TUTOR PERINI CORP

Previous wording

The following discussion and analysis of our financial position as of September 30, 2025 and the results of our operations for the three and nine months ended September 30, 2025 should be read in conjunction with other information, including the unaudited Condensed Consolidated Financial Statements and notes included in Part I, Item 1, Financial Information, of this Quarterly Report on Form 10‑Q, the audited consolidated financial statements and accompanying notes to our Annual Report on Form 10‑K for the year ended December 31, 2024, and the information contained under the heading “Risk Factors” in our Annual Report on Form 10‑K for the year ended December 31, 2024 and in Part II, Item 1A below.

Current wording

The following discussion and analysis of our financial position as of March 31, 2026 and the results of our operations for the three months ended March 31, 2026 should be read in conjunction with other information, including the unaudited Condensed Consolidated Financial Statements and notes included in Part I, Item 1, Financial Information, of this Quarterly Report on Form 10‑Q, the audited consolidated financial statements and accompanying notes to our Annual Report on Form 10‑K for the year ended December 31, 2025, and the information contained under the heading “Risk Factors” in our Annual Report on Form 10‑K for the year ended December 31, 2025 and in Part II, Item 1A below.

Previous wording

•The impact of inclement weather conditions, disasters and other catastrophic events outside of our control on projects;

Current wording

•The impact of inclement weather conditions, disasters and other catastrophic events outside of our control;

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•Risks related to government contracts (including government shutdowns) and related procurement regulations;

Current wording

•Risks related to government contracts (including government shutdowns and funding considerations) and related procurement regulations;

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•Significant fluctuations in the market price of our common stock, which could result in substantial losses for stockholders and potentially subject us to securities litigation;

Current wording

•Significant fluctuations in the market price of our common stock, which could result in substantial losses for shareholders and potentially subject us to securities litigation;

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•Failure to meet our obligations under our debt agreements (especially in a high interest rate environment);

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•Failure to meet our obligations under our debt agreements;

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•The exertion of influence over the Company by our executive chairman due to his position and significant ownership interests; and

Current wording

•The exertion of influence over the Company by our executive chairman due to his position and significant ownership interests;

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•Impairment of our goodwill or other indefinite-lived intangible assets;

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•Impairment of goodwill or other indefinite-lived intangible assets;

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•Physical and regulatory risks related to climate change;

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•Physical and regulatory risks related to climate change; and

Previous wording

Consolidated revenue for the three and nine months ended September 30, 2025 was $1.4 billion and $4.0 billion, up 30.7% and 23.8% respectively, compared to $1.1 billion and $3.3 billion for the same periods in 2024. The Company experienced strong growth in all three segments through the first nine months of 2025 compared to the same period last year, primarily driven by increased project execution activities on certain newer, larger and higher-margin projects, all of which have significant scope of work remaining. These projects are in the early stages and are expected to ramp up substantially over the next several years. The improvement for both periods of 2025 was also due to the absence of certain prior-year unfavorable adjustments, as discussed in more detail below in Results of Segment Operations.

Current wording

Consolidated revenue for the three months ended March 31, 2026 was $1.4 billion, up 11.5% compared to $1.2 billion for the same period in 2025. The Company's revenue for the first quarter of 2026 was the highest of any first quarter since 2009, and the Civil segment's revenue was the highest of any first quarter ever. The Company experienced growth in all three segments through the first three months of 2026 compared to the same period last year, primarily driven by increased project execution activities on certain newer, larger and higher-margin projects that have significant scope of work remaining. These projects are in the early stages and are expected to ramp up substantially over the next several years.

Previous wording

Income from construction operations for both periods of 2025 was negatively impacted by a significant increase in share-based compensation expense of $42.2 million and $81.7 million, respectively, as compared to the same periods in 2024. The increase in share-based compensation expense was primarily due to a substantial increase in the Company’s stock price for both periods of 2025 as compared to the same periods of 2024, which impacted the fair value of liability-classified awards. These awards are remeasured at fair value at the end of each reporting period with the change in fair value recognized in earnings.

