Quanta Services Q4 2024 Earnings Report

Quanta Services EPS Results

• Actual EPS: $2.74
• Consensus EPS: $2.62
• Beat/Miss: Beat by +$0.12
• One Year Ago EPS: N/A

Quanta Services Revenue Results

• Actual Revenue: $6.55 billion
• Expected Revenue: $6.61 billion
• Beat/Miss: Missed by -$53.61 million
• YoY Revenue Growth: N/A

Quanta Services Announcement Details

• Quarter: Q4 2024
• Date: 2/20/2025
• Time: Before Market Opens
• Conference Call Date: Thursday, February 20, 2025
• Conference Call Time: 9:00AM ET

Quanta Services (NYSE:PWR) provides infrastructure solutions for the electric and gas utility, renewable energy, communications, and pipeline and energy industries in the United States, Canada, Australia, and internationally. The company's Electric Power Infrastructure Solutions segment engages in the design, procurement, construction, upgrade, repair, and maintenance of electric power transmission and distribution infrastructure and substation facilities; installation, maintenance, and upgrade of electric power infrastructure projects; installation of smart grid technologies on electric power networks; and design, installation, maintenance, and repair of commercial and industrial wirings. This segment also offers aviation services; emergency restoration services; and other engineering and technical services; design and construction solutions to wireline and wireless communications, cable multi-system operators, and other customers; and training for electric workers, as well as training for the gas distribution and communications industries. The company's Renewable Energy Infrastructure Solutions segment is involved in engineering, procurement, construction, repair, and maintenance of wind, solar, and hydropower generation facilities, as well as battery storage facilities; and provision of engineering and construction services for substations and switchyards, transmission, and other electrical infrastructures. The company's Underground Utility and Infrastructure Solutions segment offers design, engineering, procurement, construction, upgrade, repair, and maintenance services for natural gas systems for gas utility customers; fabrication services for pipeline support systems and structures and facilities; and engineering and construction services for pipeline and storage systems, and compressor and pump stations. The company was formerly known as Fabal Construction, Inc. and changed its name to Quanta Services, Inc. in November 1997. The company was incorporated in 1997 and is headquartered in Houston, Texas.

Quanta Services Q4 2024 Earnings Call Transcript

Presentation

[Operator]

Good morning, and welcome to the Quanta Services Fourth Quarter and Full Year twenty twenty four Earnings Call. At this time, all participants are in a listen only mode. A question and answer session will follow management's prepared remarks, and we ask that you please hold all questions until that time. I will then provide instructions for the question and answer session. As a reminder, this conference is being recorded.

[Operator]

If you have any objections, please disconnect at this time. I will now turn the call over to Kip Rupp, Vice President of Investor Relations for introductory remarks.

[Kip Rupp, VP of IR at Quanta Services]

Thank you, and welcome everyone to the Quanta Services fourth quarter and full year twenty twenty four earnings conference call. This morning, we issued a press release announcing our fourth quarter and full year twenty twenty four results, which can be found in the Investor Relations section of our website at quantaservices.com. This morning, we also posted our fourth quarter and full year twenty twenty four operational and financial commentary and our 2025 outlook expectations summary on Quanta's Investor Relations website. While management will make brief introductory remarks during this morning's call, the operational and financial commentary is intended to largely replace management's prepared remarks, allowing additional time for questions from the institutional investment community. Please remember that information reported on this call speaks only as of today, 02/20/2025, and therefore, you are advised that any time sensitive information may no longer be accurate as of any replay of this call.

[Kip Rupp, VP of IR at Quanta Services]

This call will include forward looking statements and information intended to qualify under the Safe Harbor from Liability established by the Private Securities Litigation Reform Act of 1995, including statements reflecting expectations, intentions, assumptions or beliefs about future events or financial performance that do not solely relate to historical and current facts. You should not place undue reliance on these statements as they involve certain risks, uncertainties and assumptions that are difficult to predict or beyond Quanta's control and natural results may differ materially from those expressed or implied. We will also present certain historical and forecasted non GAAP financial measures. Reconciliations of these financial measures to the most directly comparable GAAP financial measures are included in our earnings release and operational and financial commentary. Please refer to these documents for additional information regarding our forward looking statements and non GAAP financial measures.

[Kip Rupp, VP of IR at Quanta Services]

Lastly, please sign up for e mail alerts through the Investor Relations section of quantaservices.com to receive notifications of news releases and other information and follow Quanta IR and Quanta Services on the social media channels listed on our website. With that, I would like to now turn the call over to Mr. Duke Austin, Quanta's President and CEO. Duke?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Thanks, Kit.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

This morning, we reported our

[Duke Austin, President & Chief Executive Officer at Quanta Services]

fourth quarter and full year twenty twenty four results, which included double digit growth in revenues and earnings and a number of record financial metrics. Total backlog at year end was $34,500,000,000 and notably, Renewable Energy Infrastructure Solutions segment twelve month and total backlog achieved all time highs. Our ability to deliver consistent profitable growth is a testament to the strength of our portfolio approach. A diversified solutions based strategy that enables us to adapt to evolving industry dynamics while delivering mission critical infrastructure. Quanta has produced record revenues seven of the last eight years, seven consecutive years of record adjusted EBITDA and eight consecutive years of record adjusted diluted earnings per share.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

These results were made possible by more than 58,000 dedicated employees and our industry leading operational and financial platform. 2024 was another successful year for Quanta strategically, operationally, and financially. And while there are always areas for improvement, we are proud of our many accomplishments during this year, and we continue to look forward with excitement towards the multiyear strategic initiatives we are working on and the goals we expect to achieve in this and the coming years. We continue to see significant opportunity to advance our growth strategy and are pacing well against our multi year financial targets, including double digit EPS growth and double digit returns. Our strategic initiatives are enhancing our service lines and capabilities, while also expanding our customer base and therefore, enlarging our total addressable market opportunity for both organic growth and strategic capital deployment.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

