Tetra Tech reported record net revenue and operating income for the quarter ended September 28, 2025, driven by strong demand for its high‑end consulting services in water, environment and sustainable infrastructure. The company’s adjusted earnings per share of $0.45 beat the consensus estimate of $0.40 by $0.05, a 12.5% lift, while its GAAP EPS of $0.48 also surpassed expectations.
Revenue for the quarter reached $1.16 billion, up from $1.14 billion a year earlier and exceeding the analyst consensus of $1.06 billion by $0.10 billion, or 9.4%. Net revenue—excluding the recently cancelled USAID and Department of State work—was $1.07 billion, a 10.6% year‑over‑year increase that underscores the company’s ability to generate higher‑margin work in its core segments.
The earnings beat was largely driven by disciplined cost management and a favorable mix shift toward higher‑margin consulting projects in resilient water management and digital water automation. These services, which command premium pricing, helped offset modest cost inflation in support functions and contributed to the company’s operating income expansion.
Management raised its fiscal 2026 outlook, projecting net revenue between $4.05 billion and $4.25 billion and adjusted EPS between $1.40 and $1.55. For the first quarter of fiscal 2026, the company expects net revenue of $950 million to $1.0 billion and EPS of $0.30 to $0.33, signaling confidence that demand for its specialized services will remain strong and that cost controls will continue to support profitability.
The company also increased its quarterly dividend by 12% to $0.065 per share, payable December 12, 2025, and repurchased $50 million of common stock in the fourth quarter. As of September 28, 2025, $598 million remains available under approved share‑repurchase programs, reflecting a continued commitment to returning capital to shareholders.
After the earnings release, the market reaction was mixed: an initial after‑hours dip of about 1.3% was followed by an 11% jump on November 13, driven by the earnings beat, record results, and raised guidance. The volatility reflects profit‑taking by some investors and the positive sentiment generated by the company’s strong performance and dividend increase.
Dan Batrack, Chairman and CEO, said the quarter “resulted in record net revenue, record operating income, and significant operating margin expansion, driven by the continued strong demand for our differentiated high‑end consulting services in resilient water management and digital water automation.” He added that the company’s strategy of focusing on essential water and environmental services has allowed it to navigate recent changes in U.S. federal government priorities while achieving record financial performance for 2025.
These results position Tetra Tech to capitalize on growing demand for water and environmental solutions, while the raised guidance and shareholder‑return initiatives signal management’s confidence in sustained growth and profitability moving forward.
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