Current wording

Income from construction operations for the three months ended March 31, 2026 was $59.2 million compared to $65.3 million for the same period in 2025. The first three months of 2026 were positively impacted by contributions associated with the increased project execution activities discussed above. These contributions were offset by a $23.5 million increase in share-based compensation expense as compared to the first quarter of 2025. This increase was primarily due to the Company’s stock price being substantially higher in 2026 as compared to the same period of 2025, which impacted the fair value of liability-classified awards. These awards are remeasured at fair value at the end of each reporting period with the change in fair value recognized in earnings. After the Company’s shareholders approved additional shares under the Plan in May 2025, the Company stopped awarding liability-classified, long-term incentive compensation awards. The first quarter of 2026 was also impacted by an unfavorable adjustment of $16.4 million on a Civil segment mass-transit project in California primarily due to changes in estimates resulting from ongoing negotiations of change orders with the owner and subcontractors, as well as other temporary impacts related to unapproved change orders.

Previous wording

Income tax expense was $15.2 million and $50.0 million for the three and nine months ended September 30, 2025, respectively, compared to income tax benefit of $33.9 million and $19.4 million for the same periods in 2024. See Corporate, Tax and Other Matters below for a discussion of the changes in the effective tax rate.

Current wording

Income tax expense was $17.0 million for the three months ended March 31, 2026 compared to $12.9 million for the same period in 2025. See Corporate, Tax and Other Matters below for a discussion of the change in the effective tax rate.

Previous wording

Diluted earnings per common share for the three and nine months ended September 30, 2025 was $0.07 and $0.97, respectively, compared to diluted loss per common share of $1.92 and $1.61 for the same periods in 2024. Adjusted diluted earnings per common share, which is a non-GAAP financial measure and excludes share-based compensation expense (and the associated tax benefit), for the three and nine months ended September 30, 2025 was $1.15 and $3.22, respectively, compared to adjusted diluted loss per common share of $1.61 and $0.88 for the same periods in 2024. The improvement for both periods in 2025 was primarily due to the factors discussed above that resulted in the positive change in income from construction operations for such periods. Refer to the Non-GAAP Financial Measures section below for further information and a reconciliation of the Company's financial results reported under generally accepted accounting principles in the United States (“GAAP”) to the reported adjusted results.

Current wording

Diluted earnings per common share for the three months ended March 31, 2026 was $0.48 compared to $0.53 for the same period in 2025. Adjusted diluted earnings per common share, which is a non-GAAP financial measure and excludes share-based compensation expense (and the associated tax benefit), for the three months ended March 31, 2026 was $1.03 compared to $0.65 for the same period in 2025. The change in diluted earnings per common share was primarily due to the factors discussed above that resulted in the change in income from construction operations. The increase in adjusted diluted earnings per common share reflects the same factors discussed above, excluding the impact of share-based compensation expense. Refer to the Non-GAAP Financial Measures section below for further information and a reconciliation of the Company's financial results reported under generally accepted accounting principles in the United States (“GAAP”) to the reported adjusted results.

Previous wording

Consolidated new awards for the three and nine months ended September 30, 2025 totaled $2.0 billion and $7.0 billion, respectively, compared to $4.7 billion and $7.1 billion for the same periods in 2024. The Building segment was the primary contributor to the new awards activity in the third quarter of 2025. The most significant new awards and contract adjustments in the third quarter of 2025 included a healthcare facility project in California valued at approximately $1 billion; a $182 million military defense project in Guam; a $155 million education facility project in California; four mechanical projects in Florida collectively valued at $123 million; $53 million of additional funding for a mass-transit project in California; and $51 million of additional funding for another healthcare project in California. The Company has continued to be successful in winning its share of major new project opportunities due to a combination of its strategic bidding approach and favorable market dynamics, including limited competition in select markets for some of the larger projects. This environment, which is supported by strong public funding and demand, has allowed the Company to differentiate itself and deliver compelling proposals that align with the customer’s goals and expectations. The Company expects that this environment will continue for the foreseeable future.

Current wording

$38 million for three bridge projects in the Midwest; and $25 million of additional funding for an energy project in British Columbia. The Company has been successful in winning its share of major new project opportunities over the past several years due to a combination of its strategic bidding approach and favorable market dynamics, including limited competition in select markets for some of the larger projects. This environment, which is supported by strong public funding and demand, has allowed the Company to differentiate itself and deliver compelling proposals that align with the customer’s goals and expectations. The Company expects that this environment will continue for the foreseeable future.

Previous wording

Consolidated backlog as of September 30, 2025 was a record $21.6 billion, up 3% compared to the previous record backlog of $21.1 billion at the end of the second quarter of 2025 and up 54% compared to the backlog at the end of the third quarter of 2024. As of September 30, 2025, the mix of backlog by segment was approximately 49% for Civil, 36% for Building and 15% for Specialty Contractors. Backlog for the Building and Specialty Contractors segments as of September 30, 2025 also set new records.

