Knife River Corp (NYSE:KNF) Reports Mixed Q3 2025 Results with Revenue Miss and Strong EBITDA

Knife River Corp (NYSE:KNF) reported third quarter financial results that presented a mixed picture for investors, with revenue falling short of analyst expectations while earnings demonstrated resilience in the face of operational headwinds. The construction materials company navigated a challenging quarter marked by weather disruptions and regional market softness while maintaining profitability through strategic pricing and cost management initiatives.

Quarterly Performance Versus Estimates

The company reported revenue of $1.20 billion for the third quarter of 2025, representing a 9% increase over the prior year period but falling approximately $21 million short of the $1.22 billion analysts had projected. Despite this revenue miss, Knife River delivered earnings per share of $2.52, which came in slightly below the $2.61 consensus estimate.

Key financial metrics from the quarter include:

• Revenue: $1.20 billion (9% year-over-year growth)
• Net income: $143.2 million (3% decrease year-over-year)
• Adjusted EBITDA: $272.8 million (11% year-over-year improvement)
• Adjusted EBITDA margin: 22.7% (50 basis point expansion)

Market Reaction and Price Action

The market response to these results has been notably positive in early trading, with shares rising approximately 6.4% in pre-market activity. This upward movement suggests investors are focusing on the company's record adjusted EBITDA and improved margins rather than the revenue shortfall. The positive reaction may also reflect optimism about the company's record backlog and narrowed full-year guidance.

Operational Highlights and Challenges

Knife River's performance reflected both strengths and challenges across its geographic segments. The company achieved record results in its West and Central segments, with the Central segment showing particularly strong growth of 22% in revenue and 25% in EBITDA. However, the Mountain segment experienced a 12% decline in revenue due to reduced asphalt paving work, permitting delays, and weather-related disruptions.

Management highlighted several significant operational factors:

• Record backlog of $995 million, representing a 32% year-over-year increase
• Gross margin improvements across all major product lines
• Significant weather challenges, including flooding in Texas that impacted operations for 51 days
• Continued integration of recent acquisitions that contributed to revenue growth

2025 Outlook and Analyst Comparisons

The company narrowed its full-year 2025 guidance, now expecting revenue between $3.1 billion and $3.15 billion and adjusted EBITDA between $475 million and $500 million. This revenue guidance range sits slightly below the analyst consensus estimate of $3.2 billion for full-year sales, while providing investors with more precise expectations for the remainder of the fiscal year.

Strategic Positioning and Future Prospects

President and CEO Brian Gray emphasized that the company's "Competitive EDGE strategy" is delivering results despite external challenges. The record backlog, which is predominantly composed of public work projects, provides visibility into future revenue streams, with 77% expected to convert to revenue within the next 12 months. The company's focus on price optimization and cost controls has yielded improved margins even as it navigates regional market variability and weather-related disruptions.

For investors seeking more detailed earnings analysis and future estimates, additional information is available on the Knife River earnings and estimates page.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. The author has no position in KNIFE RIVER CORP (KNF). Investors should conduct their own research and consult with a financial advisor before making investment decisions.