Primoris Services Corp

Dollars in millions, except share and per share amounts

Note 1—Nature of Business

Organization and operations** —**Primoris Services Corporation is a leading provider of critical infrastructure services operating mainly in the United States and Canada. We provide a wide range of construction, maintenance, replacement, and engineering services to a diversified base of customers through ourtwo segments.

We have longstanding customer relationships with solar facility developers, power producers, gas and electric utilities, refining, petrochemical, communications, midstream, downstream, and engineering companies, as well as transportation agencies across our core markets. We provide our services to a diversified base of customers, under a range of contracting options. A portion of our services are provided under Master Service Agreements (“MSA”), which are generally multi-year agreements. The remainder of our services are generated from contracts for specific construction or installation projects.

We are incorporated in the State of Delaware, and our corporate headquarters are located at 2300 N. Field Street, Suite 1900, Dallas, Texas 75201. Unless specifically noted otherwise, as used throughout these consolidated financial statements, “Primoris”, “the Company”, “we”, “our”, “us” or “its” refers to the business, operations and financial results of the Company and its wholly-owned subsidiaries.

Reportable Segments— Our current reportable segments are the Utilities segment and the Energy segment. See Note 12 – “Reportable Segments” for a brief description of the reportable segments and their operations.

The classification of revenue, gross profit, and operating income for segment reporting purposes can at times require judgment on the part of management. Our segments may perform services across industries or perform joint services for customers in multiple industries. To determine reportable segment gross profit and operating income, certain allocations, including allocations of shared and indirect costs, such as facility costs, equipment costs, selling, general, and administrative expenses (“SG&A”) and indirect operating expenses, were made.

Seasonality**—** Our results of operations are subject to quarterly variations. Some of the variation is the result of weather, particularly rain, ice, snow, and named storms, which can impact our ability to perform infrastructure services. These seasonal impacts can affect revenue and profitability in all of our businesses. Any quarter can be affected either negatively or positively by atypical weather patterns in any part of the country. In addition, demand for new projects in our Utilities segment tends to be lower during the early part of the calendar year due to clients’ internal budget cycles. As a result, we usually experience higher revenue and earnings in the second, third and fourth quarters of the year as compared to the first quarter.

Variability— Our project values range in size from several hundred dollars to several hundred million dollars. The bulk of our work is comprised of project sizes that average less than $3.0 million. We also perform large construction projects which tend not to be seasonal but can fluctuate from year to year based on customer timing, project duration, weather, and general economic conditions. Our business may be affected by declines or delays in new projects or by client project schedules. Because of the cyclical nature of some of our business, the financial results for any period may fluctuate from prior periods, and our financial condition and operating results may vary from quarter to quarter. Results from one quarter may not be indicative of financial condition or operating results for any other quarter or for an entire year.

Note 2—Summary of Significant Accounting Policies

Basis of presentation**—**The accompanying consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) and the financial statement rulesand regulations of the Securities and Exchange Commission (“SEC”). References for Financial Accounting Standards Board (“FASB”) standards are made to the FASB Accounting Standards Codification (“ASC”).

Principles of consolidation**—**The accompanying Consolidated Financial Statements include the accounts of Primoris and our wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation.

Reclassification**—**Certain previously reported amounts have been reclassified to conform to the current year presentation.

Restricted cash**—**Restricted cash consists primarily of cash balances that are restricted as to withdrawal or usage and contract retention payments made by customers into escrow bank accounts and are included in prepaid expenses and other current assets in our Consolidated Balance Sheets. Escrow cash accounts are released to us by customers as projects are completed in accordance with contract terms. The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the Consolidated Balance Sheets to the totals of such amounts shown in the Consolidated Statements of Cash Flows (in millions):

Use of estimates**—**The preparation of our Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting periods. As a construction contractor, we use estimates for costs to complete construction projects and the contract value of certain construction projects. These estimates have a direct effect on gross profit as reported in these consolidated financial statements. Actual results could materially differ from our estimates.

Operating cycle**—** In the accompanying Consolidated Balance Sheets, assets and liabilities relating to long-term construction contracts (e.g. contract assets and contract liabilities) are considered current assets and current liabilities, since they are expected to be realized or liquidated in the normal course of contract completion, although completion may require more thanone calendar year.

Consequently, we have significant working capital invested in assets that may have a liquidation period extending beyondone year. We have claims receivable and retention due from various customers and others that are currently in dispute, the realization of which is subject to binding arbitration, final negotiation or litigation, all of which may extend beyondone calendar year.

Cash and cash equivalents**—**We consider all highly liquid investments with an original maturity of three months or less when purchased as cash equivalents.

Business combinations—Business combinations are accounted for using the acquisition method of accounting. We use the fair value of the assets acquired and liabilities assumed to account for the purchase price of businesses. The determination of fair value requires estimates and judgments of future cash flow expectations to assign fair values to the identifiable tangible and intangible assets. GAAP provides a “measurement period” of up to one year in which to finalize all fair value estimates associated with the acquisition of a business. Most estimates are preliminary until the end of the measurement period. During the measurement period, any material, newly discovered information that existed at the acquisition date would be reflected as an adjustment to the initial valuations and estimates. After the measurement period, any adjustments would be recorded as a current period income or expense.

Contingent earnout liabilities**—**As part of certain acquisitions, we agreed to pay cash to certain sellers upon meeting specific operating performance targets for specified periods subsequent to the acquisition date. Each quarter we evaluate the fair value of the estimated contingency and record a non-operating charge for the change in the fair value.

Upon meeting the target, we reflect the full liability on the balance sheet and record a charge to*“Other income (expense), net”* for the change in the fair value of the liability from the prior period.

Goodwill and other intangible assets**—**We account for goodwill in accordance with ASC 350, “Intangibles — Goodwill and Other”. Under ASC 350, goodwill is subject to an annual impairment test, which we perform as of the first day of the fourth quarter of each year, with more frequent testing if indicators of potential impairment exist. The impairment review is performed at the reporting unit level for those units with recorded goodwill. Our qualitative assessment is used to determine whether it is more likely than not (that is, a likelihood of more than 50 percent) that the fair value of the reporting unit is less than its carrying value, including goodwill. Factors used in our qualitative assessment include, but are not limited to, macroeconomic conditions, industry and market conditions, cost factors, overall financial performance and Company and reporting unit specific events. If deemed necessary, we use the quantitative impairment test outlined in ASC 350, which compares the fair value of a reporting unit with its carrying amount. Fair value for the goodwill impairment test is determined utilizing a discounted cash flow analysis based on our financial plan discounted using our weighted average cost of capital and market indicators of terminal year cash flows. Other valuation methods may be used to corroborate the discounted cash flow method. If the carrying amount of a reporting unit is in excess of its fair value, goodwill is considered impaired and an impairment loss is recognized in an amount equal to that excess, limited to the total amount of goodwill of the reporting unit.

