AECOM reported fourth‑quarter revenue of $4.18 billion, up 2% from $4.10 billion in the same period a year earlier, and a full‑year revenue of $16.14 billion, essentially flat against the $16.10 billion reported for FY2024. Net service revenue—its core high‑margin business—rose 8% to $1.94 billion in Q4 and 6% to $7.57 billion for the year, reflecting continued demand for advisory and program‑management services. Operating income was $236 million in Q4, unchanged from the $236 million reported for Q4 FY2024, and $827 million for the full year, a 14% increase from the $727 million recorded in FY2024. Segment operating margins reached 17.1% in Q4 and 16.5% for the year, record levels that underscore the success of AECOM’s asset‑light transformation. Net income fell to $132 million in Q4, a 22% decline from the $168 million reported for Q4 FY2024, but rose to $182 million for the year, a 6% increase over the $172 million of FY2024. Diluted earnings per share were $0.99 in Q4, down from $1.25 in Q4 FY2024, and $1.36 for the year, up from $1.25 in FY2024. Free cash flow rebounded to $134 million in Q4, a 51% increase from the $274.6 million of Q4 FY2024, and $685 million for the year, a 3% rise from the $708 million of FY2024. Backlog grew to $24.83 billion, up 4% year‑over‑year, providing a strong pipeline for future revenue.
The modest revenue growth in Q4 was driven by a 2% increase in high‑margin advisory services, offsetting a slight decline in construction‑related revenue that faced tighter pricing pressure. The 6% rise in full‑year net service revenue reflects a shift in the mix toward higher‑margin consulting contracts, a trend that has been a key pillar of AECOM’s asset‑light strategy. Operating income remained flat in Q4 because the company’s cost‑control initiatives—particularly in procurement and labor—balanced the higher revenue mix, while the full‑year operating income increase was largely due to a 14% rise in operating margin, driven by higher utilization of high‑margin advisory work and improved operational leverage.
Net income and EPS fell in Q4 because of a one‑time restructuring charge of $30 million that was not present in the prior year, while the full‑year net income increase was offset by the same charge and a modest decline in interest expense. The Q4 EPS of $0.99 was a $0.26 beat over the consensus estimate of $0.73, driven by the company’s disciplined cost management and the higher mix of high‑margin services. The full‑year EPS of $1.36 beat the consensus of $1.10 by $0.26, reflecting the cumulative effect of margin expansion and the company’s focus on high‑margin advisory work.
Management reiterated confidence in its 2026 outlook, citing a robust backlog and continued investment in AI‑enabled advisory services. The company reaffirmed its full‑year 2025 adjusted earnings‑per‑share guidance of $5.10 to $5.20, up from the $4.90 to $5.00 range previously set, and raised its 2026 guidance to $5.65 to $5.85. CFO Gaurav Kapoor highlighted that the asset‑light transformation has delivered a 17%+ margin target and that the company is well positioned to further expand margins. CEO Troy Rudd emphasized that the record backlog and high‑margin mix provide a strong foundation for future earnings growth.
AECOM’s net leverage ratio of 0.8x as of September 30, 2025, and its disciplined capital allocation—share repurchases and dividend increases—underscore the company’s financial strength and its ability to fund growth initiatives while returning value to shareholders.
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