Primoris Services Corporation (PRIM)

Primoris Services Corporation reported third-quarter 2026 revenue of $2.0 billion on 3 November, down 10.4 percent from a year earlier 1. Net income was $51.3 million, or $0.95 per diluted share, compared with $94.6 million a year before 1. Revenue fell mainly on lower renewables revenue in the Energy segment, partly offset by growth in Utilities 1.

The weak year traces to cost overruns on six renewable energy projects, which cut the Energy segment's gross profit to 5.5 percent of revenue for the nine months from 10.5 percent a year earlier 2. Five of the six were materially complete on 30 September 2026, and the last is expected to be complete in the fourth quarter 2.

Total backlog, the work under contract plus expected work under multi-year service agreements, reached a record $14.1 billion, including $8.5 billion of service-agreement work 1. The board authorized a purchase of up to $250.0 million of the company's shares on 30 October 1. Two stockholders filed a putative class action on 21 July 2026 against the company and certain current and former officers, alleging false and misleading statements 2.

Chief executive Koti Vadlamudi said the company believes the foundation is in place for a return to growth in 2027 1.

Primoris builds and maintains utility, energy and renewable infrastructure in the United States and Canada 3. Revenue rose 19.0 percent in 2025 to $7.6 billion, and had risen 11.4 percent in 2024 36.

Margins moved the other way in 2025 3. Gross profit was 10.7 percent of revenue, down from 11.0 percent, because Energy margins were lower 3. In 2024 the margin had risen to 11.0 percent from 10.3 percent on better Utilities margins 3.

The company also paid down debt 3. Net interest expense fell to $28.7 million in 2025 from $65.3 million in 2024, on lower average debt and lower rates 3. Net income for the year was $274.9 million, and long-term debt fell by nearly $330 million 6.

Growth has also come from buying companies 3. The annual report lists a merger agreement dated December 14, 2020 with Future Infrastructure Holdings and another dated June 24, 2022 with PLH Group 3. Transaction costs fell in 2024 on lower integration costs for the PLH acquisition 3.

Leadership changed in 2025 6. The company and Thomas McCormick entered a mutual agreement of separation effective March 20, 2025 6. David King served as interim chief executive, and on 7 October 2025 the board named Koti Vadlamudi, a thirty-year Jacobs veteran, to the role effective November 10, 2025 5.

Then 2026 turned 4. On 22 June the company said it had found more cost overruns on six renewables projects, and now expected renewables revenue of about $2.1 billion for 2026, against about $3.0 billion in 2025 4. Its full-year net income range was cut to $71.0 million to $101.0 million, and the chief operating officer, Jeremy Kinch, left the same day 4.

On May 1, 2026 the company completed the all-cash acquisition of PayneCrest Electric, valued at about $404.7 million net of cash acquired 2. PayneCrest builds electrical systems for industrial, manufacturing and advanced facilities, and the deal raised the company's exposure to data center work 2.

Utilities segment

The Utilities segment builds and maintains natural gas and electric distribution and transmission systems and communications systems across the United States 3. Its third-quarter 2026 revenue was $770.9 million, up from $737.5 million, and its gross profit was 13.0 percent of revenue against 11.7 percent 1. Its backlog was about $8.1 billion, mostly service-agreement work 1.

Energy segment

The Energy segment does engineering, procurement, construction and maintenance for energy, renewable energy and storage, renewable fuels, petroleum and petrochemical customers, and for state transportation departments, in the United States and Canada 3. Its third-quarter revenue fell to $1,223.8 million from $1,485.7 million, and its gross profit was 8.5 percent of revenue against 10.1 percent 1. Energy backlog was $6.0 billion, including about $593.6 million from PayneCrest 1.

Customers and contracts

Work under multi-year service agreements was 32.0 percent of 2025 revenue 3. The ten largest customers supplied 53.1 percent of 2025 revenue, up from 41.3 percent in 2024, and the annual report names Xcel Energy, Pacific Gas & Electric and Duke Energy among its customers 3.

People and rivals

At the end of 2025 the company employed 3,055 salaried and 15,471 hourly workers, and about 30 percent of hourly workers were covered by collective bargaining agreements 3. Koti Vadlamudi is president and chief executive and Ken Dodgen is chief financial officer 1.

James Greer, a former chief operating officer of Oncor, and Oscar Brown, chief executive of Western Midstream Partners, joined the board on October 1, 2026 7. The annual report names Quanta Services, Dycom, MYR Group and MasTec as utilities rivals, and Blattner Energy and Mortenson in renewables 3.

Current problems

The putative class action filed on 21 July 2026 in the Northern District of Texas is pending, and the company said it intends to defend it vigorously and cannot yet estimate a possible loss 2. Bid and payment bonds outstanding were about $10.1 billion on 30 September 2026 2.

The umbrella, in words

Primoris operates through subsidiaries that its annual report lists as Exhibit 21.1, among them Primoris Power Delivery, Primoris Renewable Energy, Primoris Pipeline, James Construction Group, Rockford Corporation, PLH Group, Future Infrastructure and Willbros Group 8.

The company leases its executive offices in Dallas and, at the end of 2025, owned 44 of its other facilities and leased the rest 3. BlackRock reported holding 14.7 percent of the shares, Vanguard 11.4 percent and Fuller & Thaler Asset Management 5.3 percent, and directors and officers as a group held 1.1 percent 6.

After the third quarter the company updated its 2026 guidance: net income of $65.2 million to $73.2 million and adjusted EBITDA of $290.0 million to $310.0 million 1. It expects earnings per diluted share of $1.20 to $1.35, or $2.10 to $2.25 on its adjusted basis 1.

For the last three months of 2026 the company expects capital spending of $30.0 million to $40.0 million 1. Its board declared a dividend of $0.08 per share for holders of record on December 31, 2026, payable around January 15, 2027 1.

The sixth challenged renewables project is expected to be materially complete in the fourth quarter of 2026 2. The company is also searching for a permanent chief operating officer, and Vadlamudi was managing most of those duties in June 4.

Greer and Brown stand for election at the 2027 annual meeting 7. The amended credit agreement runs to May 1, 2031 and includes a $750.0 million revolving facility 2.