Current wording

Consolidated backlog as of March 31, 2026 was $19.8 billion, down slightly compared to $20.6 billion at the end of 2025, but up slightly compared to the backlog at the end of the first quarter of 2025. As of March 31, 2026, the mix of backlog by segment was approximately 49% for Civil, 36% for Building and 15% for Specialty Contractors.

Previous wording

With respect to potential concerns regarding the U.S. government’s increased scrutiny and curtailment of federal funding for certain projects, as well as concerns about the recent federal government shutdown and varying new tariff policies that have been and may continue to be implemented, the Company does not currently anticipate any significant impacts to its business related to these factors. From a project funding perspective, the Company does not currently foresee any of its major projects in backlog being cancelled, delayed or defunded. Most of the Company’s major projects are funded at the state or local level, or with some combination of federal, state and local funding. For projects that are wholly or partially funded with federal dollars, the funding for those projects has already been committed and/or those projects are strategically important to the United States.

Current wording

With respect to potential concerns regarding the U.S. government’s scrutiny and curtailment of federal funding for certain projects, as well as varying new tariff policies that have been and may continue to be implemented, the Company does not currently anticipate any significant impacts to its business related to these factors. Most of the Company’s major projects are funded at the state or local level, or with some combination of federal, state and local funding. For projects that are wholly or partially funded with federal dollars, the funding for those projects has already been committed and/or those projects are strategically important to the United States. Despite this, there have recently been, and there may in the future be, occasions where even previously authorized and committed funding is withheld by the government, which could delay the progress of certain projects or the awards of new projects. The Company currently does not anticipate any material adverse impacts to its financial results as the result of such temporary project delays.

Previous wording

The outlook for the Company’s revenue growth over the next several years remains highly favorable due to strong new award bookings of large, long-duration projects over the past two years, as well as other new awards that are expected to be booked over the remainder of 2025 and beyond. For example, the Company has certain building projects in California, mostly in the healthcare sector, that are in the preconstruction phase. A few of these projects are expected to move from preconstruction to construction later this year, and others are expected to do so in 2026 and 2027. Many of the Company’s newer projects are design-build projects that have an initial design phase over the first six to eighteen months during which smaller revenue and earnings are generated prior to the start of a multi-year construction phase that generates substantially larger revenue and earnings. We anticipate that we will continue to win our share of significant new project awards resulting from long-term, well-funded capital spending plans by state, local and federal customers, as well as limited competition for many of the larger project opportunities.

Current wording

The outlook for the Company’s revenue growth over the next several years remains highly favorable due to strong new award bookings of large, long-duration projects over the past two years, as well as other new awards that are expected to be booked in the future. For example, the Company has certain building projects in California, mostly in the healthcare, education, and hospitality and gaming sectors, that are in the preconstruction phase. These projects are expected to transition from preconstruction to construction over the next few years, and they include a large, multi-billion-dollar healthcare project in California that is anticipated to be incrementally added to backlog over the next two years. Many of the Company’s newer projects are design-build projects that have an initial six-to-eighteen-month design phase during which smaller revenue and earnings are generated prior to the start of a multi-year construction phase that generates substantially larger revenue and earnings. We anticipate that we will continue to win our share of significant new project awards resulting from long-term, well-funded capital spending plans by various state, local and federal customers, as well as limited competition for many of the larger project opportunities.

Previous wording

Nationally, support for transportation-related ballot measures has remained high over the last decade. Since 2014, voters in 43 states approved 84 percent of nearly 3,000 state and local measures on general election ballots. The largest of these was in Los Angeles County, where in 2016 Measure M, a half-cent sales tax increase, was approved and is expected to generate $120 billion of funding over 40 years. Funding from this measure is supporting, and is expected to continue to support, several of the Company’s current and prospective projects. More recently, in the November 2024 elections, voters approved 77 percent of 370 transportation funding measures on state and local ballots throughout the country. These measures are expected to generate an estimated $41.4 billion in new and renewed funding for roads, bridges, rail and other infrastructure. Additionally, interest rates were lowered in the fall of 2024 and have been further reduced twice in the fall of 2025, and some economists expect continued rate reductions in 2025 and 2026, though the actual timing and extent of such rate reductions remains uncertain. Lower interest rates could support additional demand for continued general construction spending. In contrast, should interest rates rise, they could reach levels that may negatively impact demand, especially for certain types of Building segment projects that have already been experiencing such impacts, such as commercial offices and tenant improvement projects, which tend to be more economically sensitive than projects handled by our Civil segment.

