Centuri Q3 Revenue Rises 40% as Pipeline Reaches $19 Billion

Centuri Holdings reported record third-quarter revenue and gross profit as growth across its infrastructure operations lifted adjusted earnings, while a larger opportunity pipeline and expected master service agreement renewals supported management’s outlook for additional bookings.

The infrastructure services company generated $1.19 billion in revenue in the third quarter of 2026, up 40.2% from $850.0 million a year earlier. Gross profit rose 45.4% to $113.4 million, while gross profit margin reached 9.5%, compared with 7.2% in the second quarter of 2026.

Net income attributable to common stock increased to $26.9 million, or $0.27 per diluted share, from $2.1 million, or $0.02 per share, a year earlier. Adjusted net income climbed 154.9% to $42.5 million, and adjusted earnings per share more than doubled to $0.42 from $0.19.

Adjusted EBIT rose 79.4% to $73.0 million, while adjusted EBITDA increased 43.6% to $108.0 million. Adjusted EBITDA margin was 9.1%, up from 8.8% in the prior-year quarter.

Growth Across Operating Segments

All four operating segments posted year-over-year gross profit growth. U.S. Gas remained the largest contributor, with gross profit rising 50% to $47.5 million. Union Electric gross profit increased 61% to $31.4 million, Canadian Operations advanced 19% to $19.3 million, and Non-Union Electric grew 43% to $15.2 million.

Centuri said its margin strategy centers on pricing discipline, project selectivity, higher-margin bid work, fleet efficiency and efforts to reduce first-quarter seasonality in U.S. Gas. The company is targeting an incremental gross profit margin of 12% to 15%. It is also implementing more detailed margin analytics by customer, work scope and geography while seeking to improve crew and fleet utilization.

The July 2026 acquisition of JJ White for about $58 million in cash expanded Centuri’s Union Electric operations and added industrial mechanical and electrical maintenance and construction capabilities. The acquired business is expected to contribute more than $20 million in annual gross profit.

Pipeline and Bookings Support Visibility

Third-quarter bookings totaled approximately $730 million, including $630 million of new awards and $100 million of MSA renewals. New awards included about $445 million of bid work and $185 million of new or expanded MSAs. Projects covered data-center mechanical improvements, a high-pressure gas pipeline upgrade and an electric transmission rebuild in the Southeast.

Backlog ended the quarter at $6.2 billion, 5% above the prior-year level. Gas represented 66% of backlog and electric work accounted for 34%, while MSAs comprised 81% and bid work made up the remainder.

Centuri’s unweighted opportunity pipeline increased 19% from the second quarter to approximately $19 billion, encompassing about 700 bid opportunities. Electric work represented 64% of the pipeline, with gas accounting for 36%.

The company highlighted data centers as a significant source of potential work. It has secured approximately $370 million of aggregate data-center awards to date and is tracking roughly 40 opportunities with a combined value of about $4.9 billion.

Year-to-date bookings were $2.9 billion, producing a book-to-bill ratio of 1.01 times. With nearly $4.8 billion of outstanding bids, including about $2 billion of MSA renewals expected by year-end, management anticipates exceeding its full-year 2026 book-to-bill target of 1.2 times.

Outlook and Balance Sheet

Centuri’s 2026 guidance calls for revenue of $3.8 billion to $3.9 billion, adjusted gross profit of $305 million to $315 million, adjusted EBITDA of $290 million to $300 million and adjusted net income of $80 million to $90 million. Net capital expenditures are expected to range from $60 million to $70 million. The guidance assumes no fourth-quarter contribution from storm-restoration services.

Preliminary 2027 targets include mid-teens percentage revenue growth and a gross profit margin of 8.5% to 9%.

Net debt stood at $774.1 million at the end of the third quarter, down from $928.5 million a year earlier. The net debt-to-adjusted EBITDA ratio declined to 2.6 times from 3.8 times, and Centuri expects the measure to finish 2026 in the low-2-times range. Following debt refinancing and repricing completed in 2025 and early 2026, the company expects interest expense to fall by at least 30% in 2026.

Free cash flow remained negative, however, at $30.4 million for the quarter, compared with negative $16.3 million a year earlier. For the first nine months of 2026, free cash flow was negative $90.9 million versus negative $69.9 million in the comparable 2025 period. Centuri is pursuing a long-term fleet funding mix of 50% leasing and 50% purchases to improve cash generation and balance-sheet flexibility.

The company identified several uncertainties that could affect its targets, including MSA renewal rates, execution of higher-value bid work, acquisition integration, workforce recruitment and retention, fleet leasing and supply-chain risks. Results may also be affected by economic, political, regulatory, weather-related and broader industry conditions.