Gross Revenue Grew 6.6% y/y, Adj. Net Revenue Grew 5.8% y/y in Fiscal Fourth Quarter 2025
Backlog Reached New Record with TTM Book-to-Bill Ratio of 1.1x
Returned a Record $1.1 billion Through Repurchases and Dividends in Fiscal 2025
Fiscal 2026 Guidance for 16% Growth in Adj. EPS, at Midpoint
DALLAS, Nov. 20, 2025 /PRNewswire/ -- Jacobs Solutions Inc. $(J)$ today announced its financial results for the fiscal fourth quarter and fiscal year ended September 26, 2025.
Q4 2025 Financial Highlights(1) :
-- Gross revenue of $3.2 billion up 6.6% y/y; adjusted net revenue2 of $2.2
billion up 5.8% y/y
-- GAAP net earnings of $138 million decreased (55.4)% y/y, impacted by
mark-to-market gains/losses in the comparable period from our previous
stake in Amentum stock; adjusted EBITDA2 of $324 million increased 12.0%
y/y
-- GAAP EPS of $1.05 decreased (55.9)% y/y; adjusted EPS2 of $1.75 increased
27.7% y/y
-- Backlog of $23.1 billion, up 5.6% y/y; Q4 book-to-bill of 1.1x (1.1x TTM)
Fiscal Year 2025 Financial Highlights(1) :
-- Gross revenue of $12.0 billion up 4.6% y/y; adjusted net revenue2 of $8.7
billion up 5.3% y/y
-- GAAP net earnings of $313 million decreased (48.9)% y/y, impacted by
mark-to-market gains/losses in the comparable period from our previous
stake in Amentum stock; adjusted EBITDA2 of $1.2 billion increased 13.9%
y/y
-- GAAP EPS of $2.58 decreased (46.1)% y/y; adjusted EPS2 of $6.12 increased
15.9% y/y
-- Cash conversion and reported free cash flow conversion2 exceeded 100%
Jacobs' Chair and CEO Bob Pragada commented, "We are pleased to have met or exceeded all our key metrics for FY25. We grew revenue organically mid-single-digits year-over-year and expanded our operating margin meaningfully. The Life Sciences, Data Center, Water, Energy & Power and Transportation sectors drove Infrastructure & Advanced Facilities' (I&AF) revenue growth in FY25, and we anticipate these sectors will remain strong in FY26 and beyond. Additionally, PA Consulting saw revenue growth accelerate during the fiscal year, contributing positively to consolidated results. We enter FY26 with multiple secular tailwinds, clear line-of-sight to continued synergistic expansion with PA Consulting and a record backlog, positioning us for profitable growth."
Jacobs' CFO Venk Nathamuni added, "We exited the first year of our strategy cycle above the high-end of the annual 50-80 basis point margin expansion target we established at our February Investor Day, and we are forecasting further margin improvement in FY26. We delivered a record $1.1 billion of capital back to shareholders during FY25 through share repurchases and dividends, and we plan to continue returning capital to shareholders given the strength of our balance sheet and our outlook for cash generation. We are starting FY26 with a record backlog, and we anticipate growth in revenue, margins, EPS and free cash flow for the full fiscal year."
Financial Outlook(3)
The Company's outlook for fiscal 2026 is for adjusted net revenue to grow 6% to 10% over fiscal 2025, adjusted EBITDA margin to range from 14.4% to 14.7%, adjusted EPS to range from $6.90 to $7.30 and for free cash flow margin to range from 7.0% to 8.0%.
(1) All data reflects continuing operations only. (2) See Non-GAAP Financial Measures and Operating Metrics, and GAAP Reconciliations at the end of the press release for additional detail. (3) Reconciliation of fiscal 2026 adjusted EBITDA margin, adjusted EPS and expectations for adjusted net revenue growth and reported free cash flow margin to the most directly comparable GAAP measure is not available without unreasonable efforts because the Company cannot predict with sufficient certainty all the components required to provide such reconciliation, including with respect to the costs and charges relating to transaction expenses, restructuring and integration to be incurred in fiscal 2026.
Fourth Quarter Review (in thousands, except for per share and tax rate data)
Fiscal Q4 2025 Fiscal Q4 2024 Change
---------------------------------- -------------- -------------- ----------
Revenue $3,154,644 $2,960,150 $194,494
---------------------------------- -------------- -------------- ----------
Adjusted Net Revenue(1) $2,242,246 $2,118,930 $123,316
---------------------------------- -------------- -------------- ----------
GAAP Net Earnings from Continuing
Operations $138,036 $309,299 ($171,263)
---------------------------------- -------------- -------------- ----------
GAAP Earnings Per Diluted Share
(EPS) from Continuing Operations $1.05 $2.38 $(1.33)
---------------------------------- -------------- -------------- ----------
Adjusted Net Earnings from
Continuing Operations(1) $209,437 $170,480 $38,957
---------------------------------- -------------- -------------- ----------
Adjusted EPS from Continuing
Operations(1) $1.75 $1.37 $0.38
---------------------------------- -------------- -------------- ----------
U.S. GAAP effective tax rate from
Continuing Operations 28.6 % 18.9 % 970 bps
---------------------------------- -------------- -------------- ----------
Adjusted effective tax rate from
Continuing Operations(1) 22.7 % 27.5 % (480) bps
---------------------------------- -------------- -------------- ----------
(1) See "Non-GAAP Financial Measures and Operating Metrics" and the GAAP
Reconciliation tables that follow for additional detail.