The energy and infrastructure landscape is undergoing a fundamental transformation, and Quanta is positioned at its center. Utilities across The United States are experiencing and forecasting meaningful increases in power demand for the first time in two decades, which is being driven by the adoption of new technologies and related infrastructure, including data centers and artificial intelligence, the energy transition and policies intended to strategically reinforce domestic manufacturing and supply chain resources. This increasing demand, coupled with tightening power generation capacity, underscores the urgent need for large scale grid modernization and energy infrastructure development. Fauna's portfolio approach uniquely positions us to support our clients as they navigate this evolving landscape. Our diversified service lines, self performed capabilities, and craft skilled workforce give us the flexibility to deploy resources where they create the most value across geographies, industries, and service lines.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We believe our collaborative, solution based approach is valued by our clients more than ever. We are positioning Quanta for decades of expected necessary infrastructure investment and believe our service line diversity creates platforms for growth that expand our total addressable market. Our portfolio approach and focus on craft skilled labor is a strategic advantage that provides us the ability to manage risk and shift resources across service lines and geographies, which we believe will become increasingly important as load growth, electrification and the energy transition accelerates. We believe our portfolio approach positions us well to allocate resources to opportunities we find the most economically attractive and to achieve operating efficiencies and consistent financial results. I will now turn the call over to Jayshree Desai, Quanta's CFO, to provide a few remarks about our results and 2025 guidance and then we will take your questions.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Jayshree?

[Jayshree Desai, Chief Financial Officer at Quanta Services]

Thanks, Duke, and good morning, everyone. Quanta completed the year with fourth quarter revenues of $6,600,000,000 net income attributable to common stock of $305,100,000 or $2.03 per diluted share and adjusted diluted earnings per share of $2.94 Adjusted EBITDA was CAD 737,800,000.0 or 11.3% of revenues. Of note, our cash flow in the fourth quarter and for the full year exceeded the upper end of our free cash flow guidance expectations. For the fourth quarter and full year of 2024, we had free cash flow of $575,400,000 and $1,600,000,000 respectively, with our full year free cash flow a record. Our earnings and cash flow performance allowed us to end the fourth quarter with ample liquidity and a balance sheet that supports both our organic growth expectations and the opportunistic investment of capital to generate incremental returns for our stockholders.

[Jayshree Desai, Chief Financial Officer at Quanta Services]

To that end, subsequent to the end of twenty twenty four, we acquired two companies for aggregate upfront consideration of approximately $562,000,000 of cash and stock. This morning, we provided our full year 2025 financial expectations, which calls for another year of profitable growth with record revenues, improved margins and opportunity for double digit growth in adjusted EBITDA and adjusted earnings per share. We believe our expectations demonstrate the strength of our portfolio approach to the business, our commitment to our long term strategy, our favorable end market trends and our competitive position in the marketplace. As mentioned in our earnings release, beginning with three months ending 03/31/2025, we will report our results under two reportable segments: Electric Infrastructure Solutions and Underground Utility and Infrastructure Solutions. The new Electric Infrastructure Solutions segment combines the previous Electric Power Infrastructure Solutions and Renewable Energy Infrastructure Solutions segments.

[Jayshree Desai, Chief Financial Officer at Quanta Services]

This new segment reporting reflects how the business is managed and resources are allocated and better reflects the positioning of our strategies and comprehensive solutions for our growing and increasingly converging addressable markets. Additional details and commentary about our 2025 financial guidance can be found in our operational and financial commentary and outlook's expectation summary, both of which are posted on our IR website. In summary, we are executing well on our strategic plan and are pacing well against our multi year financial targets, including double digit EPS growth and double digit returns. We ended 2024 with record backlog and our end markets have never been better and we see opportunity for further strength in the coming years. With that, we are happy to answer your questions.

[Jayshree Desai, Chief Financial Officer at Quanta Services]

Operator?

[Operator]

Thank you. We will now move to our question and answer session. We ask that all participants limit themselves to one question. If you have additional questions, you may requeue and ask and those questions will be addressed time permitting. If you have joined via the webinar please use the raise hand icon which can be found in the bottom of your webinar application If you have joined by phone please dial 9 to raise your hand When you are called on please unmute your line and ask your question Our first question comes from Chad Dillard with Bernstein.

[Operator]

Your line is open. Please go ahead.

[Chad Dillard, Analyst at Bernstein]

Hey, good morning guys.

[Kip Rupp, VP of IR at Quanta Services]

Good morning.

[Jayshree Desai, Chief Financial Officer at Quanta Services]

Good

[Jayshree Desai, Chief Financial Officer at Quanta Services]

morning.

[Chad Dillard, Analyst at Bernstein]

So just a big picture question here. So what does the shift from investing in training data centers to inference mean for Quanta and the broader grid? Is there any difference in labor needs, design approach, grid use? Is it a positive, negative or net neutral?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

I mean, when we look at data centers and what it does, like, before AI, there was still significant demand. After AI, there's more demand. How much demand? I I don't know. What what I do see is we see firm commitments of generation at our customer level.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

You can look at it. You can point to it. It's well over 50 gigs in the hundred gigs, honestly. So when you see those that type of demand on energy, the the type of data centers and how you're looking at it, we're we're not looking at it in that way. We're just seeing the demand on our infrastructure and what we need to build.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We're booking backlog against it. So we, you know, we just see a great market there, And and the the from DeepSeq to, you know, AI chips and and what that does, we're not concerned with that at this point. We just seek, you know, that that demand is firm.

[Chad Dillard, Analyst at Bernstein]

That's helpful. And just second question just on the recent M and A that you guys did. So I guess, first of all, like what sort of revenue contribution should we be baking in for '25? And then on the civil business, how are you thinking about the mix of business going forward? Is this meant to support Quanta's core business or are there going to be other like ancillary verticals that you're going to be operating in?

