tapebrief
PWR · Q4 2025

PWR · Q1 2026 Earnings

Bullish

Quanta Services

Reported April 30, 2026

30-second summary

Quanta delivered Q1 2026 revenue of $7.87B (+26.3% YoY) and adjusted EPS of $2.68, with total backlog hitting a record $48.5B (RPO $26.2B), and raised the FY2026 adjusted EPS guide to $13.55–$14.25 (midpoint $13.90, +$0.90 or +6.9%) and revenue to $34.7–$35.2B (midpoint +$1.45B vs. prior). Electric segment margin printed 8.7%, +40bps YoY but ~160bps below the FY 10.3% guide midpoint — a typical Q1 seasonal pattern, FY guide intact but not yet de-risked. Management for the first time anchored execution to a 20-quarter framework committing to double the company's earning power by 2030. Operating cash flow and free cash flow guides were effectively reaffirmed (OCF low end tightened up $50M; FCF range unchanged), the only lines not meaningfully raised.

Headline numbers

EPS

Q1 FY2026

$2.68

Revenue

Q1 FY2026

$7.87B

+26.3% YoY

Gross margin

Q1 FY2026

14.1%

Free cash flow

Q1 FY2026

$0.18B

Operating margin

Q1 FY2026

4.3%

Key financials

Q1 FY2026
MetricQ1 FY2026YoYQ4 FY2025QoQ
Revenue$7.87B+26.3%$7.84B+0.4%
EPS$2.68—$3.16-15.2%
Gross margin14.1%—15.5%-144bps
Operating margin4.3%—6.2%-190bps
Free cash flow$0.18B—$0.95B-80.5%

Guidance

Quanta raised full-year 2026 EPS guidance by 7% and revenue guidance by 4-5% on strong Q1 execution and improved visibility; adjusted EPS now $13.55-14.25 (prior $12.65-13.35), revenue $34.7-35.2B (prior $33.25-33.75B).

Guidance is issued for the full year only, refreshed each quarter. Prior and new below are the same FY updated this quarter.

Changes to prior guidance

MetricPeriodPrior guideNew guideΔResult
Revenue
FY2026
$33.25 billion to $33.75 billion$34.7 billion to $35.2 billion+$1.45 billion to +$1.55 billion at midpoint (+4.3% to +4.6%)Raised
Adjusted Diluted EPS
FY2026
$12.65 to $13.35$13.55 to $14.25+$0.90 to +$0.90 at midpoint (+7.1%)Raised
Net Income attributable to common stock
FY2026
$1.27 billion to $1.38 billion$1.40 billion to $1.50 billion+$0.13 billion to +$0.12 billion at midpoint (+10.2%)Raised
Adjusted EBITDA
FY2026
$3.34 billion to $3.50 billion$3.49 billion to $3.65 billion+$0.15 billion to +$0.15 billion at midpoint (+4.4%)Raised
EBITDA
FY2026
$3.09 billion to $3.25 billion$3.20 billion to $3.36 billion+$0.11 billion to +$0.11 billion at midpoint (+3.6%)Raised
Diluted EPS (GAAP)
FY2026
$8.36 to $9.06$9.17 to $9.87+$0.81 to +$0.81 at midpoint (+9.3%)Raised

Reaffirmed unchanged this quarter: Operating Cash Flow ($2.35 billion to $2.85 billion), Free Cash Flow ($1.55 billion to $2.05 billion)

Segment KPIs

Q1 FY2026
SegmentQ1 FY2026YoY
Electric$6.469B+30.8%
Underground and Infrastructure$1.406B+9.1%

Other KPIs

Q1 FY2026
SegmentQ1 FY2026
Remaining Performance Obligations (RPO)$26.2 billion
Total Backlog$48.5 billion
12-Month RPO$18.0 billion
Adjusted EBITDA$686.4 million
Operating Cash Flow$391.7 million
Electric Segment Operating Margin8.7%
Underground & Infrastructure Operating Margin7.5%

Management tone

The narrative arc through Q1 FY26: management this quarter committed publicly to a 20-quarter framework to double the company's earning power by 2030. The verbatim anchor: "This quarter represents a great start to a 20-quarter stretch during which time we intend to deliver against that expectation, along with continued improvements in our consolidated margins and returns." This is a categorical shift in how management invites investors to underwrite the business — from a quarterly guide-and-deliver model to an explicit multi-year compounding contract. The risk asymmetry is now meaningfully higher: management has staked credibility on a 5-year delivery arc.

The customer-relationship narrative tightened to embedded participant in customer capital planning. Management states: "We are in the rooms where customers are planning their entire multi-year capital spin. We are negotiating much of the work directly...That was not the case five years ago. We are there now." This is the language of switching costs hardening into structural moat — and management explicitly contrasts the current model with the company of five years ago, signaling they view this as a non-reversible repositioning rather than cyclical positioning.

The vertical supply chain commitment evolved to operational doubling milestones. This quarter management said the $500–700M investment will double power transformer manufacturing capacity and nearly double off-site manufacturing, fabrication, and logistics facilities. Quantified capacity targets are harder to walk back than a dollar range, and the Q1 FCF guide reaffirmation (vs. EPS raise) is the visible trade-off.