Fiscal 2025 Review (in thousands, except for per share and tax rate data)
Fiscal 2025 Fiscal 2024 Change
---------------------------------------- ----------- ----------- ----------
Revenue $12,029,783 $11,500,941 $528,842
---------------------------------------- ----------- ----------- ----------
Adjusted Net Revenue(1) $8,694,965 $8,259,301 $435,664
---------------------------------------- ----------- ----------- ----------
GAAP Net Earnings from Continuing
Operations $313,302 $612,804 ($299,502)
---------------------------------------- ----------- ----------- ----------
GAAP Earnings Per Diluted Share (EPS)
from Continuing Operations $2.58 $4.79 $(2.21)
---------------------------------------- ----------- ----------- ----------
Adjusted Net Earnings from Continuing
Operations(1) $745,615 $665,076 $80,539
---------------------------------------- ----------- ----------- ----------
Adjusted EPS from Continuing
Operations(1) $6.12 $5.28 $0.84
---------------------------------------- ----------- ----------- ----------
U.S. GAAP effective tax rate from
Continuing Operations 39.7 % 16.9 % 2,280 bps
---------------------------------------- ----------- ----------- ----------
Adjusted effective tax rate from
Continuing Operations(1) 25.1 % 19.6 % 550 bps
---------------------------------------- ----------- ----------- ----------
(1) See "Non-GAAP Financial Measures and Operating Metrics" and the GAAP
Reconciliation tables that follow for additional detail.
Jacobs is hosting a conference call at 10:00 A.M. ET on Thursday November 20, 2025, which will be webcast live at www.jacobs.com.
Forward-Looking Statements
Certain statements contained in this press release constitute forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that do not directly relate to any historical or current fact. When used herein, words such as "expects," "anticipates, " "believes," "seeks," "estimates," "plans," "intends," "future," "will, " "would," "could," "can," "may," "target," "goal" and similar words are intended to identify forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements we make concerning our expectations as to our future growth, prospects, financial outlook and business strategy, including our expectations for our fiscal year 2026 adjusted EBITDA margin, adjusted EPS, adjusted net revenue growth, reported free cash flow conversion and free cash flow margin, as well as our expectations for our effective tax rates. Although such statements are based on management's current estimates and expectations, and/or currently available competitive, financial, and economic data, forward-looking statements are inherently uncertain, and you should not place undue reliance on such statements as actual results may differ materially. We caution the reader that there are a variety of risks, uncertainties and other factors that could cause actual results to differ materially from what is contained, projected or implied by our forward-looking statements. Such factors include:
-- general economic conditions, including inflation and the actions taken by
monetary authorities in response to inflation, changes in interest rates
and foreign currency exchange rates, changes in capital markets and stock
market volatility, instability in the banking industry, labor shortages,
or the impact of a possible recession or economic downturn or changes to
monetary or fiscal policies or priorities in the U.S. and the other
countries where we do business on our results, prospects and
opportunities;
-- competition from existing and future competitors in our target markets,
as well as the possible reduction in demand for certain of our product
solutions and services, including delays in the timing of the award of
projects or reduction in funding, or the abandonment of ongoing or
anticipated projects due to the financial condition of our clients and
suppliers or due to governmental budget constraints or changes to
governmental budgetary priorities, or the inability of our clients to
meet their payment obligations in a timely manner or at all;
-- our ability to fully execute on our corporate strategy, including the
impact of acquisitions, strategic alliances, divestitures, and other
strategic events resulting from evolving business strategies, including
on our ability to maintain our culture and retain key personnel,
customers or suppliers, or our ability to achieve the cost-savings and
synergies contemplated by our recent acquisitions within the expected
time frames or to achieve them fully and to successfully integrate
acquired businesses while retaining key personnel, and our ability to
invest in the tools needed to implement our strategy;
-- financial market risks that may affect us, including by affecting our
access to capital, the cost of such capital and/or our funding
obligations under defined benefit pension and postretirement plans;
-- legislative changes, including potential changes to the amounts provided
for under the Infrastructure Investment and Jobs Act, as well as other
legislation and executive orders related to governmental spending,
including any directive to federal agencies to reduce federal spending or
the size of the federal workforce, including the tax legislation enacted
in the U.S. in July 2025, and changes in U.S. or foreign tax laws,
statutes, rules, regulations or ordinances, including the impact of, and
changes to tariffs and retaliatory tariffs or trade policies, that may
adversely impact our future financial positions or results of operations;
-- increased geopolitical uncertainty and risks, including policy risks and
potential civil unrest, relating to the outcome of elections across our
key markets and elevated geopolitical tension and conflicts, including
the Russia-Ukraine and Israel-Hamas conflicts and the escalating tensions
in the Middle East, among others; and
-- the impact of any pandemic, and any resulting economic downturn on our
results, prospects and opportunities, measures or restrictions imposed by
governments and health officials in response to the pandemic, as well as
the inability of governments in certain of the countries in which we
operate to effectively mitigate the financial or other impacts of any
future pandemics or infectious disease outbreaks on their economies and
workforces and our operations therein.
The foregoing factors and potential future developments are inherently uncertain, unpredictable and, in many cases, beyond our control. For a description of these and additional factors that may occur that could cause actual results to differ from our forward-looking statements see the Company's filings with the U.S. Securities and Exchange Commission, including in particular the discussions contained in our fiscal 2025 Annual Report on Form 10-K under Item 1 - Business, Item 1A - Risk Factors, Item 3 - Legal Proceedings, and Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations. The Company is not under any duty to update any of the forward-looking statements after the date of this press release to conform to actual results, except as required by applicable law.
Regulation FD
We use any of the following to comply with our disclosure obligations under Regulation FD: press releases, SEC filings, public conference calls, or our website. We routinely post important information on our website at www.jacobs.com, including information that may be deemed to be material. We encourage investors and others interested in the Company to monitor these distribution channels for material disclosures.
About Jacobs
At Jacobs, we're challenging today to reinvent tomorrow -- delivering outcomes and solutions for the world's most complex challenges. With approximately $12 billion in annual revenue and a talent force of almost 43,000, we provide end-to-end services in advanced manufacturing, cities & places, energy, environmental, life sciences, transportation and water. From advisory and consulting, feasibility, planning, design, program and lifecycle management, we're creating a more connected and sustainable world. See how at jacobs.com and connect with us on LinkedIn, Instagram, X and Facebook.