[Chad Dillard, Analyst at Bernstein]

And then on the the Australia expansion, I guess, like, what's your your long term view on on Australia as, you know, an attractive market? And, I guess, what is the market structure and and how is a Quanta position there with this acquisition?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yeah. So the basically, the civil acquisition business, I think from my standpoint, the DNA, the culture of the company, we've known them a long time, known them for decades. I passed by their office my whole career. So I know the family. It's a great family business.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

It fits our DNA, and it also is something that the company itself has synergies against that you know, obviously, we don't put those in the deal. I feel like when we look at those solutions that we can provide, it gives us a holistic approach. Our customers are asking for it. We can deliver it on a holistic basis and really add value to the overall solutions of what we're trying to accomplish. If you look at a thousand acre solar site, look at a thousand acre 10,000 acre data center, you look at all the things that we do and try to provide solutions to whether it's LNG, sites, it doesn't matter.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We we will take the assets, the people, which are the core to it, and go and deliver against our own business as well as others. So it's a solution that people are asking for, and we wanna be holistic when we look at it and self perform more capabilities and give ourselves more flexibility as we look at the markets. In Australia, we continue to invest in Australia. The front side of the business down there is something that we've said all along that we'll continue to invest in. Great companies, great markets.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We're market leaders in the renewable business down in Australia. We like to we like it long term and and feel like we can continue to invest, in the country. So great rule of law and obviously gives us a lot of flexibility. So we're excited about that market as well. I'll let Jayshree comment on the revenues.

[Jayshree Desai, Chief Financial Officer at Quanta Services]

We don't contribute. We're not going to discuss any individual acquisition, but we'll tell you that the two acquisitions, majority of it is captured in our UU and I segment and we did give you guidance in that around what the inorganic contribution in our guide is related to that.

[Chad Dillard, Analyst at Bernstein]

Thank you.

[Operator]

Our next question will come from Ati Modak with Goldman Sachs. Please unmute and ask your question.

[Atidrip Modak, Vice President - Energy Services & E&Ps at Goldman Sachs]

Yeah. Hi. Good morning, team. Maybe I was wondering if you can provide some color on the margin performance in the electric power segment, the factors that drove that, and how much of the margin improvement should we consider as structural going forward?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yeah. I mean, we executed well in the quarter. We've done some acquisitions there with Cupertino that are in the segment. Obviously, it had a lower margin profile, but a better return. So I do think when we look at it, the margins that we've stated in the past, 10 and a half, 11% type framework, 12 on the outer years that where if you got a lot of utilizations and and things of that nature in the business.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

But in general, we settled along. It was back half loaded. We felt like the the electric business is gonna be strong in the second half. It was, you know, I I can only say that we have the field and the personnel that we have out there and the structures that we put together is what's delivering it. And I think as we see the markets, we will continue to deliver earnings in the the 10.5, 11 range in this segment.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

That's, you know, basically where we're at and where we'll be, on a go forward basis. So I think no matter what we do in that segment, that's kind of how you should look at the framework going forward. Yeah. There'll be some years that are above it, due to some factors here or there. But given what we see in the market, that's kind of the framework we see going forward, 10.5% to 11%.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Carter, do you want to

[Jayshree Desai, Chief Financial Officer at Quanta Services]

add I think also just to add to it, if you look at our electric segment, you're seeing us at over 10%, and that's after taking into consideration that we have reduced storm from where we were, in 2024. It takes out the Peru impact. And even with that, we're still in double digit segment revenue. And I think that you should take comfort that we're going to continue operating at that level. And the performance of the company from last year is going to go into 2025 as well.

[Atidrip Modak, Vice President - Energy Services & E&Ps at Goldman Sachs]

Makes sense. Thank you, Jayshree.

[Operator]

Our next question will come from the line of Jamie Cook with Truist Securities.

[Jamie Cook, Managing Director - Equity Research at Truist Securities]

Hi, can you hear me? Hey, can you hear me now?

[Jayshree Desai, Chief Financial Officer at Quanta Services]

Hey, Jamie.

[Jamie Cook, Managing Director - Equity Research at Truist Securities]

Oh, hey, thanks guys. I guess my first question, Duke, if you could frame the expectations for backlog growth in 2025 and in particular, can you talk to potential synergies or big awards that could be coming out of Cupertino? I know you guys were very successful with revenue synergies associated with Blattner. I'm just trying to understand what's going on with Cupertino and is that an opportunity for larger awards in 2025? But my second question, Jayshree, just and I'm sorry if you missed this.

[Jamie Cook, Managing Director - Equity Research at Truist Securities]

I know on the cash flow guide, you sort of talked to it being more back end loaded. Just how do we think about first half versus back half and what's driving that? Thank you.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Thanks, Jamie. I think when we look at the business in totality, when we buy these platform companies, we don't build synergies into, you know, the discussions that we have or the way we value them. But what we what we do see is when the total adjustable markets, the TAMs on the business are something that goes unnoticed, the customer base goes unnoticed, those synergies show up. And you've seen them with Blattner as we've gotten farther along in the in the balance of plant, the things that we're able to do with these type customers because there's convergence between, technology, utilities and the way we look at the data centers. And so the way that we're looking at the business certainly looks different and those markets are different.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

If you just look at the tech CapEx and you look at utility CapEx, utility CapEx is $200,000,000,000 plus and then now technology is $300,000,000,000 plus but probably let's just call it $150,000,000,000 in North America. The addressable markets that Quanta serves and how we converge in the nexus of the middle of it really puts us in a different position on larger projects. So I expect our backlog to be at record levels. It could CAGR at record levels. It wouldn't surprise me.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

But I I do expect us to be at record levels throughout the year. I can't tell you exactly you know how the backlog looks, so I can't tell you exactly when that'll happen. But what I see, bigger projects, the our ability to perform solutions is something that's unnoticed to to the investment community. We are a solutions provider. I'll say it again, solutions provider.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

And what we do and those solutions that we provide and how we collaborate with that customer will allow us to and our addressable markets only are getting bigger. So it just allows us more opportunity, and I think we see it. We see it showing up. Super excited about where we sit and and the strategies that we have going forward against that solution based, you know, how we use craft skill and engineering in that solution. So, yeah, I mean, I I fully expect us to book larger projects and but we'll continue the base business.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We are not taking our eye off that either. So, Shree.