Current wording

Nationally, support for transportation-related ballot measures has remained high over the last decade. Since 2014, voters in 43 states approved 84 percent of nearly 3,000 state and local measures on general election ballots. The largest of these was in Los Angeles County, where in 2016 Measure M, a half-cent sales tax increase, was approved and is expected to generate $120 billion of funding over 40 years. Funding from this measure is supporting, and is expected to continue to support, several of the Company’s current and prospective projects. More recently, in the November 2024 elections, voters approved 77 percent of 370 transportation funding measures on state and local ballots throughout the country. These measures are expected to generate an estimated $41.4 billion in new and renewed funding for roads, bridges, rail and other infrastructure.

Previous wording

The bipartisan Infrastructure Investment and Jobs Act (enacted in 2021) provides for $1.2 trillion of federal infrastructure funding, including $550 billion in new spending for improvements to the country’s surface-transportation network and enhancements to core infrastructure. The law initiated the largest federal investment in public transit ever, the single largest dedicated bridge investment since the construction of the interstate highway system and the largest federal investment in passenger rail since the creation of Amtrak, all in addition to providing for regular annual spending for numerous infrastructure projects. The Company anticipates that this significant incremental funding will continue to be allocated through the end of 2026 with the funds spent over the 10 years from the law’s enactment (through 2031), and much of the funding is allocated for investments in end markets that are directly aligned with the Company’s market focus. The Company believes that Congress is working on continuation funding for various critical infrastructure programs through annual appropriations and extensions. Accordingly, the significant level of sustained funding has benefited, and should continue to favorably impact, the Company’s current work and prospective opportunities over the next decade.

Current wording

The Bipartisan Infrastructure Law was enacted into law in November 2021 and provided for $1.2 trillion of federal infrastructure funding, including $550 billion in new spending for improvements to the country’s surface-transportation network and enhancements to core infrastructure. The Bipartisan Infrastructure Law initiated the largest federal investment in public transit ever, the single largest dedicated bridge investment since the construction of the interstate highway system and the largest federal investment in passenger rail since the creation of Amtrak, all in addition to providing for regular annual spending for numerous infrastructure projects. This significant incremental funding is anticipated to be spent over the 10 years from its enactment through 2031, and much of it is allocated for investment in end markets that are directly aligned with our market focus. Accordingly, we believe that this significant funding has benefited, and will continue to favorably impact, our current work and prospective opportunities over the next decade. While the current funding window for the Bipartisan Infrastructure Law closes on September 30, 2026, we believe that Congress recognizes the long-term nature of infrastructure work and is already engaged in the legislative process to secure future funding beyond that date, although the amount and composition of such future funding is yet to be determined. In addition, various existing projects and future project opportunities in Guam and the Indo-Pacific region are being funded by the U.S. government’s Pacific Deterrence Initiative, which provides substantial multi-year funding to support significant improvements that enhance the U.S. military’s infrastructure and readiness. Finally, there are various large infrastructure projects across the U.S. for which future funding may be provided, in part or entirely, through public-private partnership (P3) arrangements, which would include mostly private capital investments.

Previous wording

To supplement our unaudited condensed consolidated financial statements presented under GAAP, we are presenting certain non-GAAP financial measures. These non-GAAP financial measures are intended to provide additional insights that facilitate the comparison of our past and present performance, and they are among the indicators management uses to assess the Company’s financial performance and to forecast future performance. By including these non-GAAP financial measures, we aim to provide investors and stakeholders a clearer understanding of our operating results and enhance transparency with respect to the key financial metrics used by our management in its financial and operational decision-making.

Current wording

To supplement our unaudited Condensed Consolidated Financial Statements presented under GAAP, we are presenting certain non-GAAP financial measures. These non-GAAP financial measures are intended to provide additional insights that facilitate the comparison of our past and present performance, and they are among the indicators management uses to assess the Company’s financial performance and to forecast future performance. By presenting these non-GAAP financial measures, we aim to provide investors and stakeholders with a clearer understanding of our operating results and enhance transparency with respect to the key financial metrics used by our management in its financial and operational decision-making.