Financial Highlights:
Results of Operations (in thousands, except per-share data):
--------------------------------------------------------------------------------------------------------------
For the Three Months Ended For the Years Ended
----------------------------------------- ------------------------------------
September September September September
Quarterly data unaudited 26, 2025 27, 2024 26, 2025 27, 2024
----------------------------- ---------------------- ----------------- ----------------- -----------------
Revenues $ 3,154,644 $ 2,960,150 $ 12,029,783 $ 11,500,941
Direct cost of contracts (2,387,732) (2,225,029) (9,044,849) (8,668,185)
---------------------- ----------------- ----------------- -----------------
Gross profit 766,912 735,121 2,984,934 2,832,756
Selling, general and
administrative expenses (555,358) (538,916) (2,121,300) (2,140,320)
---------------------- ----------------- ----------------- -----------------
Operating Profit 211,554 196,205 863,634 692,436
Other Income (Expense):
Interest income 8,326 8,514 35,804 34,454
Interest expense (35,337) (35,686) (145,788) (169,058)
Loss on extinguishment of
debt -- -- (20,510) --
Miscellaneous income
(expense), net 4,861 224,573 (189,663) 219,454
---------------------- ----------------- ----------------- -----------------
Total other (expense) income,
net (22,150) 197,401 (320,157) 84,850
---------------------- ----------------- ----------------- -----------------
Earnings from Continuing
Operations Before Taxes 189,404 393,606 543,477 777,286
Income Tax Expense for
Continuing Operations (54,078) (74,467) (215,555) (131,493)
---------------------- ----------------- ----------------- -----------------
Net Earnings of the Group
from Continuing Operations 135,326 319,139 327,922 645,793
Net (Loss) Earnings of the
Group from Discontinued
Operations, net of tax (15,786) 19,618 (23,966) 206,850
---------------------- ----------------- ----------------- -----------------
Net Earnings of the Group 119,540 338,757 303,956 852,643
Net Earnings Attributable to
Noncontrolling Interests
from Continuing Operations (4,652) (4,953) (3,443) (17,990)
Net Loss (Earnings)
Attributable to Redeemable
Noncontrolling Interests 7,362 (4,887) (11,177) (14,999)
---------------------- ----------------- ----------------- -----------------
Net Earnings Attributable to
Jacobs from Continuing
Operations 138,036 309,299 313,302 612,804
Net Earnings Attributable to
Noncontrolling Interests
from Discontinued
Operations -- (3,480) -- (13,561)
Net (Loss) Earnings
Attributable to Jacobs from
Discontinued Operations (15,786) 16,138 (23,966) 193,289
---------------------- ----------------- ----------------- -----------------
Net Earnings Attributable to
Jacobs $ 122,250 $ 325,437 $ 289,336 $ 806,093
====================== ================= ================= =================
Net Earnings Per Share:
Basic Net Earnings from
Continuing Operations
Per
Share $ 1.06 $ 2.39 $ 2.59 $ 4.81
Basic Net (Loss) Earnings
from Discontinued
Operations Per Share $ (0.13) $ 0.13 $ (0.20) $ 1.54
---------------------- ----------------- ----------------- -----------------
Basic Earnings Per Share $ 0.93 $ 2.52 $ 2.39 $ 6.35
====================== ================= ================= =================
Diluted Net Earnings from
Continuing Operations Per
Share $ 1.05 $ 2.38 $ 2.58 $ 4.79
Diluted Net (Loss) Earnings
from Discontinued
Operations Per Share $ (0.13) $ 0.13 $ (0.20) $ 1.54
---------------------- ----------------- ----------------- -----------------
Diluted Earnings Per Share $ 0.92 $ 2.51 $ 2.38 $ 6.32
====================== ================= ================= =================
Segment Information (in thousands):
-----------------------------------------------------------------------------------------------------------------------------
For the Three Months Ended For the Year Ended
----------------------------------------------------- ----------------------------------------------------
Quarterly data
unaudited September 26, 2025 September 26, 2025
---------------- ----------------------------------------------------- ----------------------------------------------------
Infrastructure Infrastructure
& Advanced & Advanced
Facilities PA Consulting Total Facilities PA Consulting Total
---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Revenues from
External
Customers (1) $ 2,836,183 $ 318,461 $ 3,154,644 $ 10,764,206 $ 1,265,577 $ 12,029,783
Pass Through
Revenue (912,398) -- (912,398) (3,334,818) -- (3,334,818)
---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Adjusted Net
Revenue $ 1,923,785 $ 318,461 $ 2,242,246 $ 7,429,388 $ 1,265,577 $ 8,694,965
Direct cost of
contracts (2,176,638) (211,094) (2,387,732) (8,228,935) (815,914) (9,044,849)
Selling, general
and
administrative
expenses (405,513) (35,370) (440,883) (1,631,723) (171,164) (1,802,887)
---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Segment
Operating
Profit (1) $ 254,032 $ 71,997 $ 326,029 $ 903,548 $ 278,499 $ 1,182,047
Restructuring,
Transaction
and Other
Charges (2) (74,904) (162,896)
Amortization of
Intangible
Assets (39,571) (155,517)
---------------- ----------------
Total U.S. GAAP
Operating
Profit $ 211,554 $ 863,634
Total Other
(Expense)
Income, net
(3) (22,150) (320,157)
---------------- ----------------
Earnings from
Continuing
Operations
Before Taxes $ 189,404 $ 543,477
================ ================
(1) I&AF revenue and operating profit for the year ended September 26, 2025
were impacted by a reserve in connection with an unfavorable interim
ruling against a consolidated joint venture in which the Company holds a
50% interest (the "Consolidated JV Matter"), with the noncontrolling
partner's share included in noncontrolling interests in the Consolidated
Statements of Earnings for the respective period.
