Jacobs Delivers Mixed Q2: Revenue Tops, Guidance Held, AMTM Loss Weighs On Results

Jacobs Solutions Inc (NYSE:J) shares edged lower on Tuesday after the company reported second-quarter 2025 results. Revenue rose 2.2% year-over-year to $2.91 billion, topping the $2.18 billion consensus.

Adjusted revenue grew 3.1% year-over-year to $2.14 billion. Adjusted EPS was $1.43, up from $1.17 a year ago, above the consensus of $1.39.

Gross margin was at 25.4% YoY, up 36 bps, and gross profit rose 3.7% to $738.35 million. Operating margin expanded 73 bps to 7.2% YoY, and operating profit rose 13.9% to $208.65 million.

Jacobs reported a $109.5 million mark-to-market loss on the AMTM investment, lowering the quarter’s GAAP net income.

The quarterly backlog reached $22.2 billion, up 20% year-over-year, with a book-to-bill ratio of 1.1x (1.3x on a trailing twelve-month basis).

Operating cash used in operating activities for the quarter totaled $96.43 million, compared to $42.82 million a year ago.

The company delivered record capital returns to shareholders in the first half of the year, repurchasing $351 million in shares during the second quarter and $552 million over the first half.

Jacobs’ Chair and CEO Bob Pragada said, “We ended the first half of FY25 with solid performance across our business, led by strong Life Sciences, Transportation, and Energy & Power revenue growth within Infrastructure & Advanced Facilities (I&AF). Additionally, we saw strong results in PA Consulting, with revenue growth rising to 5% in the second quarter, driving 12% operating profit growth for the segment. As we look ahead to the second half of the fiscal year, we continue to see tailwinds in both segments from robust bookings and a healthy pipeline of opportunities across our end markets. Based on this performance, we are reaffirming our full-year fiscal 2025 guidance.”

The company also retired $312 million in debt through an equity-for-debt exchange using its stake in AMTM and refinanced approximately $700 million of existing debt at a lower interest rate, significantly strengthening its balance sheet exiting Q2 2025.

Pragada added, “Following the quarter’s close, we reached a key milestone in separating the former CMS and C&I businesses by finalizing the post-closing working capital adjustment, enabling additional debt reduction in Q3 2025, and receiving Board approval to distribute the remaining Amentum shares to our shareholders on May 30th.”

2025 Outlook reaffirmed: Jacobs sees adjusted net revenue growing mid-to-high single digits, with an EBITDA margin of 13.8-14.0% and FCF conversion exceeding 100% of net income.

The company expects adjusted EPS of $5.85 – $6.20 (versus the $6.03 consensus) for 2025.

Price Action: J shares are trading lower by 4.76% at $120.52 on Tuesday’s last check.

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