Previous wording

These non-GAAP financial measures, which exclude share-based compensation expense for the three and nine months ended September 30, 2025 and 2024 (as well as the tax benefit associated with the expense), include adjusted net income (loss) attributable to the Company and adjusted earnings (loss) per share. We exclude share-based compensation expense because this expense could result in significant volatility in our reported earnings, driven primarily by fluctuations in the expense recognized for certain long-term incentive compensation awards with payouts that are indexed to the Company’s common stock. By adjusting for share-based compensation, our non-GAAP measures present a supplemental depiction of our operational performance and financial health. This approach allows stakeholders to focus on our core operational efficiency and profitability without the variable impact to earnings caused by significant changes in our stock price. Our non-GAAP measures are intended to offer a consistent basis for evaluating the Company’s performance, which management believes is meaningful to stakeholders.

Current wording

These non-GAAP financial measures, which exclude share-based compensation expense for the three months ended March 31, 2026 and 2025 (as well as the associated tax benefit), consist of adjusted net income attributable to the Company and adjusted earnings per share. We exclude share-based compensation expense because this expense could result in significant volatility in our reported earnings, driven primarily by fluctuations in the expense recognized for certain long-term incentive compensation awards with payouts that are indexed to the Company’s common stock. By adjusting for share-based compensation, our non-GAAP measures present a supplemental depiction of our operational performance and financial health. This approach allows stakeholders to focus on our core operational efficiency and profitability without the variable impact to earnings caused by significant changes in our stock price. Our non-GAAP measures are intended to offer a consistent basis for evaluating the Company’s performance, which management believes is meaningful to stakeholders.

Previous wording

(a)The amount represents share-based compensation expense recorded during the three and nine months ended September 30, 2025 and 2024. This includes expense associated with certain long-term incentive compensation awards that have payouts indexed to the Company’s common stock. As such, significant fluctuations in the price of the Company’s common stock during any reporting period have caused and could continue to cause significant fluctuations in the reported expense. The increase in the expense for the three and nine months ended September 30, 2025 as compared to the prior-year periods was driven by the substantial increase in the price of the Company’s stock during the 2025 periods.

Current wording

(a)The amount represents share-based compensation expense recorded during the three months ended March 31, 2026 and 2025. This includes expense associated with certain long-term incentive compensation awards that have payouts indexed to the Company’s common stock. As such, significant fluctuations in the price of the Company’s common stock during any reporting period have caused and could continue to cause significant fluctuations in the reported expense. The increase in the expense for the three months ended March 31, 2026 as compared to the prior-year period was driven bythe Company’s stock price being substantially higher in 2026 as compared to the same period of 2025.

Previous wording

Revenue and income (loss) from construction operations for the Civil segment are summarized as follows:

Current wording

Revenue and income from construction operations for the Civil segment are summarized as follows:

Previous wording

Revenue for the nine months ended September 30, 2025 increased 5.9% compared to the same period in 2024, primarily due to increased project execution activities on two large detention facility projects in New York, both of which have substantial scope of work remaining.

Current wording

Revenue for the three months ended March 31, 2026 increased 14.4% compared to the same period in 2025 and set a new first-quarter record for the segment. The growth was primarily due to increased project execution activities on two large mass-transit projects in the Northeast, both of which have substantial scope of work remaining.

Previous wording

Operating margin was 12.9% and 15.1% for the three and nine months ended September 30, 2025, respectively, compared to (2.3)% and 8.6% for the same periods in 2024. The increased operating margins were principally due to the above-mentioned factors that drove the increases in revenue and income (loss) from construction operations.

Current wording

Operating margin was 12.6% for the three months ended March 31, 2026 compared to 13.0% for the same period in 2025. The change in operating margin was principally due to the above-mentioned factors that drove the changes in revenue and income from construction operations.

Previous wording

Backlog for the Civil segment was $10.5 billion as of September 30, 2025, up 52% compared to $6.9 billion as of September 30, 2024. The segment continues to experience strong demand reflected in a large, multi-year pipeline of prospective projects, and supported by substantial anticipated funding from various voter-approved state and local transportation measures, the bipartisan Infrastructure Investment and Jobs Act, and by public agencies’ long-term spending plans. We believe that the Civil segment is well-positioned to continue capturing its share of these prospective projects, with the majority of near-term opportunities on the West Coast, in the Midwest, and in the Indo-Pacific region.