Income tax**—**Current income tax expense is the amount of income taxes expected to be paid for the financial results of the current year. A deferred tax liability or asset is established for the expected future tax consequences resulting from the differences in financial reporting bases and tax bases of assets and liabilities using enacted tax rates in effect for the years in which the differences are expected to reverse. A valuation allowance is provided if it is more likely than not that some or all of the deferred tax assets will not be realized. We provide for uncertain tax positions when such tax positions do not meet the recognition thresholds or measurement standards as set forth in ASC 740,“Income Taxes”. The difference between a tax position taken or expected to be taken on our income tax returns and the benefit recognized in our financial statements is referred to as an unrecognized tax benefit. Amounts for uncertain tax positions are adjusted in periods when new information becomes available or when positions are effectively settled. We recognize accrued interest and penalties related to uncertain tax positions, if any, as a component of income tax expense.

As a result of the Tax Cuts and Jobs Act new taxes were created on certain foreign earnings. Namely, U.S. shareholders are now subject to a current tax on global intangible low-taxed income (“GILTI”) earned by specified foreign subsidiaries. Available guidance related to GILTI provides for an accounting policy election to either recognize deferred taxes for temporary basis differences expected to reverse as GILTI in future years or provide for the tax expense related to GILTI in the year the tax is incurred as a period expense. We have elected to recognize the current tax on GILTI as an expense in the period the tax is incurred. The current tax impacts of GILTI are included in our effective tax rate.

Comprehensive income**—**We account for comprehensive income in accordance with ASC 220, “Comprehensive Income”, which specifies the computation, presentation and disclosure requirements for comprehensive income (loss). Comprehensive income (loss) consists of net income (loss) and foreign currency translation adjustments, primarily from fluctuations in foreign currency exchange rates of our foreign subsidiaries with a functional currency other than the U.S. dollar.

Functional currencies and foreign currency translation**—** For foreign operations where substantially all monetary transactions are in the local currency, we use the local currency as our functional currency. The effects of translating financial statements of foreign operations into our reporting currency are recognized as a cumulative translation adjustment, net of tax in*“Accumulated other comprehensive income”* in the Consolidated Statements of Stockholders’ Equity. For certain foreign operations where substantially all monetary transactions are made in United States dollars, we use the U.S. dollar as our functional currency, with gains or losses on translation recorded in income in the period in which they are incurred. Gains or losses on foreign currency transactions are recorded in income in the period in which they are incurred.

Partnerships and joint ventures** —** We are periodically a member of a partnership or a joint venture. These partnerships or joint ventures are used primarily for the execution of single contracts or projects. Our ownership can vary from a small noncontrolling ownership to a significant ownership interest. We evaluate each partnership or joint venture to determine whether the entity is considered a variable interest entity (“VIE”) as defined in ASC 810,

“Consolidation”, and if a VIE, whether we are the primary beneficiary of the VIE, which would require us to consolidate the VIE in our financial statements. When consolidation occurs, we account for the interests of the other parties as a noncontrolling interest and disclose the net income attributable to noncontrolling interests.

Cash concentration**—**We place our cash in demand deposit accounts and short-term U.S. Treasury bonds. At December 31, 2025 and 2024, we had cash balances of $535.5 million and $455.8 million, respectively. Our cash balances are held in high credit quality financial institutions in order to mitigate the risk of holding funds not backed by the federal government or in excess of federally backed limits.

Collective bargaining agreements**—**Approximately 30% of our hourly employees, primarily consisting of field laborers, were covered by collective bargaining agreements in 2025. Upon renegotiation of such agreements, we could be exposed to increases in hourly costs and work stoppages.

Multiemployer plans** —**Various subsidiaries are signatories to collective bargaining agreements. These agreements require that we participate in and contribute to a number of multiemployer benefit plans for our union employees at rates determined by the agreements. The trustees for each multiemployer plan determine the eligibility and allocations of contributions and benefit amounts, determine the types of benefits and administer the plan. If we were to withdraw from an agreement, we could incur a withdrawal obligation, and the potential withdrawal obligation may be significant. In accordance with GAAP, any withdrawal liability would be recorded when it is probable that a liability exists and can be reasonably estimated.

Insurance**—**We self-insure worker’s compensation liability, general liability, and auto liability up to certain limits per claim. We maintained a self-insurance reserve totaling $72.9 million and $57.9 million at December 31, 2025 and 2024, respectively, with the current portion recorded to “Accrued liabilities” and the long-term portion recorded to “Other long-term liabilities” on the Consolidated Balance Sheets. Claims administration expenses are charged to current operations as incurred. Our accruals are based on judgment and the probability of losses, with the assistance of third-party actuaries. Actual payments that may be made in the future could materially differ from such reserves.

Derivative instruments and hedging activities — We recognize all derivative instruments as either assets or liabilities on the balance sheet at their respective fair values. From time to time we use interest rate swap agreements. The interest rate swap agreements are entered into to improve the predictability of cash flows from interest payments related to variable rate debt and are not designated as a hedge for accounting purposes. Therefore, the change in the fair value of the derivative asset or liability is reflected in net income in the Consolidated Statements of Income (mark-to-market accounting). Cash flows from derivatives settled are reported as cash flow from operating activities.

Accounts receivable—Accounts receivable and contract receivables are primarily with public and private companies and governmental agencies located in the United States and Canada. Credit terms for payment of products and services are extended to customers in the normal course of business. Contract receivables are generally progress billings on projects, and as a result, are short-term in nature. Generally, we require no collateral from our customers, but file statutory liens or stop notices on any construction projects when collection problems are anticipated. While a project is underway, we estimate the collectability of contract amounts at the same time that we estimate project costs. As discussed in Note 4 —“Revenue”, realization of the eventual cash collection may be recognized as adjustments to the contract revenue and profitability. We provide an allowance for credit losses to estimate losses from uncollectible accounts. Under this method an allowance is recorded based upon historical experience and management’s evaluation of, among other factors, current and reasonably supportable expected future economic conditions and the customer’s willingness or ability to pay. Receivables are written off in the period deemed uncollectible. The allowance for credit losses at December 31, 2025 and 2024 was less than $0.1 million and $2.0 million, respectively.

Accounts Receivable Securitization Facility— In June 2023, we entered into an Accounts Receivable Securitization Facility (the “AR Facility”) with PNC Bank, National Association (“PNC”) to reduce interest costs and improve cash flows from trade accounts receivable. In July 2024, we renewed the AR Facility for atwo-year term, added Regions Bank (“Regions”) to the AR Facility, and increased the maximum purchase commitment to $150.0 million at any one time. In March 2025, we entered into an amended and restated Accounts Receivable Securitization Facility (the “Amended AR Facility”), modifying certain terms of the AR Facility and extending the maturity date of the AR Facility to March 24, 2027. In August 2025, we increased the maximum commitment amount under the Amended AR Facility to $250.0 million. Fees associated with the Amended AR Facility for the year ended December 31, 2025 were $7.5 million

and are included in interest expense in the Consolidated Statements of Income. Fees associated with the AR Facility for the year ended December 31, 2024 and 2023 were $5.2 million and $1.9 million, respectively, and are included in interest expense in the Consolidated Statements of Income.

Under the Amended AR Facility, certain of our designated subsidiaries may sell or pledge their trade accounts receivable as they are originated to a wholly owned bankruptcy remote Special Purpose Entity (“SPE”) created specifically for this purpose. We control and, therefore, consolidate the SPE in our consolidated financial statements. When the SPE transfers ownership and control of qualifying accounts receivable to PNC and Regions, we and our related subsidiaries have no continuing involvement in the transferred accounts receivable, other than collection and administrative responsibilities. Once sold, the accounts receivable are no longer available to satisfy our creditors or our related subsidiaries. Accounts receivable sold to the banking counterparty are recorded as a sale of financial assets and derecognized as trade accounts receivable from our Consolidated Balance Sheets. We account for accounts receivable pledged to the banking counterparty as a secured borrowing and record as long-term debt on our Consolidated Balance Sheets.