[Jayshree Desai, Chief Financial Officer at Quanta Services]

But Jamie, yes, on a free cash flow oh, sorry, go ahead.

[Jamie Cook, Managing Director - Equity Research at Truist Securities]

No, I was just going to say specific to Cupertino was the question too, Duke. Like anything specific to Cupertino in terms of a revenue center, larger awards in 2025?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

I think I inferred that, but yes, absolutely.

[Jamie Cook, Managing Director - Equity Research at Truist Securities]

Okay. Okay. All right. Sorry, Jayshree. Go on the cash flow question.

[Jamie Cook, Managing Director - Equity Research at Truist Securities]

Thanks.

[Jayshree Desai, Chief Financial Officer at Quanta Services]

Yes. On free cash flow, it's our typical profile, Jamie. It'll be back half weighted. Wouldn't expect too much in the first half just given the nature of how our business operates. So I think you'll see similar, cadence to what we've done the last couple of years.

[Jamie Cook, Managing Director - Equity Research at Truist Securities]

Okay. Thank you.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Thanks, Jim.

[Operator]

Our next question will come from Steven Fisher with UBS. Please unmute and ask your question.

[Steven Fisher, Managing Director & Equity Research Analyst at UBS Group]

Thanks. Good morning. It was helpful to have the guidance for upper single digit growth in generation versus the mid singles and in high and low voltage. Just curious directionally, if you can give us a sense of what those growth rates were in 2024, so we can kind of see how it compares year over year? And then just kind of looking beyond '25 conceptually, do you think generation should still grow kind of above the high and low voltage rate for the next couple of years?

[Steven Fisher, Managing Director & Equity Research Analyst at UBS Group]

Or is this sort of like the renewables piece kind of driving generation, which is going to slow down while the grid part should be accelerating and those streams will cross, if you will?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yes, Steve. I mean, I think you're seeing growth across the business. You're seeing growth at the EPS line at the midpoint. What is it? 16% at the midpoint of EPS.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

And you're seeing growth on the top line, call it organic growth, six to seven, 10% if you look at the whole company on the top. So we're seeing growth. We're one of the reasons that we're going to one segment is how we run the business. And we feel like that the convergence of the business we we spoke a lot last year around t and d. Actually, I explained it for four months that our transmission and distribution cruise cross segments.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

It was very confusing to the investment community. It's it's not how we run the business, so we put it together. So for us to go in and tell you how much generation growth or, you know, what is that because there's substations. There's all kinds of different things. Our our people cross, from data centers to chip plants to, hospitals, clean rooms.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We move all across. So we're gonna optimize our people against the markets. We're not making any specific manufacturing, you know, anything manufacturing where it's only specific to one segment or one TAM. I mean, we we're we're addressing across a large customer base. So we like the way we're set up, and we're we're not gonna get into guidance on little pieces of the segment because it doesn't matter to us.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

What matters is the markets are growing. All the business is growing. We're putting up at at the midpoint of the range 10 plus. You see growth all across it. So we we feel like that all the markets that we're in are growing and we can move and be nimble across them and provide those solutions that we've discussed on the go forward basis, how we're gonna run the business, how we're gonna talk about the business.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

And we have growth and we see growth. You can see the backlog. I welcome you to look at the backlog and and see that what we put up in the renewable segment alone, which I believe we said that last quarter that we would put it up and we did. And I those kind of numbers are staying there and they're not just twelve month backlog. It's long term backlog in the '26, '20 '7, and '28.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

So we see growth and I think you can comfort yourself on the demand you see for generation. I it's just a supply and demand issue. We've said this. Like, the demand on generation, it doesn't matter. It it's gonna be renewables.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

It's gonna be gas fired generation. It's gonna continue, and you can see it. It it's right there, and then we're talking about it daily. So I we're optimistic. We like the growth.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We're not gonna get into the little pieces of the segment. That's not who we are. We're a solution provider.

[Steven Fisher, Managing Director & Equity Research Analyst at UBS Group]

Sounds good. Thank you.

[Operator]

Our next question will come from the line of Julien Dumoulin Smith with Jefferies. It appears you're on the phone Julien, star six will allow you to unmute.

[Julien Dumoulin-Smith, Research Analyst at Jefferies Financial Group]

Excellent. Good morning, everyone. Thanks very much for the time. I appreciate it. Maybe just to come back to that last point here briefly, just on the renewable front real quickly.

[Julien Dumoulin-Smith, Research Analyst at Jefferies Financial Group]

As you think about some of the headlines here under the new administration, can you speak a little bit to your confidence in the execution on the Sunseil project specifically, both in terms of operations and permitted considerations on across federal lands? I suspect it's largely intact, but just want to make sure we've checked that off. And then separately and related here, as you think about this resegmentation, I think you were alluding to it a moment ago, but if you were to re segment, right, again, just to use the hypothetical in brief, can you speak as to how that backlog would translate into compounding revenue as it stands today? I suspect some folks are looking at this and saying, well, is there something about a deceleration in the renewables business? Clearly, the backlog data points today would suggest otherwise.

