Q1 2026 Jacobs Solutions Inc Earnings Call Transcript
Key Points
- Adjusted EPS grew 15% to $1.53, supported by robust 8% net revenue growth and solid underlying margin performance.
- Backlog increased by 21% to over $26 billion, setting a new record with a trailing 12-month book to bill rising to 1.4 times.
- Jacobs Solutions Inc (J) announced an agreement to acquire the remaining stake in PA Consulting, enhancing their digital consulting and AI advisory capabilities.
- Strong performance in life sciences and advanced manufacturing, with net revenue growth of 10% in Q1.
- Free cash flow came in at $365 million, supported by solid working capital performance and favorable cash timing.
- The margin tailwind from less PTO absorption last year did not recur this year, impacting margins.
- Higher-than-normal pass-through revenue in some large awards could affect net revenue growth.
- The acquisition of the remaining stake in PA Consulting will temporarily raise net leverage above the target range.
- Environmental services faced headwinds, though improvement is expected in the second half of the fiscal year.
- Some cash flow benefits in Q1 are expected to reverse in Q2 due to timing of payments.
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 you to the Jacobs Solutions fiscal first-quarter 2026 earning conference call and webcast. (Operator Instructions) Thank you.
I would now like to turn the call over to Bert Subin, Vice President, Investor Relations. Bert, you may begin.
Thank you, Krista, and welcome, everyone. Following market close, we issued our earnings announcement, filed our Form 10-Q, and we have posted a slide presentation on our website, which we will reference during the call. I would like to refer you to slide 2 of the presentation for information about forward-looking statements, non-GAAP financial measures, and operating metrics. Now let us turn to the agenda on slide 3.
Speaking on today's call will be Jacobs 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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