Current wording

Backlog for the Civil segment was $9.7 billion as of March 31, 2026, level compared to the backlog as of March 31, 2025. The segment continues to experience strong demand reflected in a large, multi-year pipeline of prospective projects, and supported by substantial anticipated funding from various voter-approved state and local transportation measures, the Bipartisan Infrastructure Law, and by public agencies’ long-term spending plans. We believe that the Civil segment is well-positioned to continue capturing its share of these prospective projects later this year and over the next several years, with the majority of near-term opportunities on the West Coast, in the Midwest, the Northeast, and the Indo-Pacific region.

Previous wording

Revenue and income (loss) from construction operations for the Building segment are summarized as follows:

Current wording

Revenue and income from construction operations for the Building segment are summarized as follows:

Previous wording

Operating margin was 3.4% and 3.5% for the three and nine months ended September 30, 2025 compared to (0.9)% and 1.4% for the same periods in 2024. The increased operating margins were principally due to the above-mentioned factors that drove the changes in revenue and income (loss) from construction operations.

Current wording

Operating margin was 3.5% for the three months ended March 31, 2026 compared to 2.3% for the same period in 2025. The increased operating margin was principally due to the above-mentioned factors that drove the increase in income from construction operations.

Previous wording

Backlog for the Building segment was $7.9 billion as of September 30, 2025 up 54% compared to $5.1 billion as of September 30, 2024, and set a new all-time record for the segment. The Building segment continues to experience strong customer demand as reflected by a large volume of prospective projects across various end markets and geographic locations. In addition, there are certain healthcare and education projects underway in California that are in the preconstruction phase, with only a portion of their full anticipated value included in our reported backlog. A few of these projects are expected to advance to the construction phase later this year, and others are expected to do so in 2026 and 2027. Consequently, we anticipate that we will book additional backlog for these projects during those periods.

Current wording

Backlog for the Building segment was $7.2 billion as of March 31, 2026, up 8% compared to $6.7 billion as of March 31, 2025. The Building segment continues to experience strong customer demand as reflected by a large volume of prospective projects across various end markets, including healthcare, education, transportation, industrial/manufacturing, and hospitality and gaming. In addition, there are certain healthcare, education, and hospitality and gaming projects underway in California that are in the preconstruction phase, with only a small portion of their full anticipated value included in our reported backlog. These projects are expected to transition from preconstruction to construction over the next few years, and they include a large, multi-billion-dollar healthcare project in California that is anticipated to be incrementally added to backlog over the next two years.

Previous wording

Income from construction operations for the three months ended September 30, 2025 was $6.2 million compared to a loss from construction operations of $56.9 million for the same period of 2024, marking a return to this segment’s profitability. Loss from construction operations for the nine months ended September 30, 2025 was $19.0 million compared to $83.1 million for the same period of 2024. The improvement for both periods of 2025 was primarily due to the absence of certain prior-year unfavorable adjustments that totaled $43.4 million in the aggregate on several completed projects due to the impact of judgments and settlements, including $17.7 million related to an unfavorable judgment on a completed mass-transit project in California, and certain other adjustments that were individually immaterial. The improvement for both periods of 2025 was also due to contributions related to the increased project execution activities discussed above. Many of these projects are in the early stages and are expected to ramp up substantially over the next several years.

Current wording

Income from construction operations for the three months ended March 31, 2026 was $0.6 million compared to a loss from construction operations of $7.1 million for the same period of 2025. The improvement for 2026 was primarily due to contributions related to the increased project execution activities discussed above. Many of these projects are in the early stages and are expected to ramp up substantially over the next several years.

Previous wording

Operating margin was 2.7% and (3.3)% for the three and nine months ended September 30, 2025 compared to (56.2)% and (19.4)% for the same periods in 2024. The changes in operating margin were principally due to the aforementioned factors that drove the changes in revenue and income (loss) from construction operations.

Current wording

Operating margin was 0.3% for the three months ended March 31, 2026 compared to (4.0)% for the same period in 2025. The increased operating margin was principally due to the aforementioned factors that drove the increase in revenue and income (loss) from construction operations.

Previous wording

Backlog for the Specialty Contractors segment was $3.2 billion as of September 30, 2025, up 63% compared to $2.0 billion as of September 30, 2024, and set a new all-time record for the segment. The Specialty Contractors segment continues to be primarily focused on servicing the Company’s current and prospective large Civil and Building segment projects, particularly in the Northeast and California. We believe that the segment remains well-positioned to continue capturing its share of other new projects, leveraging the strong reputation held by the business units in this segment for high-quality work on large, complex projects.