[Julien Dumoulin-Smith, Research Analyst at Jefferies Financial Group]

But if you can speak to that even more clearly than you just alluded to a moment ago, I'd appreciate it.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yeah, Dylan. Thanks. Sunzia, first of all, like, I we're doing great. We're we're progressing well. I I, you know, fully expect us to complete.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We're not seeing any permitting issues on it. You know, we're well past that. And then I I I wanna talk a little bit about Sunsea because I think people worry about the replacement. If you break Sunsea down and you go soon half year project, if you look at the wind piece, it's basically two jobs, a year. And I I just we're not worried about replacing Sunsea.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We've already replaced it. It's in the backlog. And then on the transmission line, yes, it's it's a big line, but we've replaced that as well. And so I'm not concerned at all with our ability to replace some going forward, and I I think that's a misnomer in in investment community. I wanna get that out there and say, we're not worried.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Second, when we're talking about generation, we're seeing renewable generation growth. We're seeing it in outer years. We're looking at '26, '20 '7, and '28. We put growth up in '25. We'll put growth up in '26.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We're not concerned at that at this point with that. And, yes, there's going to be gas generation getting built. We see it. We've said it all along. It's 30%.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

But when you start ordering turbines that are thirty six to forty eight months out, what are you going to do between now and then? And I I still believe, like, even when you get turbines in, when you start to see that, it you still got to build renewables behind it and fill up the lines. And it it when I look at the cost of renewables at the way I'm looking at it and the way everyone should, we gotta fill the lines up with renewables, gas, batteries, everything possible because that's what matters and people are underestimating transmission. The real issue is we need to build transmission in North America to really fully get the capabilities of all forms of energy. So I'm not worried about growth, but we need to get the permitting straight to get the transmission built.

[Jayshree Desai, Chief Financial Officer at Quanta Services]

And Julian, just to clear, we are resegmenting, starting first quarter.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yes. Yes. We're resegmenting first quarter for

[Duke Austin, President & Chief Executive Officer at Quanta Services]

sure.

[Julien Dumoulin-Smith, Research Analyst at Jefferies Financial Group]

Yes. No, absolutely indeed. And if I can pick up on that last point quickly because these RTOs have really released quite substantive increases in their transmission, planning processes in the last quarter. So What's the timeline and cadence that you're expecting for some of that to flow into your backlog?

[Julien Dumoulin-Smith, Research Analyst at Jefferies Financial Group]

I get that there is some kind of lag here. It could be a couple of quarters or so. How do you think about that across these because the numbers are really quite staggering in the last few months?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yes. I'm glad you noticed. What I would say is I do think we're having those discussions today and before they even came out. I think Steve was talking about the larger projects. Someone should look at those queues and see what those say, and that's on top of their already ongoing capital.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Those are big projects that are both in, on mainly all the RTOs for that matter. So you're starting to see bigger work, and we're having those discussions, on a daily basis and I like our chances.

[Julien Dumoulin-Smith, Research Analyst at Jefferies Financial Group]

All right. Best of luck.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Thank you.

[Operator]

Our next question will come from the line of Steve Fleishman with Wolfe Research. Again, Steve, that's star six to unmute. We can hear you. Please go ahead.

[Steve Fleishman, Managing Director and Senior Analyst at Wolfe Research LLC]

Okay. Sorry about that.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Hi, Steve.

[Steve Fleishman, Managing Director and Senior Analyst at Wolfe Research LLC]

Hi. So I think on the I think you answered the question on renewables that it sounds like the tailwinds are still there that you're seeing despite the change in administration and some of the tariffs, other things that have come up just means I would just ask is there anything that you're watching or wary of there, but certainly didn't look like it with the backlog increase you got.

[Steve Fleishman, Managing Director and Senior Analyst at Wolfe Research LLC]

Second question is, you mentioned a lot of focus on gas and that seems to keep increasing. I know you don't want to be in the gas turbine business, but just do you see kind of the pieces of your coming together for more growth in your undergrounding business over the next several years as this does seem to be likely to ramp up meaningfully looking out?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yes, Steve. First of all, like you know, we we do look at I mean, we're looking at administration on PTCs and, and how that would impact our customers. I think we we we watch that closely. There's a lot of safe harboring. We feel good about our our top, you know, 10 clients, and they're very sophisticated.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

And I I I'm not as concerned, but we do watch it. I I I think, you know, we have a really good ten years worth of, you know, look out in in renewables and and what we see. I mean, certainly, some of that is based on the RA and and the way it impacts it. But the guy the administration, yes, it it it will be noisy. But I think in the end, the generation that's needed and what we need will prevail against those kind of, you know, short term dynamics in the market, what you may hear.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We are booking backlog. We see work out long long out, and, you know, we need all forms of generation. I think it goes back probably ten years. And and when we talked about it, we talked about all forms of energy, all forms of generation. It's never been as as pronounced as it is today.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We need all forms, and we need it quickly and as fast as we can build it. And I I think the demand is there. That's why we're seeing behind the meter things come up, distribute generation, everything that you're seeing because we can't meet it fast enough. When I look at see, when we look at combined cycle, it's just not who we are. We we can build it.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We probably will build it, but we're not gonna build it at risk. And so, yes, we'll help our customers. We'll we can build substation around. We can do all kinds of things around it. But, you know, the cost of a combined cycle is is not cheap either.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

And so I I think trying to get gas to it and and the cost on on turbines and how much it costs to build one these days is not the same. And so I think in general, we have to make sure that we cover the company off on that risk. It it's certainly been something in the past that I can't get out of my head, and, we'll be prudent about how we look at that business. I I do think it's opportunities and opportunities all the way around it. Single cycles, small stuff, yes, we can build them.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

I mean, those aren't difficult and we'll be involved in some of that, but we won't take the risk on combined cycle.

[Steve Fleishman, Managing Director and Senior Analyst at Wolfe Research LLC]

Okay. Thank you.

[Operator]

Your next question will come from the line of Justin Hauck with Robert W. Baird. Please go ahead.

[Justin Hauke, Vice President and Senior Research Associate at Robert W. Baird & Co]

Great. Thanks. Good morning, everyone. I guess I wanted to ask a lot of the big picture questions have been asked. I wanted to ask about the impact of the California wildfires.