On margin, management language commits to "continued improvements in our consolidated margins and returns." The FY EBITDA midpoint going up $150M on a $1.45B revenue raise implies the incremental EBITDA margin on the guide raise is ~10.3%, roughly in line with the company average, i.e. consistent with the new "improvements" framing rather than a dilutive scale story.

The one area where confidence remains conspicuously calibrated is CCGT execution. The Goldman exchange surfaced it directly: management is comfortable with single-cycle gas units but explicitly "prudent" on combined cycles, will only enter under "disciplined contract terms", and emphasized de-risking alongside execution. The bullish reframe has not extended to taking on uncompensated execution risk on the most complex generation work.

Recurring themes management leaned on this quarter:

Execution certainty and de-risking customer outcomesVertical supply chain integration and manufacturing capacity expansionStrategic partnership embedding in customer capital planningWorkforce versatility across converging utility and data center marketsRecord backlog supporting 15-20% adjusted EPS growth trajectoryDisciplined capital allocation and investment-grade balance sheet maintenance

Risks management surfaced:

Market conditions variability requiring portfolio diversificationSupply chain and schedule execution complexityCustomer capital program planning cycles and timing uncertaintyLabor availability and workforce scaling challengesIntegration execution risk on manufacturing capacity expansion

Q&A highlights

Nick Amakuchi · Evercore ISA

Asked about underground and infrastructure margin improvement - whether it represents a pull-forward or is contemplated in 2030 guidance. Also inquired about bridge power opportunities and whether the company can capture multiple bites at monetization through off-grid then transmission build-out.

Management confirmed underground/utility infrastructure segment (UUI) is driving margin expansion with ability to operate in double digits. On bridge power, explained most customers ultimately connect to grid; bridge power solutions like Bloom are viable but utilities better positioned to manage microgrids than technology companies due to complexity and intermittency challenges. Vast majority of projects ultimately grid-connected.

Underground segment can operate in double-digit marginsDSI and execution driving UUI margin improvementMost customers ultimately connect to grid at some pointBridge power solutions exist but are backup power for most applications

Steven Fisher · UBS

Requested elaboration on programmatic work opportunities beyond 2030 timeline and degree of formalization of agreements extending that far forward. Asked whether opportunities span transmission, data center, and renewables.

Management confirmed significant work visibility beyond 2030 across transmission, infrastructure, robotics, and grid electrification. Noted grid doubling will take decades (took 7,500 years to build existing grid). Referenced orders for combined cycle engines into 2030 with 3-year build cycles implying work through 2033+. Emphasized elongated cycle and continued demand across generation and electrification verticals for 'decade plus'.

Work visibility extends well beyond 2030Grid doubling will require decades, not 5 yearsCombined cycle engine orders extending to 2030 with 3-year build cycles = work through 2033 minimum'Decade plus' demand outlook across transmission, infrastructure, generation, electrification

Julian DeMoulin-Spith · Jefferies

Followed up on NYSource relationship and Alphabet/Amazon/Google expansions, asking about incremental scope for Quanta and pipeline expansion beyond NYSource in Midwest region. Referenced previously disclosed $5.7B NYSource opportunity.

Management confirmed $5.7B NYSource opportunity continuing to grow daily. Noted CGT and generation awards not yet in backlog pending air permits; expects backlog recognition in H2 and beyond as permits progress. Described relationship as programmatic and expanding, with company positioned on both equipment and services sides. Emphasized strong Midwest demand and continued growth of opportunity.

$5.7B NYSource opportunity 'growing every day'CGT/generation awards pending air permits - expected backlog entry H2 2024+Programmatic relationship with continued expansionCompany involved on both equipment and services sides

Andy Kaplowitz · Citi Group

Asked about composition of backlog additions, specifically whether large load facility awards are consistently over $1B, what percentage of acceleration is customer education on company capabilities, and expectations for large load order ramp.

Management corrected premise that backlog was driven primarily by large load projects. Stated backlog increase was broad-based across all segments and disciplines including transmission (765 represented less than 25% of increase). Characterized as normal course with no single standout project driving beat. Expects backlog to continue rising.

Large load projects = less than 25% of backlog increaseBacklog growth broad-based across all segments and disciplines765 transmission included in backlogNo single project drove the beat - normal course

Ati Modak · Goldman Sachs

Asked whether gas generation (CCGTs) opportunity is core strategic focus to actively grow or more opportunistic benefit from GME solutions. Sought to understand scale of CCGT opportunity for Quanta.

Management indicated comfort with single-cycle gas units but prudent approach to combined cycles given risk. Emphasized daily inbound calls, strong market, but long-cycle nature requires careful contract structuring. Stated company is 'highly focused' and sees it as adjustable market, but will grow scale prudently rather than aggressively. De-risking is priority alongside execution.