The total outstanding balance of trade accounts receivable that have been sold and derecognized is $125.0 million as of December 31, 2025. For the years ended December 31, 2025 and 2024, we received $50.0 million and $10.0 million, respectively, in cash proceeds from the sale of accounts receivables under the Amended AR Facility and AR Facility, respectively, and repaid $0 and $10.0 million, respectively, which are included in cash from operating activities in the Consolidated Statements of Cash Flows.

The total outstanding balance of trade accounts receivable that have been pledged is $62.5 million as of December 31, 2025. For the year ended December 31, 2025, we received $62.5 million in cash proceeds from the pledge of accounts receivables under the Amended AR Facility, and did not repay any amounts to the Amended AR Facility, which are included in cash from financing activities in the Consolidated Statements of Cash Flows. For the year ended December 31, 2024, we did not pledge any accounts receivable under the AR Facility.

The SPE owned $185.3 million of trade accounts receivable as of December 31, 2025, which is included in “Accounts receivable, net” on the Consolidated Balance Sheets. In addition, the SPE had $62.5 million of debt outstanding as of December 31, 2025, which is included in “Long-term debt, net of current portion” on the Consolidated Balance Sheets. As of December 31, 2025, we had $62.5 million available capacity under the Amended AR Facility.

Significant revision in contract estimates** —** We recognize revenue over time for contracts where scope is adequately defined, and therefore we can reasonably estimate total contract value. Under this method, the costs incurred to date as a percentage of total estimated costs are used to calculate revenue. Total estimated costs, and thus contract revenue and margin, are impacted by many factors, which can cause significant changes in estimates during the life cycle of a project. For projects that were in process at the end of the prior year, there can be a difference in revenue and profit that would have been recognized in the prior year had current year estimates of costs to complete been known at the end of the prior year. During the year ended December 31, 2025, certain contracts had revisions in estimates from those projected at December 31, 2024. This change in estimate resulted in a decrease in net income of $39.9 million, or $0.74 basic earnings per share and $0.73 diluted earnings per share for the year ended December 31, 2025.

Customer concentration — We operate in multiple industry segments encompassing the construction of commercial, utility, industrial and public works infrastructure assets primarily throughout the United States. Typically, the topten customers in any one calendar year account for approximately 40.0% to 50.0% of total revenue; however, the group that comprises the topten customers varies from year to year. For the years ended December 31, 2025, 2024 and 2023, approximately 53.1%,41.3% and 41.1%, respectively, of total revenue was generated from our topten customers in each year. In each of the years, a different group of customers comprised the topten customers by revenue. For the year ended December 31, 2025, one customer accounted for approximately 12.1% of our revenue. For the years ended December 31, 2024 and 2023, no one customer accounted for more than 10% of total revenue.

Property and equipment**—**Property and equipment are recorded at cost and are depreciated using the straight-line method over the estimated useful lives of the related assets, usually ranging from three tothirty years. Maintenance and repairs are charged to expense as incurred. Significant renewals and betterments are capitalized. At the time of retirement or other disposition of property and equipment, the cost and accumulated depreciation are removed from the accounts, and any resulting gain or loss is reflected in operating income.

We assess the recoverability of property and equipment whenever events or changes in business circumstances indicate that the carrying amount of the asset may not be fully recoverable. We perform an analysis to determine if an impairment exists. The amount of property and equipment impairment, if any, is measured based on fair value and is charged to operations in the period in which the impairment is determined by management. For the years ended December 31, 2025, 2024 and 2023, our management has not identified any material impairment of its property and equipment.

Taxes collected from customers**—**Sales and use taxes collected from our customers are recorded on a net basis.

Share-based payments and stock-based compensation**—**In May 2013, the shareholders approved and we adopted the Primoris Services Corporation 2013 Equity Incentive Plan (“2013 Equity Plan”). Detailed discussion of shares issued under the 2013 Equity Plan are included in Note 15 —“Stock-Based Compensation” and in Note 18—“Stockholders’ Equity”. Such share issuances include grants of Restricted Stock Units (“RSU”) and Performance Stock Units (“PSU”) to executives and certain senior managers and issuances of stock to non-employee members of the Board of Directors.

In May 2023, the shareholders approved and we adopted the Primoris Services Corporation 2023 Equity Incentive Plan (“2023 Equity Plan”). Detailed discussion of shares issued under the Equity Plan are included in Note 15 —“Stock-Based Compensation” and in Note 18—“Stockholders’ Equity”. Such share issuances include grants of RSUs and PSUs to executives and certain senior managers and issuances of stock to non-employee members of the Board of Directors.

Recently Issued Accounting Pronouncements

In December 2023, the FASB issued Accounting Standards Update (“ASU”) No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures”* *that requires presentation of specific categories of reconciling items, as well as reconciling items that meet a quantitative threshold, in the reconciliation between the income tax provision and the income tax provision using statutory tax rates. The standard also requires disclosure of income taxes paid disaggregated by jurisdiction with separate disclosure of income taxes paid to individual jurisdictions that meet a quantitative threshold. This ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendments should be applied prospectively; however entities have the option to apply retrospectively for each period presented. We adopted this ASU on a retrospective basis and it resulted in us including additional required disclosures in the financial statement footnotes in our annual report on form 10-K commencing with the year ending December 31, 2025, but did not have an effect on our consolidated financial position, results of operations, or cash flows.

In November 2024, the FASB issued ASU No. 2024-03, “Income Statement - Reporting Comprehensive Income – Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses”. This ASU requires an entity to disclose the amounts of purchases of inventory, employee compensation, depreciation, and intangible asset amortization included in each relevant expense caption. It also requires an entity to include certain amounts that are already required to be disclosed under current U.S. GAAP in the same disclosure. Additionally, it requires an entity to disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively, and to disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early adoption permitted. An entity may apply the amendments prospectively for reporting periods after the effective date or retrospectively to any or all prior periods presented in the financial statements. This ASU will likely result in us including additional required disclosures in the financial statement footnotes but is not expected to have an effect on our consolidated financial position, results of operations or cash flows.

Other new pronouncements issued but not effective until after December 31, 2025, are not expected to have a material impact on our consolidated results of operations, financial position or cash flows.

Note 3—Fair Value Measurements

ASC 820, “Fair Value Measurements and Disclosures” defines fair value, establishes a framework for measuring fair value in GAAP and requires certain disclosures about fair value measurements. ASC 820 addresses fair value GAAP for financial assets and financial liabilities that are remeasured and reported at fair value at each reporting period and for non-financial assets and liabilities that are remeasured and reported at fair value on a non-recurring basis.

In general, fair values determined by Level 1 inputs use quoted prices (unadjusted) in active markets for identical assets or liabilities. Fair values determined by Level 2 inputs use data points that are observable such as quoted prices, interest rates and yield curves. Fair values determined by Level 3 inputs are “unobservable data points” for the asset or liability and include situations where there is little, if any, market activity for the asset or liability.