[Justin Hauke, Vice President and Senior Research Associate at Robert W. Baird & Co]

Yes, I don't really think of that as storm work the same way that hurricanes knocked down lines, but just curious if that's had any impact to you here in the first quarter? And maybe more importantly, just the long term thinking about undergrounding lines and your ability to do that and kind of the cost differential versus overhead lines, just kind of the long term rebuild impact, if you could comment on that.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We were involved in some of the underground in California now, and it continues to progress nicely out on out. It's it's expensive. It is. So there's no question about it. But if if between that and taking fire risk, I think it's probably not expensive.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

When you when you really look at the long term nature of of the business, I I do we do see violent weather across, you know, whether it's winter weather today or or, you know, storms that hurricanes, fires. We're seeing it and it impacts of it. So I think as an industry, you're seeing the hardening programs in the West. You know, certainly, energy's got a resilient program ongoing that we're involved in. So we're involved in every one of them, with our clients and trying to harden the grid and and de risk their business.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

I don't think anyone ever intended to take fire risk on on the line thirty five years ago, forty, fifty years ago. So we have to, you know, put for ourselves and try to help and collaborate on what we see across the board to make the grid more resilient, more modern, and we're doing that. There's technologies out and things like that that are coming along as well. So, you know, everyone's everyone's kinda in this new paradigm of of these violent events, and we're we're gotta harden the grid. And, we're seeing that ongoing, and we'll continue to see it for for decades or more.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We we built this grid over the last sixty, seventy years. We've got a long way to go. And so I I do see that happening, and we've got to, you know, get in front of that as an industry. And there is risk out from from fire as well. I mean, I we have to watch ourselves in the risk that we have on fire in in in the West.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

So I I do think how we interact and how we make sure that the company derisk ourselves in the middle of, of of the fire is something that we watch as well. So no. Look. We're all in it together with the clients and and working hard to try to to make a difference and make sure that we spare human life when these events happen.

[Justin Hauke, Vice President and Senior Research Associate at Robert W. Baird & Co]

Okay. Thank you very much.

[Operator]

Your next question will come from the line of Brian Brophy with Stifel Nicolaus. Your line is open. Please go ahead.

[Brian Brophy, Associate Vice President at Stifel Financial]

Thanks. Good morning, everybody. I was hoping you could talk about the communications outlook here a bit and any more detail on this, Lumin announcement that you made here. How how meaningful could that be? And when should we start thinking about contributions on that front?

[Brian Brophy, Associate Vice President at Stifel Financial]

Thanks.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yeah. I was just trying to make sure you guys knew we were still in the telecom business. But but in general, look, we had a nice award there. We continue to grow the business. We we continue to, you know, incrementally move it forward.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

The the data center demand on fiber is is big. I mean, it probably goes unnoticed a bit on everything else, but I do think we continue to see long haul fiber opportunities as well. It's just our core business in communications. We love the business. We're growing it, like I said, nicely.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

And then sometimes it goes unnoticed, but I thought the award was meaningful and something that the investment community should see that we're we're still, we're much larger. And I said it before, our addressable markets continue to, grow. And where the company was five years ago versus where it's at today is much different from an addressable market standpoint. So when you look at the growth going forward, you can see it across multiple segments, whether it's communication technology or utilities. We can go on and on, but I I just think that is something that goes unnoticed.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

And I wanna make sure that everyone realizes that our addressable markets across this company have grown and are getting larger.

[Brian Brophy, Associate Vice President at Stifel Financial]

Appreciate it. I'll pass it on.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Please.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Please.

[Operator]

Our next question will come from Adam Thalimer with sorry, Adam Thalimer with Thompson Davis.

[Adam Thalhimer, Director of Research at Thompson Davis & Co]

Hey. Good morning, guys. I had the same question, actually. I was curious about Lumen. What else you're seeing in terms of long haul fiber?

[Adam Thalhimer, Director of Research at Thompson Davis & Co]

Could you book another award of a similar magnitude? And then, Jayshree, curious if you can comment on the tax rate. It was a a decent step up, year over year. Just wanted to see what was going on there. Thank you.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Now we kind of talked about, you know, telecom being a billion. We're growing off a billion, and we base base there. And I do think we'll we'll see growth in long haul. We bought some smaller businesses three or four years ago. They're really growing nicely.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Our markets are growing. There's no shortage of demand on on infrastructure around, you know, the telecom data space. So I I do see us, you know, getting more awards and and we're we can deliver on a national footprint. We talk about the utilizations of some of our underground, business moving over into telecom. That can still happen.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

So we're leveraging all assets and leveraging people across these TAMs. And so I do think our ability to move resources across these customer bases is something that you'll continue to see the company move forward, and we're in multiple conversations across, you know, what I would consider all all businesses of and there's growth to every one of them. Infrastructure for the next two decades that I see out is significant. We're right in the middle of it with with our craft skilled labor and engineering capabilities.

[Jayshree Desai, Chief Financial Officer at Quanta Services]

Yeah. And as for the tax rate, I think a couple of things. One, we had a nice, we did some nice tax planning here that came through at the end of the year that allowed us to clean up some legal entities and take the tax benefit this year. As well as going into '27 '25, we had this year, we had the big benefit as well earlier in the year of the RSU vesting. We're assuming a lower vest rate and, grant vesting of the stock price in 2025.

[Jayshree Desai, Chief Financial Officer at Quanta Services]

And so you see that as well. The combination of both those things are why you're seeing a step up in the tax rate.

[Adam Thalhimer, Director of Research at Thompson Davis & Co]

Thanks guys.

[Operator]

Our next question will come from the line of Drew Chamberlain with JPMorgan. Please unmute and ask your question.

[Drew Chamberlain, Equity Research Associate at JP Morgan Chase & Co]

Yeah. Good morning and thanks for taking the question. Just a bit of a follow-up on the renewables bookings. Obviously, good to see the strong momentum there. But can you just kind of break that out a little bit on what you're seeing from a technology standpoint and where demand is, kind of project profiles that are coming from your customers.