(2) The three months ended September 26, 2025 included $11.7 million in
restructuring and other charges related to the Separation Transaction
(primarily professional services and employee separation costs), as well
as $54.8 million in charges for certain subsidiary level compensation
based agreements. The three months ended September 26, 2025 included
approximately $5.1 million in charges associated with the Company's TSA
with Amentum.
The year ended September 26, 2025 included $58.8 million in restructuring
and other charges related to the Separation Transaction (primarily
professional services and employee separation costs), as well as
$75.3 million in charges for certain subsidiary level compensation based
agreements. The year ended September 26, 2025 included approximately
$26.0 million in charges associated with the Company's TSA with Amentum.
(3) The three months ended September 26, 2025 included income associated with
the Company's TSA with Amentum.
The year ended September 26, 2025 included $227.3 million in
mark-to-market losses and other related charges associated with our
investment in Amentum stock in connection with the Separation
Transaction, as well as $40.5 million in income associated with the
Company's TSA with Amentum. The year ended September 26, 2025 included
$20.5 million in discounts and expenses associated with the
Equity-for-Debt Transaction.
For the Three Months Ended For the Year Ended
----------------------------------------------------- ----------------------------------------------------
September 27, 2024 September 27, 2024
-----------------------------------------------------
Infrastructure Infrastructure
& Advanced & Advanced
Facilities PA Consulting Total Facilities PA Consulting Total
---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Revenues from
External
Customers $ 2,670,703 $ 289,447 $ 2,960,150 $ 10,323,255 $ 1,177,686 $ 11,500,941
Pass Through
Revenue (841,220) -- (841,220) (3,241,640) -- (3,241,640)
---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Adjusted Net
Revenue $ 1,829,483 $ 289,447 $ 2,118,930 $ 7,081,615 $ 1,177,686 $ 8,259,301
Direct cost of
contracts (2,040,739) (184,290) (2,225,029) (7,915,256) (752,929) (8,668,185)
Selling, general
and
administrative
expenses (411,249) (43,420) (454,669) (1,609,624) (185,507) (1,795,131)
---------------- ----------------- ---------------- ---------------- ---------------- ----------------
Segment
Operating
Profit $ 218,715 $ 61,737 $ 280,452 $ 798,375 $ 239,250 $ 1,037,625
Restructuring,
Transaction
and Other
Charges (1) (45,299) (192,522)
Amortization of
Intangible
Assets (38,948) (152,667)
---------------- ----------------
Total U.S. GAAP
Operating
Profit $ 196,205 $ 692,436
Total Other
Income
(Expense), net
(2) 197,401 84,850
---------------- ----------------
Earnings from
Continuing
Operations
Before Taxes $ 393,606 $ 777,286
================ ================
(1) The three months ended September 27, 2024 included $43.2 million in
restructuring and other charges relating to the Separation Transaction
(primarily professional services and employee separation costs), as well
as certain subsidiary level compensation based agreements.
The year ended September 27, 2024 included $163.4 million in
restructuring and other charges related to the Separation Transaction
(primarily professional services and employee separation costs) and $6.4
million in restructuring and other charges related to the Company's
investment in PA Consulting (primarily employee separation costs), as
well as certain subsidiary level compensation based agreements.
(2) The three months and year ended September 27, 2024 included $186.9
million in mark-to-market gains associated with our investment in Amentum
stock in connection with the Separation Transaction and a $35.2 million
realized gain on interest rate swaps settled during the fourth quarter of
fiscal 2024.
Balance Sheet (in thousands):
---------------------------------------------------------------------------------------
September 26, September 27,
2025 2024
----------------------- -----------------------
ASSETS
Current Assets:
Cash and cash equivalents $ 1,235,448 $ 1,144,795
Receivables and contract assets 2,989,067 2,845,452
Prepaid expenses and other 134,804 155,865
Investment in equity securities -- 749,468
----------------------- -----------------------
Total current assets 4,359,319 4,895,580
----------------------- -----------------------
Property, Equipment and Improvements,
net 311,872 315,630
----------------------- -----------------------
Other Noncurrent Assets:
Goodwill 4,780,818 4,788,181
Intangibles, net 717,670 874,894
Deferred income tax assets 325,814 195,406
Operating lease right-of-use
assets 289,101 303,856
Miscellaneous 467,941 385,458
----------------------- -----------------------
Total other noncurrent assets 6,581,344 6,547,795
----------------------- -----------------------
$ 11,252,535 $ 11,759,005
======================= =======================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current maturities of long-term
debt $ -- $ 875,760
Accounts payable 1,261,489 1,029,140
Accrued liabilities 1,037,754 1,087,764
Operating lease liability 111,040 119,988
Contract liabilities 940,616 967,089
----------------------- -----------------------
Total current liabilities 3,350,899 4,079,741
----------------------- -----------------------
Long-term debt 2,236,456 1,348,594
Liabilities relating to defined
benefit pension and retirement
plans 272,069 298,221
Deferred income tax liabilities 151,821 116,655
Long-term operating lease liability 362,361 407,826
Other deferred liabilities 212,330 120,483
----------------------- -----------------------
Total other noncurrent
liabilities 3,235,037 2,291,779
----------------------- -----------------------
Commitments and Contingencies
Redeemable Noncontrolling Interests 1,018,694 820,182
Stockholders' Equity:
Capital stock:
Preferred stock, $1 par value,
authorized - 1,000,000 shares;
issued and outstanding - none -- --
Common stock $1 par value,
authorized - 240,000,000