The following table presents, for each of the fair value hierarchy levels identified under ASC 820, our financial assets and certain liabilities that are required to be measured at fair value at December 31, 2025 and 2024 (in millions):

Other financial instruments not listed in the table consist of accounts receivable, accounts payable and certain accrued liabilities. These financial instruments generally approximate fair value based on their short-term nature. The carrying value of our long-term debt approximates fair value based on a comparison with current prevailing market rates for loans of similar risks and maturities.

The interest rate swap is measured at fair value using the income approach, which discounts the future net cash settlements expected under the derivative contracts to a present value. These valuations primarily utilize indirectly observable inputs, including contractual terms, interest rates and yield curves observable at commonly quoted intervals. See Note 9 – “Derivative Instruments” for additional information.

Note 4—Revenue

We generate revenue under a range of contracting types, including fixed-price, unit-price, time and material, and cost reimbursable plus fee contracts, each of which has a different risk profile. For the years ended December 31, 2025, 2024, and 2023, $5.6 billion, $4.7 billion, and $3.9 billion, respectively of our revenue is derived from contracts where scope is adequately defined, and therefore we can reasonably estimate total contract value. For these contracts, revenue is recognized over time as work is completed because of the continuous transfer of control to the customer (typically using an input measure such as costs incurred to date relative to total estimated costs at completion to measure progress). For certain contracts, where scope is not adequately defined and we can’t reasonably estimate total contract value, revenue is recognized either on an input basis, based on contract costs incurred as defined within the respective contracts, or an output basis, based on units completed. Costs to obtain contracts are generally not significant and are expensed in the period incurred.

We evaluate whether two or more contracts should be combined and accounted for as one single performance obligation and whether a single contract should be accounted for as more than one performance obligation. ASC 606,Revenue from Contracts with Customers, defines a performance obligation as a contractual promise to transfer a distinct good or service to a customer. A contract’s transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. Our evaluation requires significant judgment

and the decision to combine a group of contracts or separate a contract into multiple performance obligations could change the amount of revenue and profit recorded in a given period. The majority of our contracts have a single performance obligation, as the promise to transfer the individual goods or services is not separately identifiable from other promises in the contract and, therefore, is not distinct. However, occasionally we have contracts with multiple performance obligations. For contracts with multiple performance obligations, we allocate the contract’s transaction price to each performance obligation using the observable standalone selling price, if available, or alternatively our best estimate of the standalone selling price of each distinct performance obligation in the contract. The primary method used to estimate standalone selling price is the expected cost plus a margin approach for each performance obligation.

As of December 31, 2025, we had $5.3 billion of remaining performance obligations. We expect to recognize approximately 65.9% of our remaining performance obligations as revenue during the next 12 months and substantially all of the remaining balance in the 12 to 18 months thereafter.

Accounting for long-term contracts involves the use of various techniques to estimate total transaction price and costs. For long-term contracts, transaction price, estimated cost at completion and total costs incurred to date are used to calculate revenue earned. Unforeseen events and circumstances can alter the estimate of the costs and potential profit associated with a particular contract. Total estimated costs, and thus contract revenue and income, can be impacted by changes in productivity, scheduling, the unit cost of labor, subcontracts, materials and equipment. Additionally, external factors such as weather, client needs, client delays in providing permits and approvals, labor availability, governmental regulation, politics and pandemics may affect the progress of a project’s completion, and thus the timing of revenue recognition. To the extent that original cost estimates are modified, estimated costs to complete increase, delivery schedules are delayed, or progress under a contract is otherwise impeded, cash flow, revenue recognition and profitability from a particular contract may be adversely affected.

The nature of our contracts gives rise to several types of variable consideration, including contract modifications (change orders and claims), liquidated damages, volume discounts, performance bonuses, incentive fees, and other terms that can either increase or decrease the transaction price. We estimate variable consideration as the most likely amount to which we expect to be entitled. We include estimated amounts in the transaction price to the extent we believe we have an enforceable right, and it is probable that a significant reversal of cumulative revenue recognized will not occur. Our estimates of variable consideration and the determination of whether to include estimated amounts in the transaction price are based largely on an assessment of our anticipated performance and all information (historical, current and forecasted) that is reasonably available to us at this time.

Contract modifications result from changes in contract specifications or requirements. We consider unapproved change orders to be contract modifications for which customers have not agreed to both scope and price. We consider claims to be contract modifications for which we seek, or will seek, to collect from customers, or others, for customer-caused changes in contract specifications or design, or other customer-related causes of unanticipated additional contract costs on which there is no agreement with customers. Claims can also be caused by non-customer-caused changes, such as rain or other weather delays. Costs associated with contract modifications are included in the estimated costs to complete the contracts and are treated as project costs when incurred. In most instances, contract modifications are for goods or services that are not distinct, and, therefore, are accounted for as part of the existing contract. The effect of a contract modification on the transaction price, and our measure of progress for the performance obligation to which it relates, is recognized as an adjustment to revenue on a cumulative catch-up basis. In some cases, settlement of contract modifications may not occur until after completion of work under the contract.

As a significant change in one or more of these estimates could affect the profitability of our contracts, we review and update our contract-related estimates regularly. We recognize adjustments in estimated profit on contracts under the cumulative catch-up method. Under this method, the cumulative impact of the profit adjustment is recognized in the period the adjustment is identified. Revenue and profit in future periods of contract performance are recognized using the adjusted estimate. For the year ended December 31, 2025, revenue was negatively impacted by $23.2 million as a result of changes in estimates associated with performance obligations satisfied prior to December 31, 2024. For the year ended December 31, 2024, revenue was negatively impacted by $32.8 million as a result of changes in estimates associated with performance obligations satisfied prior to December 31, 2023. If at any time the estimate of contract profitability indicates an anticipated loss on a contract, the projected loss is recognized in full, including the reversal of any previously recognized profit, in the period it is identified and recognized as an “accrued loss provision” which is

included in “Contract liabilities” on the Consolidated Balance Sheets. For contract revenue recognized over time, the accrued loss provision is adjusted so that the gross profit for the contract remains zero in future periods.

At December 31, 2025, we had approximately $201.2 million of unapproved contract modifications included in the aggregate transaction prices. These contract modifications were in the process of being negotiated in the normal course of business. Approximately $179.5 million of the unapproved contract modifications had been recognized as revenue on a cumulative catch-up basis through December 31, 2025.

In all forms of contracts, we estimate the collectability of contract amounts at the same time that we estimate project costs. If we anticipate that there may be issues associated with the collectability of the full amount calculated as the transaction price, we may reduce the amount recognized as revenue to reflect the uncertainty associated with realization of the eventual cash collection. For example, when a cost reimbursable project exceeds the client’s expected budget amount, the client frequently requests an adjustment to the final amount. Similarly, some utility clients reserve the right to audit costs for significant periods after performance of the work.

The timing of when we bill our customers is generally dependent upon agreed-upon contractual terms, milestone billings based on the completion of certain phases of the work, or when services are provided. Sometimes, billing occurs subsequent to revenue recognition, resulting in unbilled revenue, which is a contract asset. Also, we sometimes receive advances or deposits from our customers before revenue is recognized, resulting in deferred revenue, which is a contract liability.