[Drew Chamberlain, Equity Research Associate at JP Morgan Chase & Co]

And then also, what you're hearing on the safe harbor impact that you touched upon briefly earlier and how much that could either have already gone into the backlog or that's already being at play and what the outlook could be for further safe harbor type wins in 2025?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yes. I think when we're looking at the renewable business, I mean, certainly, like, there's noise that continues. But our ability to book work there and what we see and how we can deliver across that market, like, we're not seeing any pullback. And so we're actually seeing more demand. And there's safe harbor.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

The safe harbor is really meant to our customers are buying equipment, they're doing the things that are necessary to make sure that their projects are protected for the long term. And the smart, the bigger ones, our customer base that we work for know, typically do that. And, you know, we're comp I don't you're not seeing the meaningful impact of, you know, call it beyond 12 backlog because of safe harboring at this point. We just see the market and the strength to it long term. And as far as the data center demand and if you were going to build generation tomorrow, I would just ask what would you build and how quickly could you build it?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

And you're going you would find yourself building a solar plant, probably. It's the fastest thing you can build. And I I just think the the way you go to market right now, no one wants to hear forty eight months. They wanna hear forty eight minutes. And so I think that will be key on how we look at the business.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

It won't be as much about what form of generation will be, how quick can you get it.

[Drew Chamberlain, Equity Research Associate at JP Morgan Chase & Co]

Great. Thanks, Duke.

[Operator]

Our next question will come from the line of Sangeeta Jain with Keystone. Please unmute and ask your question.

[Sangita Jain, Senior Analyst at KeyBanc Capital Markets]

Hey. Thanks for taking my question. So if I can ask on the civil acquisition that you made, is that mostly Texas oriented now? I'm trying to see if you can leverage that to your Cupertino low voltage work for data centers maybe.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yeah. I mean, I I think, then, Sangeeta, but, yes. It's Southeast based, not just Texas, but Southeast. We can we can move it out. They have a lot of capabilities, engineering capabilities, and we need to expand the business.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

So so yes. I mean, certainly, we can we can expand. When when we look at it, you know, Cupertino works all across the Lower 48. So they're in Texas as well in the Southeast, and there's a lot of Southeast expansions and Texas expansions.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

You know,

[Duke Austin, President & Chief Executive Officer at Quanta Services]

I I just think our synergies would allow us to really grow the business. We could probably absorb the whole business internally with synergies internally. So, that's not not gonna be the case. They get involved in industrial base, LNG, all kinds of different things. And so we're super excited about having the capabilities.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

And I think when we look at acquisitions, we weren't looking for, a civil business. But when we we know the business well, and it's it's really the culture of the DNA, what we look for in management teams and how we go about our our ability to put strategies forth and solutions to our clients. And also the the quality of of the management teams are so paramount when we look at acquisitions that, this is a long standing business, fifty plus years old generationally, that we're super excited that those solutions will be something that, both internally and externally, you know, you can see. And sometimes you can't see it, but we certainly see it. And we lack opportunities there.

[Sangita Jain, Senior Analyst at KeyBanc Capital Markets]

Great. Appreciate it. Thank you.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Sure.

[Operator]

Your next question will come from the line of Mark Bianchi with Cowen. Please unmute and ask your question.

[Marc Bianchi, Analyst at Cowen]

Hi. Thanks. I wanted to ask on the the outlook for underground here in, in '25. So, '24 was a bit of a lower margin year for that business. And you're showing sort of an expectation for improvement in '25 and particularly, the year over year improvement as we get past the first quarter, looks like it's a pretty good step up.

[Marc Bianchi, Analyst at Cowen]

So I was hoping you could kind of unpack kind of what happened in 'twenty four and what's driving the confidence in the bounce back in 'twenty five.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yeah. A couple of things. Your industrial business was down a bit and, you know, the margins were down. We had some storms come through the the Gulf Coast and impact us in the back half. So so part of it is, you know, our industrial business gets better.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Canada, we're coming off big pipe in Canada. And so that's some of the impacts that are going back into your LDC business that we have growth in. And then, you know, when you look at the acquisitions, it's accretive. So the acquisitions are accretive. We have a better industrial margin profile going forward as well as our LDC business and our core business, in the utility space.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

People are starting to put more capital back into the gas business. So we're seeing that come back into the core. So all those things kind of come together and that's why you're seeing the impacts of margins going forward. But I would still say that we're leveraging the underground capabilities of gas across into telecom and into, electric space on any given day. So you can see some, pullback and then electric may go up 200,000,000 of of gas assets and people that move over there three or 400.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

So you can see that on any given day in the business. If it was up to me, I'd have one segment, but it's not. So, like, we we have two and, it does cross. But I do like our business in totality and I think it's something that we'll continue to see margin improvement. We're still not happy with where it's at and I do believe you can get in the upper single digits there or maybe even double digits.

[Marc Bianchi, Analyst at Cowen]

Great. Thanks so much, Duke. I'll turn it back.

[Operator]

Our next question will come from the line of Gus Richard with Northland Capital Markets. Please unmute and ask your question.

[Gus Richard, MD & Senior Research Analyst at Northland Capital Markets]

Yes. Thanks for taking the question. On the federal level, there's a lot of changes. You've got indiscriminate layoffs by the, you know, government efficiency bureau, and that could slow approval processes. You've got the potential of deregulation to speed things up.

[Gus Richard, MD & Senior Research Analyst at Northland Capital Markets]

You've got the potential of bands of solar panels being imported, another impact. And I'm just wondering if you're seeing anything at this point due to these potential changes and sort of what's your expectation on, you know, how easy it'll get projects to get done? Will it get pulled in or pushed out?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Good question. Really try to put my head down and work and not listen too much to it because it changes by the minute. I don't fundamentally, from the customers and and how we see it and what we've got it to, we've taken into account. We've been very prudent about how we've got it, to the midpoint. And anything that we've seen or think that could be a possibility, we've baked into our guidance at this point.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

So I feel comfortable that across our addressable markets, we have room to expand on any given day. But you're right. I mean, one day, know, some things are really, really good for certain parts of the business and some things, you know, could impact a bit. But in totality, we see growth, we see opportunity, and everything I hear is just opportunity. I don't think, you know, when when you look at it, there's still a lot of if you go back to first term, a lot of this happened then, and we we did nicely, and we continue to grow the business.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

I think the same thing will happen. It will never be as good as you think, and it'll never be as bad as you think. So we'll be right down the middle with it. And, you know, the great thing is is under any scenario, demand is gonna out seed outpace supply at this point. And we just we have to really try to figure out how to get in front of that, would be more important.

