Dive Brief:
- Infrastructure activity remains strong in the U.S., especially in sectors such as transportation, water and energy, said Jacobs Solutions CEO Bob Pragada during the company’s fiscal second quarter earnings call.
- Pragada still expects initiatives, such as the Infrastructure Investment and Jobs Act, to drive substantial investments in transportation infrastructure that will likely ramp up significantly in 2026 and 2027.
- In addition to these sectors, Pragada said the semiconductor and data center construction industries are experiencing robust growth, fueled by increasing demand for processing power and storage.
Dive Insight:
The ongoing emphasis on the transportation, water and energy sectors underscores the continued commitment to bolstering the United States’ critical infrastructure. Pragada highlighted Jacobs’ proactive stance in pursuing these projects.
Bob Pragada
Courtesy of Jacobs
“Water remains a critical group catalyst with several strategic wins across our key geographies, further bolstering our position in the sector,” said Pragada during the call. “And if you look at the pipeline, the infrastructure component of it, in transportation — whether it be in aviation or in rail, the opportunities that we’ve had have been pretty robust.”
Takeaways from earnings
Jacobs reported it earned $162.11 million for its second quarter 2024, which ended March 29, marking a 25.1% drop from $216.51 million in profits a year ago. Its revenue for the quarter reached $4.27 billion, a 4.7% uptick from $4.08 billion in last year’s second quarter, according to the company’s earnings report.
The Dallas-based company’s backlog reached $29.41 billion, a 1.4% jump from $29 billion from last year’s second quarter.
“We think Jacobs delivered solid second quarter results driven by a strong contribution from its People & Places Solution segment,” said Faisal Hersi, equity analyst with financial services firm Edward Jones in a research note. “We think Jacobs remains well positioned to benefit from continued U.S. and international infrastructure-spending increases.”
For example, Jacobs, along with two other firms, recently won a contract worth up to $45 million to design upgrades of wastewater treatment plants for the Miami-Dade County Water and Sewer Department in Florida. Additionally, the Dallas-based company also recently won a contract, in a joint venture with AECOM, to serve as the delivery partner on the $6 billion Frederick Douglass Tunnel Program in Baltimore.
Pragada added the burgeoning semiconductor and data center construction industries as a growing area of opportunity, especially as projects begin to ramp up the second stages of these projects.
“A lot of stuff in the news right now about the ubiquitous world of chip manufacturing and how AI is driving, not just chip manufacturing, but also data centers,” said Pragada during the call. “The CHIPS Act money has now been delivered to the market and some of the largest players have benefited from that. We’re seeing projects that we’ve already been involved with, talk about phase two of those. We’ll have more to say as those become public in the second half.”
