AECOM Reports Record Q2 Performance, Raises FY26 EPS & EBITDA Guidance, Driven by Record Backlog

summarizeSummary

AECOM announced strong second-quarter fiscal 2026 results, including record performance and an 8% increase in total backlog to a new high, leading to a second consecutive raise in its full-year adjusted EPS and EBITDA guidance.

check_boxKey Events

• Record Q2 Performance

  Achieved record second-quarter performance with GAAP net income up 19% to $184 million and diluted EPS up 22% to $1.42. Adjusted EPS increased 27% to $1.59.

• Raised FY26 Guidance

  Increased fiscal 2026 adjusted EPS guidance to $5.90-$6.10 (from $5.85-$6.05) and adjusted EBITDA guidance to $1,275M-$1,305M (from $1,270M-$1,305M).

• Record Backlog Growth

  Total backlog grew 8% to a record $26.2 billion, supported by a 1.2 design book-to-burn ratio, marking the 22nd consecutive quarter above 1.

• Reiterated Cash Flow Target

  Despite negative free cash flow in Q2 due to timing, the company reiterated its full-year free cash flow guidance of approximately $400 million, with Middle East collections already recovering.

auto_awesomeAnalysis

AECOM's strong second-quarter results, highlighted by record performance and substantial backlog growth, indicate robust operational execution and future revenue visibility. The decision to raise full-year adjusted EPS and EBITDA guidance for the second consecutive quarter underscores management's confidence in sustained growth, especially as the stock trades near its 52-week low. While Q2 free cash flow was negative, the company's explanation of timing issues and reiteration of its full-year cash flow target should alleviate investor concerns, suggesting a temporary rather than structural issue. This report provides a positive outlook for the company's financial trajectory.