Legence (LGN) Q4 2025 earnings summary

Executive summary

• Achieved record Q4 2025 revenue of $738 million, up 35% year-over-year, with most growth organic and both segments contributing.

• Adjusted EBITDA grew 53% in Q4 2025, with margin expansion of 140 basis points; full-year adjusted EBITDA rose 30% to $299 million.

• Backlog and awarded contracts reached a record $3.7 billion, up 49% year-over-year, with a Q4 book-to-bill ratio of 1.9x.

• Completed strategic acquisitions, including Bowers Group and Metrix Engineers, expanding capabilities and geographic reach.

• Labor force grew to 6,600 skilled craftspeople, supporting execution and backlog growth.

Financial highlights

• Q4 2025 revenue: $738 million (+35% YoY); full-year 2025 revenue: $2.6 billion (+22% YoY).

• Q4 2025 adjusted gross profit: $157 million (21.2% margin), up from $112 million (20.5%) YoY.

• Q4 2025 adjusted SG&A: $75 million (10.1% of revenue), up from $59 million (10.8%) YoY.

• Q4 2025 adjusted EBITDA: $87 million (11.8% margin), up 53% YoY.

• Net leverage ratio declined to 2x at year-end 2025; cash balance at year-end: $230 million; total debt: $825 million.

Outlook and guidance

• Q1 2026 revenue guidance: $925–$950 million; adjusted EBITDA: $90–$100 million.

• Full-year 2026 revenue guidance raised to $3.7–$3.9 billion; adjusted EBITDA to $400–$430 million.

• Over half of current backlog expected to convert to revenue in 2026, with visibility into 2028 and beyond.

• Effective tax rate for 2026 estimated at 35–40%; cash taxes in low $30 million range.