The caption “Contract assets” in the Consolidated Balance Sheets represents the following:

Contract assets consist of the following (in millions):

Contract assets increased by $163.2 million compared to December 31, 2024, primarily due to increased unbilled revenue and retention receivable.

The caption “Contract liabilities” in the Consolidated Balance Sheets represents the following:

Contract liabilities consist of the following (in millions):

Contract liabilities increased by $16.2 million compared to December 31, 2024, due to increased deferred revenue.

Revenue recognized for the years ended December 31, 2025 and 2024, that was included in the contract liability balance at the beginning of each year was approximately $565.3 million and $324.4 million, respectively.

The following tables present our revenue disaggregated into various categories.

MSA and Non-MSA revenue was as follows (in millions):

Revenue by contract type was as follows (in millions):

Each of these contract types has a different risk profile. Typically, we assume more risk with fixed-price contracts. Unforeseen events and circumstances can alter the estimate of the costs and potential profit associated with a particular fixed-price contract. However, these types of contracts offer additional profits when we complete the work for less cost than originally estimated. Unit-price and cost reimbursable contracts generally subject us to lower risk. Accordingly, the associated fees are usually lower than fees earned on fixed-price contracts. Under these contracts, our profit may vary if actual costs vary significantly from the negotiated rates.

Note 5—Property and Equipment

The following is a summary of property and equipment (in millions):

• Leasehold improvements are depreciated over the shorter of the life of the leasehold improvement or the lease term.

Depreciation expense was $74.2 million, $75.9 million and $85.2 million for the years ended December 31, 2025, 2024 and 2023, respectively.

** Note 6—Goodwill and Intangible Assets**

The change in goodwill by segment for 2025 and 2024 was as follows (in millions):

The $0.8 million adjustment in 2024 relates to a disposal of assets within the Energy reporting unit.

There wereno impairments of goodwill for the years ended December 31, 2025, 2024 and 2023.

The table below summarizes the intangible asset categories, which are generally amortized on a straight-line basis (in millions):

Amortization expense of intangible assets was $17.7 million, $19.6 million and $21.8 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Estimated future amortization expense for intangible assets as of December 31, 2025, is as follows (in millions):

Note 7—Accounts Payable and Accrued Liabilities

At December 31, 2025 and 2024, accounts payable included retention amounts of approximately $61.4 million and $44.6 million, respectively. These amounts owed to subcontractors have been retained pending contract completion and customer acceptance of jobs.

The following is a summary of accrued liabilities (in millions):

Note 8—Credit Arrangements

Long-term debt and credit facilities consist of the following at December 31, 2025 (in millions):

The weighted average interest rate on total debt outstanding at December 31, 2025 and 2024 was 5.0% and 5.6%, respectively.

Scheduled maturities of long-term debt are as follows (in millions):

Commercial Notes Payable and Mortgage Notes Payable

From time to time, we enter into commercial equipment notes payable with various equipment finance companies and banks. At December 31, 2025, interest rates ranged from 1.60% to 6.28% per annum and maturity dates range from February 2025 through October 2030. The notes are secured by certain construction equipment.

From time to time, we enter into secured mortgage notes payable with various banks. At December 31, 2025, the interest rate on our outstanding mortgage note was 4.50% per annum and matures in October 2028. This note is secured by certain real estate.

Credit Agreement

On August 1, 2022, we entered into the Third Amended and Restated Credit Agreement (the “Credit Agreement”) with CIBC Bank USA, as administrative agent (the “Administrative Agent”) and co-lead arranger, and the financial parties thereto (collectively, the “Lenders”), which increased our term loan to an aggregate principal amount of $945.0 million (the “Term Loan”) and increased our revolving credit facility to $325.0 million (the “Revolving Credit Facility”), under which the Lenders agreed to make loans on a revolving basis from time to time and to issue letters of credit for up to the $325.0 million committed amount. The maturity date of the Credit Agreement is August 1, 2027. As of December 31, 2025, commercial letters of credit outstanding were $9.9 million. There wereno outstanding borrowings under the Revolving Credit Facility, and available borrowing capacity was $315.1 million as of December 31, 2025.

Under the Credit Agreement, we must make quarterly principal payments on the Term Loan in an amount equal to approximately $11.8 million, with the balance due on August 1, 2027.

The principal amount of all loans under the Credit Agreement will bear interest at either: (i) the Secured Overnight Financing Rate plus an applicable margin as specified in the Credit Agreement (based on our net senior debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”) ratio as defined in the Credit Agreement), or (ii) the Base Rate (which is the greater of (a) the Federal Funds Rate plus 0.50% or (b) the prime rate as announced by the Administrative Agent) plus an applicable margin as specified in the Credit Agreement. Quarterly non-use fees, letter of credit fees and administrative agent fees are payable at rates specified in the Credit Agreement.

The principal amount of any loan drawn under the Credit Agreement may be prepaid in whole or in part at any time, with a minimum prepayment of $5.0 million.

Loans made under the Credit Agreement are secured by our assets, including, among others, our cash, inventory, equipment (excluding equipment subject to permitted liens), and accounts receivable. Certain subsidiaries have issued joint and several guaranties in favor of the Lenders for all amounts under the Credit Agreement.

The Credit Agreement contains various restrictive and financial covenants including, among others, a net senior debt/EBITDA ratio and minimum EBITDA to cash interest ratio. In addition, the Credit Agreement includes restrictions on investments, change of control provisions and provisions in the event we dispose of more than 20% of our total assets. We were in compliance with the covenants for the Credit Agreement at December 31, 2025.

On September 13, 2018, we entered into an interest rate swap agreement to manage our exposure to the fluctuations in variable interest rates. The swap effectively exchanged the interest rate on 75% of the debt outstanding under our Term Loan from variable LIBOR to a fixed rate of 2.89% per annum, in each case plus an applicable margin. The interest rate swap matured on July 10, 2023. See Note 9 – “Derivative Instruments”.

On January 31, 2023, we entered into a second interest rate swap agreement to manage our exposure to the fluctuations in variable interest rates. The swap effectively exchanged the interest rate on $300.0 million of the debt outstanding under our Term Loan from variable to a fixed rate of 4.095% per annum, plus an applicable margin. The interest rate swap matured on January 31, 2025. See Note 9 – “Derivative Instruments”.

Canadian Credit Facilities

We have credit facilities totaling $14.0 million in Canadian dollars for the purposes of issuing commercial letters of credit and providing funding for working capital. At December 31, 2025, commercial letters of credit outstanding were $0.3 million in Canadian dollars and there wereno outstanding borrowings. Available capacity at December 31, 2025, was $13.7 million in Canadian dollars.

Note 9 — Derivative Instruments

We are exposed to certain market risks related to changes in interest rates. To monitor and manage these market risks, we have established risk management policies and procedures. We do not enter into derivative instruments for any purpose other than hedging interest rate risk. None of our derivative instruments are used for trading purposes.

