MasTec Q2 Earnings Call Highlights

Key Points

• MasTec delivered a strong second quarter: Revenue rose 23% year over year to $4.374 billion, adjusted EBITDA increased 40% to $384 million, and adjusted EPS climbed 49% to $2.22. Record backlog reached $21.4 billion, supported by a book-to-bill ratio above 1.2x.
• The company raised its 2026 outlook following the acquisition of The Superior Group, forecasting $18.2 billion in revenue, $1.6 billion in adjusted EBITDA and $9.30 in adjusted EPS. Superior expands MasTec’s electrical-infrastructure capabilities for data centers and other mission-critical facilities.
• Growth remains concentrated outside communications: Power Delivery, Pipeline Infrastructure, and Clean Energy posted strong demand and backlog growth, while communications guidance was reduced because of wireless activity slowdowns and deferred wireline projects. Management remains optimistic about longer-term fiber, hyperscaler, data-center and grid-infrastructure opportunities.

MasTec NYSE: MTZ reported second-quarter 2026 revenue of $4.374 billion, up 23% from a year earlier, as growth in its power delivery, pipeline and clean energy businesses offset emerging pressure in communications. Adjusted EBITDA increased 40% year over year to $384 million, while adjusted earnings per share rose 49% to $2.22.

Chief Executive Officer José Mas said revenue, EBITDA and earnings per share each exceeded the company’s guidance. Adjusted EBITDA margin improved by 100 basis points from the prior-year quarter, while total company book-to-bill exceeded 1.2x. Quarter-end backlog reached a record $21.4 billion, up nearly $5 billion year over year and roughly $1 billion organically from the prior quarter.

“We delivered another excellent quarter,” Mas said, adding that the company set highs across “virtually every key financial metric.” He said demand continued to strengthen across MasTec’s end markets despite what he characterized as increased market noise in recent weeks.

Guidance Raised Following Superior Acquisition

MasTec raised its full-year outlook following the July close of its acquisition of The Superior Group, which Mas described as the largest acquisition in the company’s history. The transaction expands MasTec’s electrical-infrastructure capabilities for mission-critical facilities and data centers, while adding a workforce of about 3,000 people, according to Chief Financial Officer Paul DiMarco.

• Full-year revenue is now expected to reach $18.2 billion.
• Adjusted EBITDA is expected to total $1.6 billion.
• Adjusted EPS is forecast at $9.30.
• Third-quarter revenue is expected to be about $4.9 billion, with adjusted EBITDA of $482 million and adjusted EPS of $2.98.

The updated full-year targets represent year-over-year growth of 27% in revenue, 39% in adjusted EBITDA and 42% in adjusted EPS, Mas said. The company expects Superior’s contribution, combined with stronger-than-expected performance in several legacy operations, to offset reduced expectations for communications.

DiMarco said MasTec expects more than $1 billion in cash flow from operations during 2026, with most of that amount expected in the fourth quarter. Cash flow from operations was essentially flat in the second quarter as working-capital investment offset earnings growth. Net leverage was 1.8x at quarter-end and would have been 2.2x on a pro forma basis for the Superior acquisition; MasTec expects leverage to be below 2x by year-end.

Communications Outlook Reduced on Deferrals

MasTec lowered its outlook for the communications segment, citing lower wireless activity in the second half and deferred wireline projects. The segment generated about $890 million in second-quarter revenue and $73 million in EBITDA, for an EBITDA margin of approximately 8.2%.

DiMarco said execution challenges on certain projects, along with higher indirect fuel and equipment expenses, resulted in lower profit flow-through than anticipated. The company now expects full-year communications revenue of approximately $3.25 billion and EBITDA margins in the high single digits, about 100 basis points below the prior year.

For the third quarter, MasTec forecasts communications revenue of roughly $800 million with high-single-digit adjusted EBITDA margins. The company is also using the period to right-size its operational support model and rationalize select markets, DiMarco said.

