Adjusted earnings increased 39% and adjusted EBITDA rose 9%, with adjusted EBITDA margin improving over 400 basis points to 30.1%.
Adjusted gross margin improved by 600 basis points, leading to a 9% increase in adjusted gross profit.
A noncash goodwill impairment charge of $184 million was recorded for the APT segment due to shifts in customer order patterns and higher discount rates.
APT segment sales dropped 10% due to weaker customer demand influenced by tariff uncertainty and competitive pressures, resulting in EBITDA of about $1 million for the quarter.
Free cash flow improved, enabling a reduction in net leverage to 3x, a full turn improvement in less than a year.
Performance Chemicals sales declined about 10% due to repositioning and wet weather impacts, but segment EBITDA more than tripled year-over-year with margins approaching 20%.
Performance Materials delivered EBITDA margins above 50%, though sales declined 2% due to regional variances and tariff-related uncertainty.
Second quarter sales were $365 million, down 7% year-over-year primarily due to repositioning actions in Industrial Specialties, wet weather impacting Road Tech paving activity, and indirect tariff impacts on APT volumes in Europe.
Backlog excluding USAID and Department of State was $4.15 billion, slightly up from Q2, with nearly $2 billion in new U.S. federal contract capacity added in the quarter.
Commercial/International Group (CIG) segment revenue was $633 million, up slightly, with a margin of 15.2%, up 130 basis points, supported by growth in U.K. and EU operations but offset by declines in U.S. commercial and Australian activities.
Government Services Group (GSG) segment revenue increased 29% to $429 million with a margin of 19.9%, up 230 basis points, driven by disaster response and reduction of lower margin USAID work.
International revenue was flat, down 1% year-over-year, with growth in U.K. and Ireland offset by declines in Australia.
Net revenue increased 11% year-over-year to $1.06 billion, excluding USAID and Department of State work.
State and local revenue grew 30% year-over-year, with ongoing water programs up 18% excluding episodic disaster response.
Tetra Tech reported record highs for operating income and earnings per share in Q3 fiscal 2025, with operating income of $159 million, up 37% year-over-year, and EPS of $0.41, up 46%.
U.S. federal work was up 46% year-over-year, representing about 25% of total business, with disaster response contributing $70 million.
Free cash flow outlook remains unchanged despite higher adjusted EBITDA guidance due to timing and prudence around a large Canadian receivable.
Quanta Services reported strong second quarter 2025 results with revenues of $6.8 billion, net income attributable to common stock of $229 million or $1.52 per diluted share, adjusted diluted earnings per share of $2.48, and adjusted EBITDA of $669 million.
Record backlog reached $35.8 billion along with other record financial metrics.
Second quarter performance was ahead of expectations across most financial metrics and similar to the first quarter.
The company generated healthy cash flows with cash flow from operations of $296 million and free cash flow of $170 million in Q2.
The company is seeing mid-single digit organic top-line growth and close to double-digit EPS growth organically.
Dafinchi