Granite Construction Posts Strong Q4 Earnings, Beats Estimates
GRANITE CONSTRUCTION INC (NYSE:GVA) reported financial results for the fourth quarter and full fiscal year 2025 that exceeded analyst expectations, driven by robust performance in both its construction and materials segments. The company's quarterly revenue and adjusted earnings per share came in above consensus forecasts, contributing to what management termed a "record year."
Earnings and Revenue Performance Versus Estimates
The civil contractor and materials producer delivered a solid top and bottom-line beat for the quarter ended December 31, 2025.
- Q4 2025 Revenue: Reported at $1.17 billion, surpassing the analyst consensus estimate of approximately $1.16 billion.
- Q4 2025 Adjusted EPS: Came in at $1.40 per diluted share, edging out the estimated $1.39.
For the full fiscal year 2025, the company's performance showed significant year-over-year improvement. Net income for the year was $193 million, or $3.86 per diluted share, compared to $126 million, or $2.62 per share, in 2024. On an adjusted basis, full-year net income was $276 million, or $6.07 per diluted share.
Market Reaction and Price Action
Despite the earnings beat, GVA shares were trading lower in pre-market activity, indicating a potential "sell-the-news" reaction or investor focus on forward-looking concerns such as guidance or margin dynamics. The stock had seen positive momentum in the lead-up to the report, gaining over 11% in the past two weeks and approximately 7.6% over the past month. The immediate negative reaction suggests the strong results may have been largely anticipated by the market, or that investors are scrutinizing other aspects of the report and outlook.
Key Highlights from the Quarterly Report
The earnings release highlighted several pillars of strength for Granite's business.
- Record Backlog: The company's Committed and Awarded Projects (CAP) reached an all-time high of $7.0 billion, a $1.7 billion increase from the end of 2024. This growth was primarily fueled by public-sector projects, with public CAP surging 47% year-over-year to $6.06 billion.
- Segment Strength: Both core divisions performed well. The Construction segment saw revenue increase 14.5% year-over-year in the quarter to $940.3 million. The Materials segment was a standout, with quarterly revenue jumping 44.3% to $225.0 million, driven by acquisitions and higher asphalt and aggregate prices.
- Profitability Metrics: Full-year adjusted EBITDA increased by $125 million to $527 million. The company noted improved execution and a higher-quality project portfolio contributing to profitability.
2026 Outlook and Comparison to Analyst Estimates
Management provided formal guidance for the 2026 fiscal year, projecting continued growth.
The company's revenue outlook of $4.9 billion to $5.1 billion sits comfortably above the current analyst consensus sales estimate of $4.93 billion for 2026, suggesting management confidence in the pipeline. However, the adjusted EBITDA margin guidance of 12.0% to 13.0% will be a key metric for investors to watch as the year progresses.
Other elements of the 2026 outlook include:
- SG&A expenses projected between 8.5% and 9.0% of revenue.
- Capital expenditures planned in the range of $140 million to $160 million.
Conclusion
Granite Construction closed its fiscal 2025 with powerful momentum, evidenced by record backlog, double-digit segment growth, and earnings that beat Wall Street forecasts. The company's 2026 revenue guidance indicates an expectation that this momentum will continue, supported by a robust pipeline of public infrastructure work. While the initial market reaction was muted, the fundamental picture painted by the earnings report is one of strength. The focus for investors will now shift to the company's ability to convert its record CAP into revenue while managing costs to hit its margin targets.
For a detailed look at Granite Construction's historical earnings and future analyst estimates, visit the earnings and estimates page for GVA.
Disclaimer: This article is for informational purposes only and does not constitute financial advice, a recommendation, or an offer to buy or sell any security. Investors should conduct their own research and consult with a qualified financial advisor before making any investment decisions.
