What Tutor Perini (TPC) Said on Its Q3 Earnings Call

Key Points

• Tutor Perini raised its 2026 adjusted EPS forecast to $5.90–$6.10 from $5.15–$5.45, citing stronger project execution and reduced risks. It also expects double-digit revenue and earnings growth in 2027.
• Third-quarter revenue climbed 22% to $1.7 billion, and operating cash flow reached a company record of $331 million. Adjusted EPS rose to $1.83; results also included refinancing and pension-related charges, while the refinancing is expected to save $21 million in annual interest.
• The company ended the quarter with a near-record $20.4 billion backlog after booking $2.2 billion in awards and adjustments, and reported a potential-opportunity pipeline exceeding $200 billion. Margins improved across all three segments, with Specialty Contractors targeting its 5%–8% margin range in 2027.

Tutor Perini NYSE: TPC raised its 2026 adjusted earnings forecast after reporting record third-quarter revenue and operating cash flow, as activity increased on large construction projects and its backlog approached a record.

The contractor now expects adjusted earnings of $5.90 to $6.10 per share for 2026, up from its prior range of $5.15 to $5.45. CEO and President Gary Smalley attributed the increase to stronger-than-expected execution of the company’s backlog and mitigation of previously identified project risks.

Tutor Perini continues to anticipate double-digit revenue and earnings growth in 2027 as construction advances on newer large projects. Smalley said more than three-fourths of anticipated 2027 revenue was already represented in the company’s third-quarter ending backlog.

Record Revenue and Cash Flow

Third-quarter revenue rose 22% from a year earlier to $1.7 billion, while operating income more than tripled to $125 million. Operating cash flow increased 14% to $331 million, the highest for any quarter in the company’s history. For the first nine months of 2026, operating cash flow rose 16% to $665 million.

Net income attributable to Tutor Perini increased to $21 million, or 39 cents per share, from $4 million, or 7 cents per share, a year earlier. Adjusted net income rose to $98 million, or $1.83 per share, from $62 million, or $1.15 per share.

CFO Ryan Soroka said the quarter included a $51 million loss on debt extinguishment tied to a July refinancing and a $34 million non-cash charge related to the settlement of former pension plan obligations. Adjusted earnings excluded those items and share-based compensation expense, net of associated tax benefits.

Soroka said the refinancing reduced the coupon on the company’s senior notes to 6.625% from 11.875% and is expected to save $21 million in annual interest expense. Tutor Perini ended September with $404 million in total debt and cash and cash equivalents exceeding debt by $707 million.

Segment Margins Improve

Civil segment revenue rose 16% to $894 million, helped by work on projects including New York’s Midtown Bus Terminal Phase I and Manhattan Tunnel. Its operating margin increased to 14% from 12.9% a year earlier.

Building segment revenue rose 29% to $541 million, with its operating margin reaching 5%, up from 3.4%. Specialty Contractors revenue grew 26% to $286 million, and its margin improved to 3.5% from 2.7%.

Smalley said he sees potential for margins to rise across the segments, although Building margins depend more on project mix. He expects Specialty Contractors to reach its targeted 5% to 8% margin range sometime in 2027 as legacy items move off its books and newer work advances.

Asked about the fourth quarter, Soroka said the third quarter was a useful barometer for margins, although they could move up or down. He cited seasonality and an expected strong winter as potential headwinds.

Backlog and Bidding Pipeline

Tutor Perini booked $2.2 billion in new awards and contract adjustments during the quarter, ending September with a near-record backlog of $20.4 billion. Additions included $1 billion in additional work on a Civil project and $577 million in awards for federal government projects at Perini Management Services.

Smalley said the backlog includes nine major projects with a combined awarded value of $16 billion. Based on work currently in backlog, he estimated that the peak rate of execution could arrive around the latter part of 2028, while emphasizing that additional awards could support growth beyond then.

The company’s pipeline of potential opportunities exceeds $200 billion over the next three to four years, according to Smalley. Among the pursuits he identified were transit and infrastructure projects in California, the Hudson Tunnel Systems and Fit-Out Project in New York, and federal work in the Indo-Pacific region.

Black Construction is pursuing more than $4.6 billion in federal opportunities in the Indo-Pacific, including three bids worth nearly $1 billion that are awaiting customer decisions. Smalley said environmental reviews must be completed before one large project can be awarded. He also expects roughly $750 million in Building segment pre-construction work to enter backlog over approximately the next year to 18 months.

Data centers remain a small part of the company’s business. Smalley said Tutor Perini booked about $70 million in related projects earlier in the year but would pursue further opportunities selectively, rather than make data centers a focus.

About Tutor Perini (NYSE:TPC)

Tutor Perini Corporation NYSE: TPC is a construction company that provides general contracting, construction management, and design-build services. Its operations are organized around civil, building, and specialty contracting activities, serving public agencies, private developers, and other institutional customers.

The company's civil construction work includes major infrastructure such as highways, bridges, tunnels, mass-transit systems, airports, water and wastewater facilities, and other transportation and utility projects.

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