Dycom Industries, Inc. ( DY ) shares tumbled after the company posted record second-quarter results for the period ended July 26, 2025. Contract revenues were up 14.5% to $1.38 billion from $1.20 billion a year earlier, falling short of analyst estimates of $1.41 billion.

Organic revenue grew 3.4%, while contributions from acquired businesses rose to $139.8 million from $5.7 million in the prior-year quarter.

Net income increased 42.5% to $97.5 million, or $3.33 per diluted share, compared with $68.4 million, or $2.32 per diluted share, last year. Adjusted EPS of $3.33 beat analyst estimates of $2.90.

The company’s Non-GAAP Adjusted Net Income was $72.5 million, or $2.46 per diluted share, in the year-ago period. Adjusted EBITDA rose 29.8% to $205.5 million, or 14.9% of contract revenues, up from $158.3 million, or 13.2%, a year earlier.

Operating cash flow for the quarter was $57.4 million. The company ended the quarter with a backlog of $8.0 billion, cash and equivalents of $28.5 million, and long-term debt of $1.01 billion, with an additional $20 million due within one year.

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For the first half of fiscal 2026, contract revenues increased 12.4% to $2.64 billion, compared with $2.35 billion in the prior-year period. Organic contract revenues grew 2.1%.

Adjusted EBITDA rose to $355.9 million, or 13.5% of revenues, up from $289.2 million, or 12.3%, a year earlier. Last year, the non-GAAP Adjusted Net Income was $135.0 million, or $4.58 per diluted share.

The company repurchased 200,000 shares for $30.2 million during the six-month period.

“Dycom’s first-half performance confirms the strength of our strategy, disciplined execution and ability to capitalize on a rapidly expanding market,” said CEO Dan Peyovich. “This quarter, we delivered record revenue within our range of expectations and record earnings that exceeded our expectations. We meaningfully improved margins through operational efficiency and operating leverage, and strengthened our financial position through measured cash flow management.”

Outlook:

For fiscal 2026, Dycom reaffirmed its sales outlook of $5.29 billion to $5.43 billion, compared with analyst expectations of $5.38 billion.

For the third quarter, the company projects revenue of $1.38 billion to $1.43 billion, below the $1.46 billion analyst estimate, and diluted EPS of $3.03 to $3.36, compared with the consensus of $3.10.

Adjusted EBITDA is expected to range from $198 million to $213 million.

The company noted risks to its outlook, including inflationary pressures, changes in tariff policies, customer capital budget adjustments, weather-related disruptions, and potential regulatory or litigation impacts.

Price Action: As of the last check on Wednesday, DY shares were trading 10.92% lower at $140.12 premarket.

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