Current wording

Backlog for the Specialty Contractors segment was $3.0 billion as of March 31, 2026, essentially level with the backlog as of March 31, 2025. The Specialty Contractors segment continues to be primarily focused on servicing the Company’s current and prospective large Civil and Building segment projects, particularly in the Northeast and California. We believe that the segment remains well-positioned to continue capturing its share of other new projects, leveraging the strong reputation held by the business units in this segment for high-quality work on large, complex projects.

Previous wording

Corporate general and administrative expenses were $79.7 million and $165.4 million during the three and nine months ended September 30, 2025, respectively, compared to $32.5 million and $83.8 million for the same periods in 2024. The increase in corporate general and administrative expenses in 2025 compared to 2024 was primarily due to a substantial increase in share-based compensation expense that resulted from a higher stock price, which impacted the fair value of liability-classified awards. The Company expects share-based compensation expense to be higher than previously anticipated for the full year of 2025, but it is projected to decrease considerably in 2026 and further in 2027 once certain awards have vested. Going forward, the Company intends to issue equity-classified, rather than liability-classified, long-term incentive compensation awards, which should help to reduce future earnings volatility.

Current wording

Corporate general and administrative expenses were $45.5 million during the three months ended March 31, 2026, compared to $17.6 million for the same period in 2025. The increase in corporate general and administrative expenses in 2026 compared to 2025 was primarily due to higher share-based compensation expense as a result of the Company’s stock price being substantially higher in 2026 compared to the same period of 2025, which impacted the fair value of liability-classified awards. The Company currently projects a decrease in share-based compensation expense over the remainder of 2026 as compared to 2025, and a much more significant decrease in 2027 as certain such awards have vested and most of the remaining liability-classified awards will vest by the end of 2026. After the Company’s shareholders approved additional shares under the Plan in May 2025, the Company stopped awarding liability-classified, long-term incentive compensation awards, which will help to reduce future earnings volatility.

Previous wording

Other Income, Net, Interest Expense and Income Tax (Expense) Benefit

Current wording

Other Income, Net, Interest Expense and Income Tax Expense

Previous wording

Other income, net, for the three and nine months ended September 30, 2025 increased $3.0 million and $2.7 million, respectively, compared to the same periods in 2024.

Current wording

Other income, net, for the three months ended March 31, 2026 increased $6.0 million, compared to the same period in 2025.

Previous wording

Interest expense for the three and nine months ended September 30, 2025 decreased $7.7 million and $22.1 million compared to the same periods in 2024 primarily due to lower outstanding debt driven by the early payoff of the Term Loan B in the first quarter of 2025, as discussed further in Liquidity and Capital Resources.

Current wording

Interest expense for the three months ended March 31, 2026 decreased $1.0 million compared to the same period in 2025.

Previous wording

The Company recognized income tax expense of $15.2 million and $50.0 million for the three and nine months ended September 30, 2025 resulting in an effective income tax rate of 44.6% and 31.5%, respectively. The effective income tax rate for the three and nine months ended September 30, 2025 was higher than the 21.0% federal statutory income tax rate primarily due to non-deductible expenses and state income taxes (net of the federal tax benefit), partially offset by earnings attributable to noncontrolling interests (for which income taxes are not the responsibility of the Company) and federal income tax credits.

Current wording

The Company recognized income tax expense of $17.0 million for the three months ended March 31, 2026 resulting in an effective income tax rate of 30.1%. The effective income tax rate for the three months ended March 31, 2026 was higher than the 21.0% federal statutory income tax rate primarily due to non-deductible expenses and state income taxes (net of the federal tax benefit), partially offset by earnings attributable to noncontrolling interests (for which income taxes are not the responsibility of the Company) and federal income tax credits.

Previous wording

The Company recognized an income tax benefit of $33.9 million and $19.4 million for the three and nine months ended September 30, 2024, respectively. The effective income tax rate was 27.5% and 29.6% for the three and nine months ended September 30, 2024, respectively. The effective income tax rate for both the three and nine months ended September 30, 2024 was higher than the 21.0% federal statutory income tax rate primarily due to earnings attributable to noncontrolling interests (for which income taxes are not the responsibility of the Company) and state income taxes (net of the federal tax benefit), partially offset by non-deductible expenses.

Current wording

The Company recognized income tax expense of $12.9 million for the three months ended March 31, 2025 resulting in an effective income tax rate of 23.2%. The effective income tax rate for the three months ended March 31, 2025 was higher than the 21.0% federal statutory income tax rate primarily due to non-deductible expenses and state income taxes (net of federal tax benefit), substantially offset by earnings attributable to noncontrolling interests (for which income taxes are not the responsibility of the Company) and federal income tax credits.

