Tetra Tech — Fiscal Year 2026 Earnings Summary

Financial Performance:

• Q4 2026 total revenue was $1.34 billion; net revenue (revenue net of subcontractor costs) was $1.15 billion, a 5% year-over-year increase excluding episodic disaster response.
• Fiscal 2026 total revenue was $5.08 billion; net revenue was $4.35 billion, a 7% year-over-year increase excluding USAID/DOS and episodic disaster response.
• Q4 2026 operating income was $188 million; adjusted EBITDA was $194 million with a margin expansion of 90 basis points year-over-year.
• Fiscal 2026 operating income was $619 million; adjusted EBITDA was $660 million with a margin expansion of 90 basis points year-over-year.
• Q4 2026 EPS was $0.51 and adjusted EPS was $0.49, up 9% year-over-year.
• Fiscal 2026 EPS was $1.69 and adjusted EPS was $1.60.
• Fiscal 2026 cash flows from operations were up 14% year-over-year to $523 million.
• Q4 2026 backlog was $4.67 billion, up 13% year-over-year.
• Cash and cash equivalents increased to $235.1 million at September 27, 2026, from $167.5 million at September 28, 2025.
• Long-term debt increased to $892.0 million at September 27, 2026, from $763.4 million at September 28, 2025.
• Total stockholders' equity increased to $1.88 billion at September 27, 2026, from $1.78 billion at September 28, 2025.

Guidance and Future Outlook:

• Q1 2027 net revenue is expected to range from $1.04 billion to $1.08 billion; EPS is expected to range from $0.36 to $0.38.
• Fiscal 2027 net revenue is expected to range from $4.425 billion to $4.625 billion; EPS is expected to range from $1.65 to $1.80.
• Management expressed confidence in continued revenue growth and further margin expansion driven by strong backlog momentum.

Business Segments and Product Lines:

• GSG Segment Q4 2026 revenue was $627.8 million; Net Revenue was $512.6 million.
• CIG Segment Q4 2026 revenue was $729.5 million; Net Revenue was $640.3 million.
• Recent key wins include a $1.4 billion multiple-award blanket purchase agreement for enterprise logistics services for NASA.
• Recent key wins include a $145 million multiple-award contract for engineering and technical consulting services for the U.S. Navy.
• Recent key wins include a $141 million single-award contract for water infrastructure assessment services for the U.S. EPA.
• Recent key wins include an $85 million multiple-award contract for environmental services for USACE Europe District.
• Recent key wins include a $63 million single-award contract for emergency preparedness and response services for the U.S. EPA.
• Recent key wins include a $49 million multiple-award contract for geospatial and engineering services for NOAA.
• Recent key wins include a $14 million single-award contract for digital systems modernization for LA Metro.
• Recent key wins include a $12.7 million single-award contract for technical services for the Millennium Challenge Corporation.
• Demand is increasing for differentiated technical services in water and environmental programs, including digital automation.
• Resilient infrastructure design services are growing globally with new contracts for water supply, coastal infrastructure, and defense modernization.

Market and Competitive Landscape:

• The company operates as a global provider of high-end technical and engineering services in water, environment, and sustainable infrastructure.
• The company has more than 25,000 employees.
• The company serves U.S. government agencies and private sector clients.

Risks and Challenges:

• Forward-looking statements are subject to risks including worldwide political and economic uncertainties, U.S. fiscal policy changes, and cyclicality in demand.
• Risks include fluctuation in demand for oil and gas and mining services, risks related to international operations, and concentration of revenues from U.S. government agencies.
• Risks include dependence on winning or renewing U.S. government contracts, potential funding disruptions, and the U.S. government's right to modify, delay, curtail, or terminate contracts.
• Risks include compliance with government procurement laws, global pandemics, credit risks, acquisition strategy and integration risks, and goodwill impairment.
• Risks include failure to comply with anti-bribery and export laws, project management failures, loss of key personnel, and workforce utilization issues.
• Risks include cyber security breaches, subcontractor performance failures, liquidated damages, and changes in environmental or infrastructure laws.
• Risks include access to capital, credit agreement covenants, industry competition, legal proceedings, and stock price volatility.

Management Commentary and Tone:

• CEO Roger Argus stated the fiscal year ended with a strong fourth quarter driven by global commercial and government businesses.
• CEO Roger Argus noted that key client programs drove backlog up by more than $530 million, an increase of 13% from last year.
• CFO Steve Burdick stated the company continued to increase profit margins with 90 basis points of EBITDA margin expansion from fiscal 2025.
• CFO Steve Burdick noted the strength of the balance sheet and consistent cash flow generation position the company to invest in organic growth and strategic acquisitions.

Other Key Points:

• The Board of Directors approved a quarterly dividend of $0.072 per share, an 11% increase year-over-year, payable on December 11, 2026.
• This marks the 46th consecutive double-digit increase in the company's quarterly dividend.
• In the fourth quarter of fiscal 2026, Tetra Tech repurchased $100 million of common stock.
• As of September 27, 2026, the company had $798 million remaining under its share repurchase program.
• Fiscal 2026 included a gain on sale of divested business of $12.4 million and no goodwill impairment charges.
• Fiscal 2025 included $115 million in legal contingency costs and $92.4 million in goodwill impairment charges.
• Fiscal 2026 capital expenditures were $20.5 million; payments for business acquisitions were $191.9 million.
• Fiscal 2026 total repurchases of common stock were $302.0 million.