surety contract bonds related to certain of our customer contracts. Performance bonds generally provide a customer with the right to obtain payment and/or performance from the issuer of the bond if we fail to perform our contractual obligations. We had $431.6 million and $413.5 million of outstanding performance and other surety contract bonds, as of July 26, 2025 and January 25, 2025, respectively. The estimated cost to complete projects secured by our outstanding performance and other surety contract bonds was approximately $227.7 million as of July 26, 2025. In addition to performance and other surety contract bonds, as part of our insurance program we also provide surety bonds that collateralize our obligations to our insurance carriers. At each of July 26, 2025 and January 25, 2025, we had $31.0 million of outstanding surety bonds related to our insurance obligations. Additionally, we have periodically guaranteed certain obligations of our subsidiaries, including obligations in connection with obtaining state contractor licenses and leasing real property and equipment.

Previous wording

Our backlog is an estimate of the uncompleted portion of services to be performed under contractual agreements with our customers and totaled $8.127 billion and $7.760 billion at April 26, 2025 and January 25, 2025, respectively. We expect to complete 57.6% of the April 26, 2025 total backlog during the next twelve months. Our backlog represents an estimate of services to be performed pursuant to master service agreements and other contractual agreements over their terms. These estimates are based on contract terms and evaluations regarding the timing of the services to be provided. In the case of master service agreements, backlog is estimated based on the work performed in the preceding twelve month period, when applicable. When estimating backlog for newly initiated master service agreements and other long and short-term contracts, we also consider the anticipated scope of the contract and information received from the customer during the procurement process and, where applicable, other ancillary information. The majority of our backlog comprises services under master service agreements and other long-term contracts.

Current wording

Our backlog is an estimate of the uncompleted portion of services to be performed under contractual agreements with our customers and totaled $7.989 billion and $7.760 billion at July 26, 2025 and January 25, 2025, respectively. We expect to complete 57.6% of the July 26, 2025 total backlog during the next twelve months. Our backlog represents an estimate of services to be performed pursuant to master service agreements and other contractual agreements over their terms. These estimates are based on contract terms and evaluations regarding the timing of the services to be provided. In the case of master service agreements, backlog is estimated based on the work performed in the preceding twelve month period, when applicable. When estimating backlog for newly initiated master service agreements and other long and short-term contracts, we also consider the anticipated scope of the contract and information received from the customer during the procurement process and, where applicable, other ancillary information. The majority of our backlog comprises services under master service agreements and other long-term contracts.