Comfortable with single-cycle gas; prudent on combined cyclesDaily inbound CCGT calls indicating strong demandLong-cycle work requiring careful contract structuresDe-risking priority alongside execution excellence

Answers to last quarter's watch list

Q1 Electric segment op margin vs. the 10.3% FY guide midpoint — Q1 printed at 8.7%, below the FY guide midpoint of 10.3%, though +40bps YoY vs. Q1 FY25's 8.3%. Q1 is seasonally the lowest-margin quarter for Electric, so a sub-10.3% Q1 print does not invalidate the FY guide. The FY26 raise to a higher absolute adjusted EBITDA midpoint ($3.57B vs. prior $3.42B) implies the Electric FY margin guide has effectively been raised. Management's verbal commitment to "continued improvements in our consolidated margins" supports the read that the 10.3% bar will be cleared, but the Q1 print itself does not yet de-risk it. Status: Continue monitoring
Generation backlog bookings — Per the Jefferies Q&A, CCGT/generation awards for the $5.7B NiSource opportunity are not yet in backlog pending air permits, with expected H2 2026 conversion. The Citi Q&A confirmed the $4.5B QoQ backlog beat was not generation-driven (765kV transmission less than 25%). The generation booking thesis has not advanced this quarter; visibility into H2 2026 is the next data point. Status: Continue monitoring
Vertical supply chain capex pace — Management confirmed the $500–700M commitment and added quantified milestones: doubling transformer manufacturing capacity and nearly doubling off-site fabrication. Q1 capex figures were not surfaced in the inputs to enable a pace read, but the FCF guide was reaffirmed unchanged at $1.55–$2.05B — implying capex assumptions in the prior guide were correct and not being adjusted, which is consistent with on-pace, not front-loading or back-loading. Status: Continue monitoring
Organic vs. acquisition contribution split — FY26 adjusted EPS guide raised $0.90 to $13.90 midpoint. Acquisitions were previously framed at $0.40–$0.50 contribution. The guide raise outpaces what a marginal acquisition contribution could reasonably add, so the bulk of the $0.90 raise is organic — directly addressing the watch. Management explicitly highlighted "revenue growth and margin performance exceeded our expectations across both segments." Status: Resolved positively
RPO-to-total-backlog ratio — Total backlog $48.5B, RPO $26.2B; the gap widened to $22.3B from Q4's $20.22B. LNTPs are growing faster than firm contract conversion. Management framed the gap constructively (air-permit-pending generation work expected to firm in H2), but the ratio trend is unambiguously toward more uncontracted committed pipeline, not less. Status: Resolved negatively
Renewable safe-harbor cliff visibility — No specific renewable safe-harbor commentary surfaced in the inputs this quarter. The Q1 disclosure did not address the 2027 ITC cliff or 2028–2029 safe-harbor pull-forward dynamics flagged in prior quarters. Management's 20-quarter doubling framework implicitly assumes renewables continue to contribute, but the cliff was not addressed. Status: Continue monitoring

What to watch into next quarter

Q2 Electric segment op margin recovering toward the FY guide midpoint: Q1 printed 8.7% vs. the 10.3% FY guide midpoint. Watch Q2 Electric segment margin for a step-up toward 10%+ — anything still below 10% by Q2 would put real pressure on the Q3/Q4 bar to clear the FY guide.

First material generation backlog booking from the NiSource $5.7B pipeline: management said H2 2026 for CCGT/generation conversion pending air permits. Watch whether Q2 marks the first material booking — anything visible by Q2 de-risks the H2 narrative; nothing visible pushes the entire generation revenue ramp narrative further right.

RPO-to-total-backlog gap: the gap is now $22.3B and widening. Watch whether Q2 RPO conversion catches up (firm contract velocity winning) or the gap widens beyond $23B (LNTP accumulation outrunning conversion further).

Underground segment margin reversion: Q1 printed 7.5% with management claiming "double-digit" forward potential. Watch whether Q2 prints above 8% — the "double digit" claim needs evidence within 1-2 quarters to retain credibility.

Free cash flow conversion pace: Q1 FCF of $184M against an unchanged $1.55–$2.05B FY range. To hit the midpoint of $1.80B, Q2–Q4 needs ~$1.62B — roughly the same back-loaded pattern as 2025 but on a larger base. Watch Q2 FCF for the pace check; sub-$300M in Q2 would put the FY range at risk.

20-quarter doubling framework: any interim milestone disclosure: management committed to doubling earning power by 2030 across 20 quarters. Watch whether subsequent prints introduce interim milestones (e.g. 2028 EPS framework, or a 2027 revenue floor) that turn the qualitative commitment into a falsifiable trajectory.

Sources

  1. Quanta Services Q1 2026 press release (Exhibit 99.1), SEC filing dated April 30, 2026 — https://www.sec.gov/Archives/edgar/data/1050915/000119312526193918/d107542dex991.htm
  2. Tapebrief Q4 2025 PWR brief (prior-quarter guidance baseline, watch list)
  3. Tapebrief Q3 2025 PWR brief (margin trajectory and tone arc context)
  4. Tapebrief Q2 2025 PWR brief (multi-quarter narrative arc)

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