Jacobs Solutions Inc. (NYSE:J) stock rose after it reported fourth-quarter and full-year fiscal 2025 results that showed revenue growth and higher adjusted earnings, while GAAP profit declined due to prior-year mark-to-market gains tied to its former Amentum stake. The stock has since given up its gains and is now trading lower.
The company reported fourth-quarter gross revenue of $3.2 billion, a 6.6% increase from the same period a year earlier, and adjusted net revenue of $2.2 billion, up 5.8%.
Quarterly GAAP net earnings were $138 million, down 55.4%, while adjusted EBITDA increased 12% to $324 million. GAAP EPS fell 55.9% to $1.05.
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Adjusted EPS for the quarter was $1.75, compared with an estimate of $1.68, and revenue of $3.155 billion exceeded the $2.261 billion estimate.
The backlog reached a new record of $23.1 billion, representing a 5.6% year-over-year increase, with a book-to-bill ratio of 1.1x.
For fiscal 2025, Jacobs reported $12.0 billion in gross revenue, representing a 4.6% increase from the prior year. Adjusted net revenue rose 5.3% to $8.7 billion.
GAAP net earnings declined 48.9% to $313 million, while adjusted EBITDA grew 13.9% to $1.2 billion. Full-year GAAP EPS fell to $2.58, down 46.1%, and adjusted EPS increased 15.9% to $6.12.
Chair and CEO Bob Pragada said, "We are pleased to have met or exceeded all our key metrics for FY25. We grew revenue organically mid-single-digits year-over-year and expanded our operating margin meaningfully."
He said several sectors drove growth in the Infrastructure & Advanced Facilities segment and highlighted improving momentum at PA Consulting.
"We enter FY26 with multiple secular tailwinds, clear line-of-sight to continued synergistic expansion with PA Consulting and a record backlog, positioning us for profitable growth," Pragada added.
"We delivered a record $1.1 billion of capital back to shareholders during FY25 through share repurchases and dividends, and we plan to continue returning capital to shareholders given the strength of our balance sheet and our outlook for cash generation," stated CFO Venk Nathamuni.
Segment results for fiscal 2025 included $10.8 billion in revenue and $903.5 million in operating profit for Infrastructure & Advanced Facilities and $1.3 billion in revenue and $278.5 million in operating profit for PA Consulting.
Operating cash flow for fiscal 2025 was $686.7 million, and free cash flow totaled $607.5 million. Jacobs ended the year with $1.24 billion in cash and cash equivalents. Long-term debt totaled $2.24 billion.
Outlook
The company issued fiscal 2026 guidance for adjusted EPS of $6.90 to $7.30, above the Wall Street estimate of $6.07.
Jacobs expects adjusted net revenue of $9.217 billion to $9.564 billion, compared with the $8.989 billion estimate.
The company projected an adjusted EBITDA margin of 14.4% to 14.7% and forecast a free cash flow margin of 7% to 8%.
New Contract
Jacobs announced on Wednesday that the company has been chosen by PsiQuantum to serve as the Owner's Representative for the company's new quantum computing facility at the Illinois Quantum and Microelectronics Park in Chicago, providing comprehensive support from design through construction.
Price Action: J shares were trading lower by 6.71% to $135.32 at last check Thursday.
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