Interest Rate Risk. We are exposed to variable interest rate risk as a result of variable-rate borrowings under our Credit Agreement. To manage fluctuations in cash flows resulting from changes in interest rates on a portion of our variable-rate debt, we entered into an interest rate swap agreement on September 13, 2018, with an initial notional amount of $165.0 million. The notional amount of the swap was adjusted down each quarter by a portion of the required principal payments made on the Term Loan and matured on July 10, 2023. On January 31, 2023, we entered into a second interest rate swap agreement with a notional amount of $300.0 million. Neither swap was designated as a hedge for accounting purposes. The swaps effectively change the variable-rate cash flow exposure on the debt obligations to fixed rates. The fair value of outstanding interest rate swap derivatives can vary significantly from period to period depending on the total notional amount of swap derivatives outstanding and fluctuations in market interest rates compared to the interest rates fixed by the swap. As of December 31, 2024, our outstanding interest rate swap agreement contained a notional amount of $300.0 million. The interest rate swap matured on January 31, 2025.

Credit Risk. By using derivative instruments to economically hedge exposures to changes in interest rates, we are exposed to counterparty credit risk. Credit risk is the failure of a counterparty to perform under the terms of a derivative contract. When the fair value of a derivative contract is positive, the counterparty owes us, which creates credit risk for us. When the fair value of a derivative contract is negative, we owe the counterparty and, therefore, we do not possess credit risk. We minimize the credit risk in derivative instruments by entering into transactions with high quality counterparties. We have entered into netting agreements, including International Swap Dealers Association Agreements, which allow for netting of contract receivables and payables in the event of default by either party.

The following table summarizes the fair value of our derivative contracts included in the Consolidated Balance Sheets (in millions):

The following table summarizes the amounts recognized with respect to our derivative instruments within the Consolidated Statements of Income (in millions):

Note 10—Leases

We lease administrative and operational facilities, which are generally longer-term, project specific facilities or yards, and construction equipment under non-cancelable operating leases. We determine if an arrangement is a lease at inception. We have lease agreements with lease and non-lease components, which are generally accounted for separately. Operating leases are included in “Operating lease assets”, “Accrued liabilities”, and “Noncurrent operating lease liabilities, net of current portion” on our Consolidated Balance Sheets. We also made an accounting policy election in which leases with an initial term of 12 months or less are not recorded on the balance sheet and lease payments are recognized in the Consolidated Statements of Income on a straight-line basis over the lease term.

Operating lease assets and operating lease liabilities are recognized at commencement date based on the present value of the future minimum lease payments over the lease term. In determining our lease term, we include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. For our leases that do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date to determine the present value of future payments. Lease expense from minimum lease payments is recognized on a straight-line basis over the lease term.

Our leases have remaining lease terms that expire at various dates through 2035, some of which may include options to extend the leases for up to 5 years. The exercise of lease extensions is at our sole discretion. Periodically, we sublease excess facility space, but any sublease income is generally not significant. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants.

The components of operating lease expense are as follows (in millions):

Our operating lease liabilities are reported on the Consolidated Balance Sheets as follows (in millions):

The future minimum lease payments under non-cancelable operating leases are as follows (in millions):

Other information related to operating leases is as follows (in millions, except lease term and discount rate):

.

Note 11—Commitments and Contingencies

Legal proceedings—We are subject to claims and legal proceedings arising out of our business. We record costs related to contingencies when a loss from such claims is probable and the amount is reasonably estimable. In determining whether it is possible to provide an estimate of loss, or range of possible loss, we review and evaluate our litigation and regulatory matters on a quarterly basis in light of potentially relevant factual and legal developments. If we determine an unfavorable outcome is not probable or reasonably estimable, we do not accrue for a potential litigation loss.

Management is unable to ascertain the ultimate outcome of claims and legal proceedings; however, after review and consultation with counsel and taking into consideration relevant insurance coverage and related deductibles/self-insurance retention, management believes that it has meritorious defenses to the claims and believes that the reasonably possible outcome of such claims will not, individually or in the aggregate, have a materially adverse effect on our consolidated results of operations, financial condition or cash flow.

Representation and Warranty Insurance Recoveries—We have obtained representation and warranty insurance to insure us against potential losses resulting from breaches of certain representations and warranties in connection with certain prior acquisitions. When appropriate, we file claims to recover losses attributable to breaches of representations or warranties by a selling party. The size of claim and amount of recovery can vary, but in some cases could have a material effect on our consolidated results of operations, financial condition or cash flow.

Bonding—As of December 31, 2025 and 2024, we had bid and payment/performance bonds issued and outstanding totaling approximately $8.7 billion and $8.1 billion, respectively. The remaining performance obligation on those bonded projects totaled approximately $2.4 billion and $3.0 billion, respectively.

Note 12—Reportable Segments

Our Chief Operating Decision Maker (“CODM”), who is our President and Chief Executive Officer, regularly reviews operating and financial performance based on our operating segments. We have aggregated our operating segments intotwo reportable segments in consideration of the aggregation criteria set forth in ASC 280. Our current reportable segments include the Utilities segment and the Energy segment.

Each of our reportable segments is composed of similar business units that specialize in services unique to the segment. Driving the end-user focused segments are differences in the economic characteristics of each segment, the nature of the services provided by each segment, the production processes of each segment, the type or class of customer using the segment’s services, the methods used by the segment to provide the services, and the regulatory environment of each segment’s customers.

The classification of certain operating expenses and SG&A expenses for segment reporting purposes can at times require judgment on the part of management. Our segments may perform services across industries or perform joint services for customers in multiple industries. To determine reportable segment profitability, certain allocations, including allocations of shared and indirect costs, as well as general and administrative costs are made. Certain of our fixed assets are used on an interchangeable basis across both reportable segments.

The following is a brief description of the reportable segments:

The Utilities segment operates throughout the United States and specializes in a range of services, including the installation and maintenance of new and existing natural gas and electric utility distribution and transmission systems, and communications systems.

The Energy segment operates throughout the United States and Canada and specializes in a range of services that include engineering, procurement, construction, and maintenance services for entities in the energy, renewable energy and energy storage, renewable fuels, and petroleum and petrochemical industries, as well as state departments of transportation.

Corporate and non-allocated costs include corporate facility and property costs; corporate salaries, benefits, incentive compensation and non-cash stock-based compensation; and acquisition and integration costs.

Segment Operating Income

Operating income is calculated as revenue less cost of revenue and SG&A costs. Cost of revenue includes certain direct and indirect costs such as labor and materials, equipment, depreciation, and subcontractor costs. SG&A includes compensation and benefits for executive, management level and administrative employees, marketing and communications, professional fees, rent for facilities and utilities, amortization, and other general costs required to run our business.

Operating performance by segment for the years ended December 31, 2025, 2024 and 2023 was as follows (in millions):

Reconciliation of operating income to income before provision for income taxes is as follows (in millions):

Depreciation and Amortization

Depreciation of various fixed assets and finance leases and amortization of intangible assets are reported by the segment/corporate group that utilizes the underlying assets. Depreciation and amortization are included within Cost of revenue and SG&A in the Consolidated Statements of Income. A substantial majority of depreciation is reported in Cost of revenue and all amortization is included within SG&A. Depreciation and amortization expense by segment for the years ended December 31, 2025, 2024, and 2023 was as follows (in millions):

Separate measures of our business assets and cash flows by reportable segment, including capital expenditures, are not produced or utilized by management and our CODM, as defined by ASC 280, to evaluate segment performance and are therefore not presented by segment.