shares; issued
and
outstanding - 119,081,294
shares and 124,084,028 shares
as of September 26, 2025 and
September 27, 2024,
respectively 119,081 124,084
Additional paid-in capital 2,706,376 2,758,064
Retained earnings 1,525,760 2,366,769
Accumulated other comprehensive
loss (710,410) (699,450)
----------------------- -----------------------
Total Jacobs stockholders'
equity 3,640,807 4,549,467
Noncontrolling interests 7,098 17,836
----------------------- -----------------------
Total Group stockholders'
equity 3,647,905 4,567,303
----------------------- -----------------------
$ 11,252,535 $ 11,759,005
======================= =======================
Cash Flows (in thousands) (Quarterly data unaudited)
For the Three Months Ended For the Years Ended
------------------------------------ ------------------------------------
September 26, September 27, September 26, September 27,
2025 2024 2025 2024
----------------- ----------------- ----------------- -----------------
Cash Flows from
Operating
Activities:
Net earnings
attributable to
the Group $ 119,540 $ 338,757 $ 303,956 $ 852,643
Adjustments to
reconcile net
earnings to net
cash flows
provided by
operations:
Depreciation and
amortization:
Property,
equipment and
improvements 20,021 25,061 82,059 99,232
Intangible
assets 39,571 53,215 155,517 209,507
Loss on
extinguishment of
debt -- -- 20,510 --
(Gain) loss on
investment in
equity
securities -- (186,931) 227,305 (186,931)
Stock based
compensation 13,539 20,023 60,960 74,193
Equity in earnings
of operating
ventures, net of
return on capital
distributions (1,023) (2,525) (1,526) (16,079)
Loss (gain) on
disposals of
assets, net 55 (4,233) (722) (3,200)
Impairment of
equity method
investment and
other long-term
assets -- 3,000 -- 3,000
Deferred income
taxes (40,738) (108,832) (94,532) (224,935)
Changes in assets
and liabilities,
excluding the
effects of
businesses
acquired:
Receivables
and contract
assets, net
of contract
liabilities 47,403 36,147 (177,877) 59,587
Prepaid
expenses and
other current
assets (7,785) (43,295) 8,383 11,217
Miscellaneous
other assets 11,016 35,993 60,586 104,659
Accounts
payable 134,931 (35,751) 231,254 81,469
Income taxes
payable (17,329) 101,120 (183,273) 94,094
Accrued
liabilities (1,956) (37,808) (64,945) (138,491)
Other deferred
liabilities 65,039 (16,196) 75,231 6,047
Other, net 801 18,787 (16,182) 28,661
----------------- ----------------- ----------------- -----------------
Net cash
provided by
operating
activities 383,085 196,532 686,704 1,054,673
----------------- ----------------- ----------------- -----------------
Cash Flows from
Investing
Activities:
Additions to
property and
equipment (29,577) (38,342) (79,232) (121,114)
Disposals of
property and
equipment and
other assets -- 6,029 2,332 6,187
Capital
contributions to
equity investees,
net of return of
capital
distributions 677 77 1,609 1,737
Acquisitions of
businesses, net
of cash acquired -- -- -- (14,000)
Net cash used
for investing
activities (28,900) (32,236) (75,291) (127,190)
----------------- ----------------- ----------------- -----------------
Cash Flows from
Financing
Activities:
Proceeds from
long-term
borrowings 285,000 2,382,120 2,458,201 4,606,697
Repayments of
long-term
borrowings (545,000) (1,175,932) (1,471,800) (3,370,355)
Proceeds from
short-term
borrowings -- 4,239 -- 5,345
Repayments of
short-term
borrowings -- (834,879) (656,981) (866,761)
Debt issuance
costs -- (32,725) (92) (34,331)
Proceeds from
issuances of
common stock 9,245 12,089 34,712 47,503
Common stock
repurchases (100,883) (56,286) (754,130) (402,668)
Taxes paid on
vested restricted
stock (458) (8,331) (27,450) (41,720)
Cash dividends to
shareholders (38,214) (36,340) (153,027) (142,779)
Net dividends
associated with
noncontrolling
interests (6,765) (4,162) (14,205) (21,678)
Repurchase of
redeemable
noncontrolling
interests (1,977) (13,556) (10,449) (55,344)
Proceeds from
issuances of
redeemable
noncontrolling
interests -- -- -- 19,761
Cash impact from
distribution of
SpinCo Business -- (495,307) 70,000 (495,307)
----------------- ----------------- ----------------- -----------------
Net cash used
for financing
activities (399,052) (259,070) (525,221) (751,637)
----------------- ----------------- ----------------- -----------------
Effect of Exchange
Rate Changes (14,297) 29,425 3,693 41,640
Net (Decrease)
Increase in Cash
and Cash
Equivalents and
Restricted Cash (59,164) (65,349) 89,885 217,486
Cash and Cash
Equivalents,
including
Restricted Cash,
at the Beginning
of the Period 1,295,980 1,212,280 1,146,931 929,445
----------------- ----------------- ----------------- -----------------
Cash and Cash
Equivalents,
including
Restricted Cash,
at the End of the
Period $ 1,236,816 $ 1,146,931 $ 1,236,816 $ 1,146,931
================= ================= ================= =================
Backlog (in millions):
-----------------------------------------------------------------------------------
Unaudited September 26, 2025 September 27, 2024
-----------------
Infrastructure &
Advanced
Facilities $ 22,649 $ 21,472
PA Consulting 415 378
------------------------------- -------------------------------
Total $ 23,064 $ 21,850
=============================== ===============================
Non-GAAP Financial Measures and Operating Metrics:
In this press release, the Company has included certain non-GAAP financial measures as defined in Regulation G promulgated under the Securities Exchange Act of 1934, as amended. These non-GAAP measures are described below.
As a result of the spin-off of the SpinCo Business and merger of the SpinCo Business with Amentum Parent Holdings LLC to form an independent, publicly traded company, Amentum Holdings, Inc. (NYSE: AMTM) (the "Separation Transaction"), substantially all CMS and C&I (the "SpinCo Business") related assets and liabilities were separated on September 27, 2024. As such, the financial results of the SpinCo Business are reflected as discontinued operations for all periods presented and therefore excluded from the non-GAAP measures described below.
