Quanta Services Q3 2026: revenue up 57% to $12.0B, EPS doubled to $4.55, backlog a record $63.7B

Quanta Services builds and maintains the physical equipment of the power grid (transmission lines, substations, the electrical work inside power plants and data centers) plus gas, pipeline and industrial infrastructure. In the third quarter of 2026 (the three months to September 30) revenue rose 57% to $12.01 billion, diluted EPS roughly doubled to $4.55, and total backlog reached a record $63.7 billion. For the third quarter in a row, management raised every line of its full-year outlook.

Results at a glance

Operating margin is the share of revenue left after running the business, before interest and tax. Free cash flow is operating cash flow minus net capital spending ($254.4M this quarter). Adjusted EPS and adjusted EBITDA are Quanta's own measures (see below for what they leave out).

Where the growth came from

Electric (82% of revenue) grew $3.63B. The 10-Q credits "increased demand for our services" plus about $1.22B of revenue from acquired businesses, so excluding acquisitions the segment grew roughly 39%. The filing ties the demand to utilities spending on grid modernization, storm hardening and new transmission and substation capacity, "driven by increasing demand for electricity associated with, among other things, data centers," plus reshoring of manufacturing. Operating income rose 76% to $1.24B, and the filing puts the margin gain down to higher revenue and "improved execution across our electric and power generation services."

Underground and Infrastructure (gas utility, pipeline and industrial work) grew $756M, of which about $335M came from acquired businesses, so roughly 29% without them. That is much stronger than in the first half. On a nine-month basis the filing attributes the segment's whole revenue increase "primarily" to $1.02B from acquisitions. Its margin rose a point to 9.4%, which the 10-Q credits to acquired mechanical-services businesses spreading the segment's fixed costs over more revenue.

Corporate costs rose $111M, mostly because of $55.4M more amortization of acquired intangibles and higher stock-based pay. Those are the costs of Quanta's buy-and-build strategy.

Backlog: the number that matters most for a contractor

Backlog is the value of work customers have committed to that hasn't yet been done and billed. For a contractor, it is the best guide to future revenue.

Total backlog grew another $10.3B in the quarter, from $53.4B at June 30. The firmer part, remaining performance obligations (RPO: signed fixed-price and similar contracts, as opposed to estimated future orders under long-running maintenance agreements), more or less doubled from a year ago. The 10-Q says the increase since December came "partially" from new awards and more volume with existing customers and "to a lesser extent" from acquisitions, without giving a dollar split. The two businesses bought in September and October were small (about 590 employees between them), so most of this quarter's $10.3B jump was won, not bought.

What the headline numbers hide

• EPS growth is real profit growth. Pre-tax income rose 104% ($944.6M vs $462.4M), in line with EPS. The tax rate barely moved (25.2% vs 25.9%), Quanta bought back no shares in 2026, and the diluted share count rose 0.8%. A $4.5M tax-reserve release is too small to matter.
• Part of the growth was bought. About $1.56B of the $4.38B revenue increase came from acquired businesses, so growth without acquisitions was closer to 37% than 57%. Still exceptional for a contractor of this size, but investors comparing it with peers should use the smaller number.
• The adjusted EPS figure excludes recurring costs. Adjusted EPS ($6.06) is $1.51 above GAAP. Most of the gap is $188.6M of intangible amortization ($1.24 a share before tax) and $67.9M of stock-based pay ($0.44). Both recur every quarter while Quanta keeps buying companies and paying people in stock. GAAP EPS actually grew faster (+103% vs +82%) because those add-backs were proportionally larger a year ago.
• Cash flow is strong, but customers are financing part of it. Operating cash flow of $1.45B was about twice net income. Over nine months, contract liabilities (customers paying in advance of the work) rose $1.98B. The filing attributes this "primarily" to "favorable billing terms on certain large projects," and that cash reverses once the work is done. Days sales outstanding (how long revenue takes to turn into cash) fell to 50 from 66 a year ago. Receivables rose 48% since December, against 57% revenue growth, so there is no sign of collection problems.
• Debt rose to fund the deals. Quanta issued $2.0B of senior notes in August and prepaid its $619M term loan. Long-term debt is $6.35B, up from $5.23B in December, and cash is $2.32B. Cash returned to shareholders was small: $17.2M of dividends in the quarter ($0.11 a share) and no buybacks, though a new $1.0B repurchase program authorized in May is untouched.

On balance the quarter is clean. Reported EPS growth matches pre-tax profit growth, with no help from taxes, buybacks or one-off gains. The caveats are that roughly a third of the revenue growth was acquired and that advance billings are flattering cash flow, not earnings.

Did last time's read hold up?

Our Q2 2026 report named three things to watch. (1) Whether Electric margins would hold as acquired companies were folded in: they did and then some, rising to 12.6% from 11.5% in Q2. (2) How much of the next backlog increase would be organic: the filing gives no split, but this quarter's $10.3B rise came with only two small acquisitions, so most of it was won. (3) Whether the advance-billing boost to cash flow would start to unwind: not yet, because contract liabilities kept rising, to $5.54B from $3.26B in December.

Takeaway: Quanta's existing business, not its acquisitions, is now doing most of the work. Revenue grew about 37% without acquired companies, the Electric margin widened by more than a point, and signed contracts doubled to $41.8B. The one figure to read with care is cash flow, which customers' advance payments are inflating for now.

Outlook

Quanta raised its full-year 2026 guidance again:

Nine-month revenue was $29.45B, so the new range implies $11.85–12.15B in the fourth quarter, about the same as Q3. It also implies adjusted EPS of $4.92–5.32 for Q4, below Q3's $6.06. Fourth quarters are usually seasonally softer for outdoor construction, so the guide looks conservative rather than a sign of slowing. The two small acquisitions closed in September and October aren't expected to contribute materially to 2026. CEO Duke Austin said there is "opportunity to deliver strong double-digit adjusted EPS growth in 2027, supported by continued backlog growth."

Our read: with $38.4B of backlog due to be worked off within 12 months, more than three quarters at the current revenue rate, 2027 revenue is largely spoken for. The risks are in execution (labor supply, permitting, supply chain, which the filing lists) and in the balance sheet carrying more debt after the acquisitions. Things to watch at Q4: (1) whether the Electric margin stays above 12% outside peak season, (2) whether contract liabilities start to fall and pull cash flow back toward net income, and (3) whether RPO keeps rising faster than total backlog. That would mean more of the pipeline is moving from estimated orders to signed contracts.