Geographic Region — Revenue and Total Assets

The majority of our revenue is derived from customers in the United States with approximately 2.3%,4.6% and 5.8% generated from sources outside of the United States, principally Canada, for the years ended December 31, 2025, 2024 and 2023, respectively. At December 31, 2025 and 2024, approximately 3.4% and 4.0%, respectively of total assets were located outside of the United States.

Note 13 — Multiemployer Plans

Union Plans**—**Various subsidiaries are signatories to collective bargaining agreements. These agreements require that we participate in and contribute to a number of multiemployer benefit plans for our union employees at rates determined by the agreements. The trustees for each multiemployer plan determine the eligibility and allocations of contributions and benefit amounts, determine the types of benefits and administer the plan.

We contributed $68.2 million, $62.9 million, and $62.2 million, to multiemployer pension plans for the years ended December 31, 2025, 2024 and 2023, respectively. These costs were charged to the related construction contracts in process.

The financial risks of participating in multiemployer plans are different from single-employer plans in the following respects:

Under U.S. legislation regarding multiemployer pension plans, an employer is required to pay an amount that represents its proportionate share of a plan’s unfunded vested benefits in the event of withdrawal from a plan or upon plan termination.

We participate in a number of multiemployer pension plans, and our potential withdrawal obligation may be significant. Any withdrawal liability would be recorded when it is probable that a liability exists and can be reasonably estimated, in accordance with GAAP. We have no plans to withdraw from any labor agreements.

During the last three years, we made annual contributions to 45 pension plans. Based upon the most recent and available plan financial information, we made contributions to the Construction Laborers Pension Trust for Southern California, the Southern California Pipe Trades Trust Funds, the Minnesota Laborers Pension Fund, and the Pipeline Industry Benefit Fund that represented more than 5% of the plan’s total contributions. None of the other significant pension plans we contributed to below listed us in the plan’s Form 5500 as providing more than 5% of the plan’s total contributions during the years ended December 31, 2025, 2024 and 2023.

Our participation in significant plans for the years ended December 31, 2025, 2024 and 2023 is outlined in the table below. The “EIN/Pension Plan Number” column provides the Employer Identification Number (“EIN”) and the three digit plan number. The “Zone Status” is based on the latest information that we received from the plan and is certified by the plan’s actuary. Among other factors, plans in the red zone are generally less than 65 percent funded, plans in the yellow zone are less than 80 percent funded, and plans in the green zone are at least 80 percent funded. The “FIP/RP Status Pending/Implemented” column indicates plans for which a financial improvement plan (“FIP”) or a rehabilitation plan (“RP”) is either pending or has been implemented. The “Surcharge Imposed” column includes plans in a red zone status that require a payment of a surcharge in excess of regular contributions. The next column lists the expiration date of our collective bargaining agreement related to the plan.

Note 14—Employee Benefit Plans

Defined Contribution Plans**—**We sponsor multiple defined contribution plans for eligible employees not covered by collective bargaining agreements. Our plans include various features such as voluntary employee pre-tax and Roth-based contributions and matching contributions made by us. In addition, at the discretion of our Board of Directors, we may make additional profit share contributions to the plans. No such additional contributions were made during 2023 through 2025. Matching contributions to all defined contribution plans for the years ended December 31, 2025, 2024 and 2023 were $21.5 million, $18.0 million, and $16.4 million, respectively. The increase in matching contributions in 2025 is primarily due to increased participation in the plans. We have no other post-retirement benefits.

Deferred Compensation Plan**—**In 2023, we adopted a non-qualified deferred compensation plan under which eligible directors and key employees may defer their receipt of certain cash compensation. This plan is an unfunded and unsecured compensation arrangement. Individuals participating in the plan may allocate deferred cash amounts among a group of notional accounts that mirror the gains and losses of various investment alternatives. Generally, participants receive distributions of deferred balances based on predetermined payout schedules or other events.

The plan covering key employees provides for employer matching contributions for certain officers and employees whose benefits under the 401(k) plan are limited by federal tax law. Contributions vest immediately provided that vesting accelerates upon a change in control or the participant’s death or retirement. Any matching and discretionary employer contributions, whether vested or not, are forfeited upon a participant’s termination of employment for cause or upon the participant engaging in competition with Primoris or any of its affiliates.

As of December 31, 2025 and 2024, the deferred compensation liability under our deferred compensation plan was $2.2 and $1.2 million, respectively, which was included in “Other long-term liabilities” in the accompanying Consolidated Balance Sheets. To provide for future obligations related to these deferred compensation plans, we have invested in corporate-owned life insurance (“COLI”) policies covering certain participants in the deferred compensation plans, the underlying investments of which are intended to be aligned with the investment alternatives elected by plan participants. The COLI assets are recorded at their cash surrender value, which is considered their fair market value, and as of December 31, 2025 and 2024, the fair market was $2.1 million and $1.1 million, respectively, which was included in “Other long-term assets” in the accompanying Consolidated Balance Sheets.

Note 15—Stock-Based Compensation

We maintain two equity compensation plans under which stock-based compensation has been granted, the 2013 Equity Plan and the 2023 Equity Plan. Upon the adoption of the 2023 Equity Plan, awards were no longer granted under the 2013 Equity Plan. The 2023 Equity Plan permits the granting of up to 6.5 million shares to executives, directors and certain senior managers. Grants of awards to employees are approved by the Compensation Committee of the Board of Directors and grants to independent members of the Board of Directors are approved by the Board of Directors. As of December 31, 2025, there were 5.5 million shares of common stock remaining available for grant under the 2023 Equity Plan.

Under guidance of ASC 718, “Compensation — Stock Compensation”, stock-based compensation cost is measured at the date of grant, based on the calculated fair value of the stock-based award, and is recognized as expense over the employee’s requisite service period (generally the vesting period of the award). We settle the vesting of RSUs and PSUs through the issuance of new shares of common stock. Forfeitures of stock-based awards are recognized as they occur.

Restricted Stock Units

We grant time-vested stock awards in the form of restricted stock units. The fair value of the RSUs is based on the closing market price of our common stock on the day prior to the date of the grant. Stock compensation expense for the RSUs is amortized using the straight-line method over the service period. Time-vested stock awards granted to eligible employees generally vest 25% in year one,25% in year two, and 50% in year three.

The table below presents RSU activity for 2025:

During 2024,306,674 RSUs were granted with a weighted-average grant date fair value per unit of $45.16. The total fair value of RSUs that vested during 2025, 2024 and 2023 was $7.9 million, $11.5 million and $6.5 million, respectively. At December 31, 2025, approximately $18.5 million of unrecognized compensation expense remains for the RSUs, which will be recognized over a weighted average period of 2.19 years.

Performance Stock Units

Shares of our common stock may be earned based on our performance compared to defined metrics. The number of shares earned under a performance award can vary from zero to 200% of the target shares awarded, based upon our performance compared to the metrics. The metrics used for the grant are determined by the Compensation Committee of the Board of Directors and may be either based on internal measures such as our financial performance compared to target or on a market-based metric such as our stock performance compared to a peer group. Performance awards vest over three years based upon attainment of at least the minimum stated performance targets and minimum service requirements. For performance awards, we recognize stock-based compensation expense based on the grant date fair value of the award. The fair value of internal metric-based performance awards is determined by the market price of our common stock on the day prior to the date of the grant. Stock compensation expense for the PSUs is amortized using the straight-line method over the service period. We adjust the stock-based compensation expense related to internal metric-based performance awards according to our determination of the shares expected to vest at each reporting date. Stock-based compensation expense related to market metric-based performance awards is expensed at their grant date fair value regardless of performance.