Mas said the reduction does not reflect a decline in customer capital investment, but rather changes in spending timing. Wireless construction has been affected as carriers wait for equipment associated with newly acquired spectrum, while wireline projects have been delayed after certain Rural Digital Opportunity Fund projects rolled off and replacement work encountered later starts and permitting issues.

In response to an analyst question, Mas said the communications shortfall was roughly split between wireless and wireline, with a somewhat greater impact from wireless. He said the wireline delays were concentrated among a couple of customers. The company expects second-half communications margins to improve by about 200 basis points from first-half levels despite the revenue pressure.

MasTec remains constructive on long-term opportunities in fiber deployment, broadband infrastructure and hyperscaler connectivity. Mas said the company is pursuing multiple hyperscaler-related projects exceeding $1 billion and expects some of that work to affect 2027 rather than 2026.

Power, Pipeline and Clean Energy Drive Growth

Power Delivery generated approximately $1.25 billion of second-quarter revenue and $113 million of EBITDA, producing margins above 9%. Revenue increased nearly 20% year over year, while backlog rose to a record $6.3 billion. DiMarco said utility investment is being supported by grid modernization, electrification, reliability requirements and increasing power needs tied to data center development.

Including Superior, MasTec expects third-quarter Power Delivery revenue of approximately $1.6 billion and low-double-digit EBITDA margins. Full-year revenue is projected at roughly $5.725 billion, also with low-double-digit margins. Mas said the company’s legacy Power Delivery business is expected to produce an approximately 9.8% full-year margin, above prior guidance.

Pipeline Infrastructure delivered $643 million in second-quarter revenue and approximately $119 million in EBITDA, representing an 18.4% margin. Segment backlog rose 35% sequentially to about $1.8 billion, with a 1.7x book-to-bill ratio. Mas said a recently signed project that contributed to backlog is scheduled for 2027, limiting its effect on current-year revenue.

Management said pipeline visibility extends beyond reported backlog because of customer engagement and project-development activity. Mas said the company expects the second half of 2027 to be substantially larger than the first half in pipeline activity and remains optimistic about 2028 and 2029.

Clean Energy and Infrastructure produced more than $1.6 billion in revenue and $128 million in EBITDA. Segment backlog increased about $500 million sequentially to approximately $7.8 billion, supported by renewables, civil infrastructure, industrial construction and general building activity. MasTec expects third-quarter revenue of about $1.9 billion and full-year revenue of approximately $6.8 billion, with high-single-digit EBITDA margins.

Mas said solar represents roughly 60% to 65% of the company’s renewables business, though the company continues to see resilient wind demand and has secured wind backlog for 2027. He also cited growing pursuits involving simple-cycle generation, reciprocating internal combustion engines, water infrastructure and turnkey data center construction.

Mission-Critical Opportunity Expands

Management repeatedly pointed to mission-critical infrastructure, including data centers, power generation, transmission and connectivity, as a major long-term growth driver. Mas said backlog should finish 2026 above its current level, with Power Delivery, Clean Energy and Infrastructure, and Pipeline expected to drive growth.

He said MasTec’s $2.5 billion of backlog growth during the first half will have only a modest impact on 2026 revenue, with most expected to benefit 2027. The company also said its second-quarter backlog growth did not include the larger billion-dollar pursuits it is currently pursuing.

On potential restrictions on data center development in certain states, Mas said the geographies cited by an analyst were generally not major MasTec markets. He said the company is seeing communities and state-level discussions that support expanded data center development, and that it does not expect such actions to have a significant effect on the business.

About MasTec (NYSE:MTZ)

MasTec, Inc is a diversified infrastructure construction company that provides engineering, fabrication, installation and maintenance services across a broad range of end markets. Its principal activities encompass the development of communications networks, oil and gas pipeline systems, electrical transmission and distribution facilities, industrial installations and renewable energy projects.

The company traces its roots to a small cable installation operation in Miami and has grown through a series of strategic acquisitions to become one of the largest infrastructure contractors in North America.

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