Adjusted net revenue is calculated by adjusting revenue from continuing operations to exclude amounts we bill to clients on projects where we are procuring subcontract labor or third-party materials and equipment on behalf of the client (referred to as "pass throughs"). These amounts are considered pass throughs because we receive no or only a minimal mark-up associated with the billed amounts. In 2023, we amended our name and convention for revenue, excluding pass-through costs from "net revenue" to "adjusted net revenue." This name change is intended to make the non-GAAP nature of this measure more prominent and does not impact measurement. We sometimes refer to our GAAP revenue as "gross revenue".
Jacobs adjusted operating profit, adjusted earnings from continuing operations before taxes, adjusted income tax expenses from continuing operations, adjusted net earnings from continuing operations, adjusted EPS from continuing operations and adjusted interest expense are calculated by:
1. Excluding items collectively referred to as Restructuring, Transaction and
Other Charges, which include:
a. costs and other charges associated with our Focus 2023 Transformation
initiatives, including activities associated with the re-scaling and
repurposing of physical office space, employee separations,
contractual termination fees and related expenses, referred to as
"Focus 2023 Transformation, mainly real estate rescaling efforts";
b. transaction costs and other charges incurred in connection with
mergers, acquisitions, strategic investments and divestitures,
including advisor fees, change in control payments, and the impact of
the quarterly adjustment to the estimated performance based payout of
contingent consideration to certain sellers in connection with certain
acquisitions and similar transaction costs and expenses (collectively
referred to as "Transaction Costs");
c. recoveries, costs and other charges associated with (i) restructuring
activities, (ii) cost reduction initiatives implemented in connection
with mergers, acquisitions, strategic investments and divestitures,
including the separation of the CMS/C&I business, such as advisor
fees, involuntary terminations and related costs, costs associated
with co-locating offices of acquired companies, separating physical
locations of continuing operations, professional services and other
personnel costs, (iii) involuntary termination programs and other
related separations impacting management and employees, including
related transition costs, and (iv) certain legal costs and expenses to
the extent related to (i) - (iii) or determined to not be related to
continuing operations (clauses (i) -- (iv) collectively referred to as
"Restructuring, integration, separation and other charges").
2. Excluding items collectively referred to as "Other adjustments", which
include:
a. intangible assets amortization and impairment charges;
b. impact of certain subsidiary level contingent equity-based agreements
in connection with the transaction structure of our PA Consulting
investment;
c. impacts related to tax rate increases in the UK in a prior period;
d. revenue under the Company's transition services agreement (TSA)
included in other income for U.S. GAAP reporting purposes, and any
SG&A costs associated with the provision of such services;
e. pretax mark-to-market and other related gains or losses associated
with the Company's investment in Amentum stock recorded in connection
with the Separation Transaction;
f. discounts and expenses related to the one-time exchange of the
Company's investment in Amentum shares for a portion of the Company's
outstanding term loans, which term loans were canceled; and
g. impacts resulting from the EPS numerator adjustment relating to the
redeemable noncontrolling interests preference share repurchase and
reissuance activities.
We eliminate the impact of "Restructuring, integration, separation and other charges" because we do not consider these to be indicative of ongoing operating performance. Actions taken by the Company to enhance efficiencies are subject to significant fluctuations from period to period. The Company's management believes the exclusion of the amounts relating to the above-listed items improves the period-to-period comparability and analysis of the underlying financial performance of the business.
Adjustments to derive adjusted net earnings from continuing operations and adjusted EPS from continuing operations are calculated on an after-tax basis.
Free cash flow $(FCF)$ is calculated as net cash provided by operating activities from continuing operations as reported on the statement of cash flows less additions to property and equipment. FCF Margin is calculated as FCF divided by adjusted net revenue.
Adjusted EBITDA is calculated by adding income tax expense, depreciation expense and adjusted interest expense to, and deducting interest income from, adjusted net earnings attributable to Jacobs from continuing operations.
I&AF Operating Margin is a ratio of I&AF operating profit for the segment to the segment's adjusted net revenue.
Jacobs Adjusted Operating Margin is a ratio of adjusted operating profit for the Company to the Company's adjusted net revenue. For a reconciliation of revenue to adjusted net revenue, see "Segment Information".
We believe that the measures listed above are useful to management, investors and other users of our financial information in evaluating the Company's operating results and understanding the Company's operating trends by excluding or adding back the effects of the items described above and below, the inclusion or exclusion of which can obscure underlying trends. Additionally, management uses such measures in its own evaluation of the Company's performance, particularly when comparing performance to past periods, and believes these measures are useful for investors because they facilitate a comparison of our financial results from period to period.
This press release also contains certain financial and operating metrics which management believes are useful in evaluating the Company's performance. Backlog represents revenue or gross profit, as applicable, we expect to realize for work to be completed by our consolidated subsidiaries and our proportionate share of work to be performed by unconsolidated joint ventures. Gross margin in backlog refers to the ratio of gross profit in backlog to gross revenue in backlog. For more information on how we determine our backlog, see our Backlog Information in our most recent annual report filed with the Securities and Exchange Commission. Adjusted EBITDA margin refers to a ratio of adjusted EBITDA to adjusted net revenue. Cash conversion refers to a ratio of cash flow from operations to GAAP net earnings from continuing operations. Reported FCF conversion refers to a ratio of FCF to GAAP net earnings from continuing operations. Book-to-bill ratio is an operational measure representing the ratio of change in backlog since the prior reporting period plus reported revenue for the reporting period to the reported revenues for the same period. We regularly monitor these operating metrics to evaluate our business, identify trends affecting our business, and make strategic decisions.