The table below presents PSU activity for 2025:

At December 31, 2025, approximately $6.9 million of unrecognized compensation expense remains for the PSUs, which will be recognized over a weighted average period of 2.01 years.

Stock-based Compensation Expense

For the years ended December 31, 2025, 2024 and 2023, we recognized $20.6 million, $15.1 million, and $11.8 million, respectively, in compensation expense for both RSUs and PSUs.

Note 16—Income Taxes

Income before provision for income taxes consists of the following (in millions):

The components of the provision for income taxes are as follows (in millions):

A reconciliation of income tax expense compared to the amount of income tax expense that would result by applying the U.S. federal statutory income tax rate to pre-tax income is presented on both a dollar (in millions) and a percentage basis as follows:

The total cash paid for income taxes (net of refunds) is composed of the following (in millions):

The provision for income taxes has been determined based upon the tax laws and rates in the countries in which we operate. Our operations in the United States are subject to federal income tax rates of 21.0% and varying state income tax rates. Our principal international operations are in Canada. Our subsidiaries in Canada are subject to a corporate income tax rate of 23.0%. We did not have any non-taxable foreign earnings from tax holidays for taxable years 2023 through 2025.

We purchased $45.0 million of transferable ITCs in 2025 at a purchase price of $41.9 million which we expect to fully utilize within our 2025 federal income tax return. We purchased $40.0 million of transferable ITCs in 2024 at a purchase price of $36.9 million which were fully utilized within our 2024 federal income tax return. We made an accounting policy election to use the flow through income statement method under which we recognized the benefit of the ITC in our 2025 and 2024 income tax expense.

Deferred taxes are recognized for temporary differences between the financial reporting bases and tax bases of assets and liabilities and are measured using enacted tax rates expected to be in effect when such amounts are realized or settled. However, deferred tax assets are recognized only to the extent that it is more likely than not that they will be realized based upon consideration of available evidence, including future reversals of existing taxable temporary differences, future projected taxable income, the length of the tax asset carryforward periods, and tax planning strategies.

The tax effect of temporary differences that give rise to deferred income taxes are as follows (in millions):

As of December 31, 2025, we have recorded a deferred tax asset of $30.3 million reflecting the tax benefit of approximately $484.1 million of federal and state income tax net operating loss carryforwards, some of which were acquired in the acquisitions of PLH and other companies. Our tax credits of $1.4 million generally expire between 10 and 20 years after they are generated. Our U.S. federal net operating losses expire beginning in 2032, and our state net operating losses generally expire 20 years after the period in which the losses were incurred. Capital losses expire if not utilized within 5 years.

The valuation allowances for deferred income tax assets at December 31, 2025 and 2024, were $10.8 million and $10.3 million, respectively. The $0.5 million net increase in valuation allowances during 2025 was due to changes in the realizability of the state net operating losses, net of changes for capital losses. These valuation allowances relate to uncertainty in our outlook as to the amount of future taxable income required in particular tax jurisdictions in order to utilize certain tax losses, considering also the tax regulations which limit the annual utilization of acquired losses. We believe it is more likely than not that we will realize the benefit of our deferred tax assets net of existing valuation allowances.

A reconciliation of the beginning, ending and aggregate changes in the gross balances of unrecognized tax benefits is as follows (in millions):

We recognize accrued interest and penalties related to uncertain tax positions in income tax expense. We recognized interest expense related to uncertain tax positions of $0.5 million, $0.7 million, and $0.6 million for the years

ending December 31, 2025, 2024, and 2023, respectively. The effect on our tax rate if we were to recognize our gross unrecognized tax benefits as of December 31, 2025 approximates $16.8 million, including interest and penalties.

Our federal income tax returns are generally no longer subject to examination for tax years before 2020. The statutes of limitation of state and foreign jurisdictions generally vary between 3 to 5 years. Accordingly, our state and foreign income tax returns are generally no longer subject to examination for tax years before 2020.

Note 17—Dividends and Earnings Per Share

We have declared cash dividends during 2023, 2024 and 2025 as follows:

The payment of future dividends is contingent upon our revenue and earnings, capital requirements and our general financial condition, as well as contractual restrictions and other considerations deemed relevant by our Board of Directors.

The table below presents the computation of basic and diluted earnings per share for the years ended December 31, 2025, 2024 and 2023 (in millions, except per share amounts):

Note 18—Stockholders’ Equity

Preferred Stock

We are authorized to issue 1,000,000 shares of $0.0001 par value preferred stock. No shares of Preferred Stock were outstanding at December 31, 2025 and 2024.

Common Stock

We are authorized to issue 90,000,000 shares of $0.0001 par value common stock, of which 54,045,067 and 53,740,729 shares were issued and outstanding as of December 31, 2025 and 2024, respectively.

We issued 3,118 shares of common stock in 2025,11,359 shares of common stock in 2024, and 21,245 shares of common stock in 2023 under our LTR Plan. The shares were purchased by the participants in the LTR Plan with payments made to us of $0.2 million in 2025, $0.3 million in 2024, and $0.3 million in 2023. Our LTR Plan for managers allows participants to use a portion of their annual bonus amount to purchase our common stock at a discount from the market price. The shares purchased in 2025, 2024 and 2023 were for bonus amounts earned in 2024, 2023 and 2022 and the number of shares was calculated at 75% of the average closing price for December of the previous year.

During the years ended December 31, 2025, 2024, and 2023, we issued 13,983,24,792, and 39,040 shares of common stock, respectively, as part of the quarterly compensation of the non-employee members of the Board of Directors. The shares were fully vested upon issuance and have aone-year trading restriction.

During the years ended December 31, 2025, 2024, and 2023,273,112,322,713, and 168,605 RSUs, net of forfeitures for tax withholdings, respectively, were converted to common stock.

Employee Stock Purchase Plan

In May 2022, our shareholders approved the 2022 Primoris Services Corporation Employee Stock Purchase Plan for which, eligible full-time employees can purchase shares of our common stock at a discount. The purchase price of the stock is 90% of the lower of the market price at the beginning of the offering period or the end of the offering period. Purchases occur semi-annually, approximately 30 days following the filing of our Annual Report on Form 10-K for the fiscal year ended December 31 of each year, but in no cases can extend beyond March 31 of the period or year, and approximately 30 days following the filing of our Quarterly Report on Form 10-Q for the fiscal quarter ended June 30 of each year. In 2025,14,125 shares were purchased at an average price of $62.20 per share. In 2024,15,538 shares were purchased at an average purchase price of $39.51 per share.

Share Purchase Plan

On April 30, 2025, our Board of Directors authorized a share purchase program under which we may acquire shares up to an aggregate purchase price of $150.0 million. The timing of share purchases, if any, depends on market conditions, share price and other factors. The share purchase program expires on April 30, 2028. During the year ended December 31, 2025, we did not purchase any shares of common stock. As of December 31, 2025, we had $150.0 million available for purchase under the share purchase program.

Note 19—Selected Quarterly Financial Information (Unaudited)

Selected unaudited quarterly consolidated financial information is presented in the following tables (in millions, except per share amounts):