Previous wording

Liquidity is provided by available cash and cash equivalents, cash generated from operations, credit facilities and access to capital markets. We have a committed line of credit totaling $170.0 million, which may be used for revolving loans, letters of credit and/or general purposes. We believe that cash generated from operations, along with our unused credit capacity and available cash balances as of September 30, 2025, will be sufficient to fund working capital needs and debt maturities for the next 12 months and beyond, as discussed further below in Debt below. During the first quarter of 2025, we voluntarily repaid the remaining $121.9 million outstanding balance of the Term Loan B. We generated a record amount of operating cash in the first nine months of 2025, as discussed below in Cash and Working Capital. We expect strong annual operating cash flow to continue well beyond 2025, both from project execution activities and the resolution of outstanding claims and change orders. In addition, we expect to continue to benefit from the utilization of available net operating loss carryforwards to reduce our cash outflows for income taxes.

Current wording

Liquidity is provided by available cash and cash equivalents, cash generated from operations, credit facilities and access to capital markets. We have a committed line of credit totaling $170.0 million, which may be used for revolving loans, letters of credit and/or general purposes. We believe that cash generated from operations, along with our unused credit capacity and available cash balances as of March 31, 2026, will be sufficient to fund working capital needs, dividends, share repurchases, and debt maturities for the next 12 months and beyond, as discussed further in Debt below. We generated a record amount of operating cash in the first three months of 2026, as discussed below in Cash and Working Capital. We expect strong annual operating cash flow to continue in 2026 and beyond, both from project execution activities and the resolution of outstanding claims and change orders. In addition, we expect to continue to benefit from the utilization of available net operating loss carryforwards to reduce our cash outflows for income taxes. We also explore repayments or refinancings of our outstanding indebtedness and share repurchases from time to time based on our cash needs, credit strength and market conditions.

Previous wording

Cash and cash equivalents were $695.7 million as of September 30, 2025 compared to $455.1 million as of December 31, 2024. Cash immediately available for general corporate purposes was $201.7 million and $265.6 million as of September 30, 2025 and December 31, 2024, respectively, with the remainder being amounts held by our consolidated joint ventures and also our proportionate share of cash held by our unconsolidated joint ventures. Cash held by our joint ventures is available only for joint venture-related uses, including distributions to joint venture partners. In addition, our restricted cash and restricted investments totaled $235.8 million as of September 30, 2025 compared to $149.1 million as of December 31, 2024. Restricted cash and restricted investments at September 30, 2025 were primarily held to secure insurance-related contingent obligations and deposits.

Current wording

Cash and cash equivalents were $803.0 million as of March 31, 2026 compared to $734.6 million as of December 31, 2025. Cash immediately available for general corporate purposes was $320.9 million and $270.7 million as of March 31, 2026 and December 31, 2025, respectively, with the remainder being amounts held by our consolidated joint ventures and also our proportionate share of cash held by our unconsolidated joint ventures. Cash held by our joint ventures is available only for joint venture-related uses, including distributions to joint venture partners. In addition, our restricted cash and restricted investments totaled $279.7 million as of March 31, 2026 compared to $264.6 million as of December 31, 2025. Restricted cash and restricted investments at March 31, 2026 were primarily held to secure insurance-related contingent obligations and deposits.

Previous wording

During the nine months ended September 30, 2025, net cash provided by operating activities was $574.4 million, the largest result for the first nine months of any year. The operating cash flow for the first nine months of 2025 is already larger than any full-year result, exceeding the previous full-year record achieved in 2024. The record operating cash flow for the first nine months of 2025 was largely driven by collections from newer and ongoing projects and, to a much lesser extent, from collections related to recent dispute resolutions. During the nine months ended September 30, 2024, net cash provided by operating activities was $174.0 million, primarily driven by collections associated with dispute resolutions.

Current wording

During the three months ended March 31, 2026, net cash provided by operating activities was $146.9 million, the largest result for the first three months of any year. The record operating cash flow for the first three months of 2026 was largely driven by collections from newer and ongoing projects, reflecting a significant increase in project execution and improved working capital management, with only an immaterial amount attributable to the resolution of disputes. During the three months ended March 31, 2025, net cash provided by operating activities was $22.9 million. The net cash provided by operating activities for the 2025 period was primarily due to collections from newer projects for mobilization and other initial project costs.