The Company provides non-GAAP measures to supplement U.S. GAAP measures, as they provide additional insight into the Company's financial results. However, non-GAAP measures have limitations as analytical tools and should not be considered in isolation and are not in accordance with, or a substitute for, U.S. GAAP measures. In addition, other companies may define non-GAAP measures differently, which limits the ability of investors to compare non-GAAP measures of the Company to those used by our peer companies.
The following tables reconcile the components and values of U.S. GAAP earnings from continuing operations before taxes, income taxes from continuing operations, net earnings attributable to Jacobs from continuing operations, Diluted Net Earnings from Continuing Operations Per Share (which we refer to as EPS from continuing operations), to the corresponding "adjusted" amount, net cash provided by operating activities to reported free cash flow, and revenue to adjusted net revenue. For the comparable period presented below, such adjustments consist of amounts incurred in connection with the items described above. Amounts are shown in thousands, except for per-share data (note: earnings per share amounts may not total due to rounding).
Reconciliation of Earnings from Continuing Operations Before Taxes to Adjusted Earnings from Continuing
Operations Attributable to Jacobs Before Taxes (in thousands):
-----------------------------------------------------------------------------------------------------------
Three Months Ended For the Years Ended
-------------------------------------------- -------------------------------------------
September 26, September 27, September 26, September 27,
2025 2024 2025 2024
--------------------- --------------------- -------------------- ---------------------
Earnings from
Continuing
Operations
Before Taxes $ 189,404 $ 393,606 $ 543,477 $ 777,286
Restructuring,
Transaction and
Other Charges
(1):
Focus 2023
Transformation,
mainly real
estate
rescaling
efforts -- (10) -- 49
Transaction
costs 1,347 1,232 64 9,246
Restructuring,
integration,
separation and
other charges 13,659 7,234 61,316 134,862
Other
Adjustments
(2):
Transition
Services
Agreement, net (3,907) -- (14,475) --
Amortization of
intangibles 39,571 38,948 155,517 152,666
Mark-to-market
and other
related (gains)
losses on
investment in
Amentum stock -- (186,931) 227,305 (186,931)
Other 54,822 1,910 97,060 13,433
--------------------- --------------------- -------------------- ---------------------
Adjusted
Earnings from
Continuing
Operations
Before Taxes $ 294,896 $ 255,989 $ 1,070,264 $ 900,611
Adjusted
Earnings
Attributable to
Noncontrolling
Interests from
Continuing
Operations (18,421) (15,053) (55,764) (58,713)
--------------------- --------------------- -------------------- ---------------------
Adj. Earnings
from Continuing
Operations
attributable to
Jacobs before
Taxes $ 276,475 $ 240,936 $ 1,014,500 $ 841,898
===================== ===================== ==================== =====================
(1) Includes pre-tax charges primarily relating to the Separation Transaction
for the three months and years ended September 26, 2025 and September 27,
2024, as well as charges associated with various transaction costs and
activity associated with Company's restructuring and integration programs.
Includes real estate impairment charges associated with the Company's Focus
2023 Transformation program for the three months and year ended September 27,
2024.
(2) Includes pre-tax charges relating to amortization of intangible assets and
the impact of certain subsidiary level compensation based agreements for the
three months and years ended September 26, 2025 and September 27, 2024. The
year ended September 26, 2025, as well as three months and year ended
September 27, 2024 also include pretax mark-to-market gains and losses
associated with our investment in Amentum stock in connection with the
Separation Transaction and income under the Company's TSA with Amentum in
connection with the Separation Transaction for the three months and year ended
September 26, 2025. The year ended September 26, 2025 includes discounts and
expenses associated with the Company's non-cash equity for debt exchange
transacted on March 13, 2025.
Reconciliation of Income Tax Expense from Continuing Operations to Adjusted Income Tax Expense from
Continuing Operations (in thousands):
----------------------------------------------------------------------------------------------------------
Three Months Ended For the Years Ended
------------------------------------------ --------------------------------------------
September 26, September 27, September 26, September 27,
2025 2024 2025 2024
-------------------- -------------------- --------------------- ---------------------
Income Tax
Expense for
Continuing
Operations $ (54,078) $ (74,467) $ (215,555) $ (131,493)
Tax Effects of
Restructuring,
Transaction and
Other Charges
(1)
Focus 2023
Transformation,
mainly real
estate
rescaling
efforts -- 2 -- (12)
Transaction
costs (342) (174) 83 (1,428)
Restructuring,
integration,
separation and
other charges (3,480) 14,565 (16,949) (4,779)
Tax Effects of
Other
Adjustments (2)
Transition
Services
Agreement, net 996 -- 3,691 --
Amortization of
intangibles (10,119) (10,362) (39,776) (39,073)
Other (15) (20) (379) (36)
-------------------- -------------------- --------------------- ---------------------
Adjusted Income
Tax Expense
from Continuing
Operations $ (67,038) $ (70,456) $ (268,885) $ (176,821)
==================== ==================== ===================== =====================
Adjusted
effective tax
rate from
Continuing
Operations 22.7 % 27.5 % 25.1 % 19.6 %
==================== ==================== ===================== =====================
(1) Includes income tax impacts on restructuring activities primarily relating
to the Separation Transaction as well as charges associated with various
transaction costs and activity associated with Company's restructuring and
integration programs for the three months and years ended September 26, 2025
and September 27, 2024. Includes income tax impacts on real estate impairments
associated with the Company's Focus 2023 Transformation program for the three
months and year ended September 27, 2024.
(2) Includes income tax impacts on amortization of intangible assets as well
as certain subsidiary level compensation based agreements for the three months
and years ended September 26, 2025 and September 27, 2024. The three months
and year ended September 26, 2025 includes income tax impacts on income under
the Company's TSA with Amentum in connection with the Separation Transaction.