[Gus Richard, MD & Senior Research Analyst at Northland Capital Markets]

Great. Thanks for the answer.

[Operator]

Your next question comes from the line of Joseph Osha with Guggenheim Partners. Please go ahead.

[Joseph Osha, Senior Managing Director, Equity Research at Guggenheim Partners]

Thanks. Good morning. Can you hear me okay?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yes.

[Joseph Osha, Senior Managing Director, Equity Research at Guggenheim Partners]

Okay.

[Joseph Osha, Senior Managing Director, Equity Research at Guggenheim Partners]

Great.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Got you.

[Joseph Osha, Senior Managing Director, Equity Research at Guggenheim Partners]

Duke, you alluded to this

[Joseph Osha, Senior Managing Director, Equity Research at Guggenheim Partners]

a little earlier. Obviously,

[Joseph Osha, Senior Managing Director, Equity Research at Guggenheim Partners]

lead times are way out

[Joseph Osha, Senior Managing Director, Equity Research at Guggenheim Partners]

there for combined cycle machines. But I was at PowerGen last weekend. You know, we're starting to hear sort of the same thing happening on the single cycle side, as people look to put, you know, peaking power alongside, you know, renewables. So I'm just wondering, how are you seeing your mix evolve? And are you starting to see that same kind of frenzy and longer lead times on the single cycle side as well?

[Joseph Osha, Senior Managing Director, Equity Research at Guggenheim Partners]

Thank

[Joseph Osha, Senior Managing Director, Equity Research at Guggenheim Partners]

you.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yeah. I mean, the single cycle business for us, we're certainly capable, and I'm not concerned near as much, building a single cycle. So, yes, we'll be around the edges on that. We do see a lot of opportunity there, you know, whether it be you know, you have a lot of diesel generation backup today.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

I think the single cycles will be forms of energy you can back up and use them in merchant type situations and things of that nature. So and it is way quicker to market with single cycle. So I I do think that'll be a part of the solution to get the, you know, the project started quicker. So I we see the opportunity as well and, the company is well positioned to take advantage of those type of arrangements.

[Joseph Osha, Senior Managing Director, Equity Research at Guggenheim Partners]

Thank you.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Absolutely.

[Operator]

Our next question will come from the line of Brent Thielman with D. A. Davidson. All right. We'll go to Phil Shen with Roth Capital and we can return to you Brent.

[Philip Shen, Managing Director, Senior Research Analyst at Roth Capital Partners, LLC]

Phil, can you hear me okay?

[Operator]

We can. Please go ahead.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yes.

[Philip Shen, Managing Director, Senior Research Analyst at Roth Capital Partners, LLC]

Thanks. Thanks for taking my question. I wanted to go back to the AI data center theme. What opportunities are you conceptualizing now that could deepen your exposure to the AI data center trend beyond Cupertino? You emphasize that you're a solutions provider kinds of problems are your data center related customers experiencing that you could support in a deeper way than you do now?

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Yes. I mean, look, we're taking the same approach with the data center owners that we are with the utilities and that intersection as well. So, you know, our ability to talk to our clients on the utility side help them and help the data centers and and stay in the middle. We wanna build infrastructure, all types of infrastructure. It involves craft skill, if it involves engineering, if it involves, you know, anything really, to be honest, like, we're certainly in the middle of those discussions in how do we help collaborate to move things faster, more efficiently across both customers as well as our renewables as well.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

So look, it's a convergence. We see it, and we're in the middle of it, and we we will be, you know, trying to take advantage of those markets on a go forward basis that we see. And and we've said all along that we feel comfortable with craft skill. We feel comfortable building up our capacity on the front end side of the business and using those service lines to provide a solution. So there's not much we're not talking about with these clients.

[Philip Shen, Managing Director, Senior Research Analyst at Roth Capital Partners, LLC]

Great. Thanks, Steve.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Sure.

[Operator]

And there are no more questions at this time. I'd now like to turn the call back over to management for closing remarks.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

Thank you. I wanna thank the 60,000 plus employees. They're the best in the business. They allow us to have this call today, and they're building what I consider the infrastructure of the future. We wanna thank them, and I wanna thank you for participating in our conference call.

[Duke Austin, President & Chief Executive Officer at Quanta Services]

We appreciate your questions, your ongoing interest in Commod Services. Thank you. This concludes our call.

Participants

Executives

• Kip Rupp, VP of IR
• Duke Austin, President & Chief Executive Officer
• Jayshree Desai, Chief Financial Officer

Analysts

• Chad Dillard, Analyst at Bernstein
• Atidrip Modak, Vice President - Energy Services & E&Ps at Goldman Sachs
• Jamie Cook, Managing Director - Equity Research at Truist Securities
• Steven Fisher, Managing Director & Equity Research Analyst at UBS Group
• Julien Dumoulin-Smith, Research Analyst at Jefferies Financial Group
• Steve Fleishman, Managing Director and Senior Analyst at Wolfe Research LLC
• Justin Hauke, Vice President and Senior Research Associate at Robert W. Baird & Co
• Brian Brophy, Associate Vice President at Stifel Financial
• Adam Thalhimer, Director of Research at Thompson Davis & Co
• Drew Chamberlain, Equity Research Associate at JP Morgan Chase & Co
• Sangita Jain, Senior Analyst at KeyBanc Capital Markets
• Marc Bianchi, Analyst at Cowen
• Gus Richard, MD & Senior Research Analyst at Northland Capital Markets
• Joseph Osha, Senior Managing Director, Equity Research at Guggenheim Partners
• Philip Shen, Managing Director, Senior Research Analyst at Roth Capital Partners, LLC