Q2 2025 Jacobs Solutions Inc Earnings Call Transcript
Key Points
- Adjusted EPS grew over 22% to $1.43, supported by solid year-over-year margin expansion.
- PA Consulting's revenue growth turned positive, reaching mid-single digits and driving double-digit operating profit growth.
- Backlog grew 20% to more than $22 billion, setting a new record.
- Strong operating performance allowed the company to absorb the impact of a legal reserve and still grow adjusted EBITDA by 8%.
- The company reaffirmed its full-year guidance metrics, indicating confidence in future performance.
- Revenue growth during Q2 was adversely impacted by a legal reserve related to a joint venture matter and foreign exchange headwinds.
- The legal reserve had a meaningful impact on adjusted net revenue and adjusted operating profit.
- The procurement cycle is extending, which could delay project execution.
- Free cash flow was negative $114 million in Q2, reflecting seasonal cash timing events.
- GAAP EPS was impacted by a $109 million pretax loss associated with the mark-to-market adjustment of the investment in Amentum.
Ladies and gentlemen, thank you for standing by. My name is Krista, and I will be your conference operator today. At this time, I would like to welcome everyone to the Jacobs fiscal second-quarter 2025 earnings conference call. (Operator Instructions)
Thank you. And I would now like to turn the conference over to Bert Subin, Senior Vice President Investor Relations. Bert, you may begin.
Thank you, Christa, and good morning, everyone. Our earnings announcement and 10-Q were filed this morning, and we have posted a slide presentation on our website which will reference during the call.
I would like to refer you to slide 2 of the presentation material for information about our forward-looking statements, non-GAAP financial measures, and operating metrics. Now let's turn to the agenda on slide 3. Speaking on today's call will be Jacob's Chair and CEO, Bob Pragada; and CFO, Venk Nathamuni.
Bob will begin by providing comments on the business as well as highlights
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