The year ended September 26, 2025 includes income tax impacts on discounts and
expenses associated with the Company's non-cash equity for debt exchange
transacted on March 13, 2025.
Reconciliation of Net Earnings Attributable to Jacobs from Continuing Operations to Adjusted Net Earnings
Attributable to Jacobs from Continuing Operations (in thousands):
------------------------------------------------------------------------------------------------------------
Three Months Ended For the Years Ended
-------------------------------------------- --------------------------------------------
September 26, September 27, September 26, September 27,
2025 2024 2025 2024
--------------------- --------------------- --------------------- ---------------------
Net Earnings
Attributable to
Jacobs from
Continuing
Operations $ 138,036 $ 309,299 $ 313,302 $ 612,804
After-tax
effects of
Restructuring,
Transaction and
Other Charges
(1):
Focus 2023
Transformation,
mainly real
estate
rescaling
efforts -- (8) -- 36
Transaction
costs 984 845 21 6,606
Restructuring,
integration,
separation and
other charges 9,823 22,077 43,935 128,155
After-tax
effects of Other
Adjustments
(2):
Transition
Services
Agreement, net (2,911) -- (10,784) --
Amortization of
intangibles 24,696 23,859 97,203 95,020
Mark-to-market
and other
related (gains)
losses on
investment in
Amentum stock -- (186,931) 227,305 (186,931)
Other 38,809 1,339 74,633 9,386
--------------------- --------------------- --------------------- ---------------------
Adjusted Net
Earnings
Attributable to
Jacobs from
Continuing
Operations $ 209,437 $ 170,480 $ 745,615 $ 665,076
===================== ===================== ===================== =====================
(1) Includes after-tax charges primarily relating to the Separation
Transaction and activity associated with Company's restructuring and
integration programs for the three months and years ended September 26, 2025
and September 27, 2024. Includes non-cash real estate impairment charges
associated with the Company's Focus 2023 Transformation program and charges
associated with various transaction costs for the three months and year ended
September 27, 2024.
(2) Includes after-tax and noncontrolling interest charges from the
amortization of intangible assets and certain subsidiary level compensation
based agreements for the three months and years ended September 26, 2025 and
September 27, 2024. The year ended September 26, 2025, as well as three months
and year ended September 27, 2024 also include pretax mark-to-market gains and
losses associated with our investment in Amentum stock in connection with the
Separation Transaction and after-tax income under the Company's TSA with
Amentum in connection with the Separation Transaction for the three months and
year ended September 26, 2025. The year ended September 26, 2025 includes
after-tax discounts and expenses associated with the Company's non-cash equity
for debt exchange transacted on March 13, 2025.
Reconciliation of Diluted Net Earnings from Continuing Operations Per Share to Adjusted Diluted Net Earnings from
Continuing Operations Per Share (in thousands):
-------------------------------------------------------------------------------------------------------------------------------
Three Months Ended For the Years Ended
------------------------------------------------------ ------------------------------------------------------
September 26, September 27, September 26, September 27,
2025 2024 2025 2024
-------------------------- -------------------------- -------------------------- --------------------------
Diluted Net
Earnings from
Continuing
Operations Per
Share $ 1.05 $ 2.38 $ 2.58 $ 4.79
After-tax
effects of
Restructuring,
Transaction and
Other Charges
(1):
Transaction
costs 0.01 0.01 -- 0.05
Restructuring,
integration,
separation and
other charges 0.08 0.18 0.36 1.02
After-tax
effects of
Other
Adjustments
(2):
Transition
Services
Agreement,
net (0.02) -- (0.09) --
Amortization of
intangibles 0.21 0.19 0.80 0.75
Mark-to-market
and other
related
(gains) losses
on investment
in Amentum
stock -- (1.50) 1.86 (1.48)
Other 0.42 0.11 0.60 0.16
-------------------------- -------------------------- -------------------------- --------------------------
Adjusted
Diluted Net
Earnings from
Continuing
Operations Per
Share $ 1.75 $ 1.37 $ 6.12 $ 5.28
========================== ========================== ========================== ==========================
(1) Includes per-share impact charges primarily relating to the Separation
Transaction and activity associated with the Company's restructuring and
integration programs for the three months and years ended September 26, 2025
and September 27, 2024. Includes charges associated with various transaction
costs for the three months and year ended September 26, 2025 and year ended
September 27, 2024.
(2) Includes per-share impacts from the amortization of intangible assets and
certain subsidiary level compensation based agreements for the three months
and years ended September 26, 2025 and September 27, 2024, along with
discounts and expenses associated with the Company's non-cash debt for equity
exchange transacted on March 13, 2025 for the year ended September 26, 2025.
The year ended September 26, 2025, as well as three months and year ended
September 27, 2024 also include per-share impacts from mark-to-market gains
and losses associated with our investment in Amentum stock in connection with
the Separation Transaction and income under the Company's TSA with Amentum in
connection with the Separation Transaction for the three months and year ended
September 26, 2025.
Reconciliation of Earnings Attributable to Noncontrolling Interests from Continuing Operations to
Adjusted Earnings Attributable to Noncontrolling Interests from Continuing Operations (in thousands)
--------------------------------------------------------------------------------------------------------
Three Months Ended Twelve Months Ended
------------------------------------------ ------------------------------------------
September 26, September 27, September 26, September 27,
2025 2024 2025 2024
-------------------- -------------------- -------------------- --------------------
Loss (Earnings)
Attributable to
Noncontrolling
Interests from
Continuing
Operations $ 2,710 $ (9,840) $ (14,620) $ (32,989)
Restructuring,
Transaction and
Other Charges
(1)
Transaction
costs (21) (213) (126) (1,212)
Restructuring,
integration and
separation
charges (357) 278 (432) (1,928)
Other
Adjustments (2)
Amortization of
intangibles (4,756) (4,727) (18,538) (18,573)
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