Dycom Q1 2026 slides: Revenue jumps 10.2%, company raises full-year outlook

Introduction & Market Context

Dycom Industries Inc . (NYSE:DY) reported strong first-quarter fiscal 2026 results on May 21, 2025, exceeding expectations and raising its full-year revenue outlook. The telecommunications infrastructure company’s shares jumped 4.75% in premarket trading to $202.82, building on the stock’s 0.78% gain the previous day.

The results reflect continued robust demand for telecommunications infrastructure services, particularly in fiber deployments and data center connectivity, as the digital infrastructure buildout continues across the United States.

Quarterly Performance Highlights

Dycom reported total contract revenues of $1.258 billion for Q1 2026, representing a 10.2% increase compared to $1.142 billion in the same period last year. While headline growth was impressive, organic revenue growth was more modest at 0.7%, with acquisitions contributing significantly to the overall revenue increase.

As shown in the following financial highlights:

Adjusted EBITDA rose to $150.4 million, a 14.9% increase from $130.9 million in Q1 2025. The company’s adjusted EBITDA margin improved by 49 basis points to 11.9%, demonstrating enhanced operational efficiency. However, adjusted diluted earnings per share slightly declined to $2.09 from $2.12 in the prior year.

The Q1 results significantly exceeded the guidance provided during Dycom’s Q4 FY2025 earnings call, where the company had projected revenue between $1.16 billion and $1.2 billion and adjusted EBITDA between $130.6 million and $140.6 million.

Backlog and Industry Outlook

A key indicator of Dycom’s future performance is its growing backlog, which reached $8.127 billion at the end of Q1 2026, with $4.685 billion expected to be completed within the next 12 months. This represents continued growth over five consecutive quarters, suggesting sustained demand for the company’s services.

The following chart illustrates this positive trend:

Dycom’s employee headcount remained relatively stable at 15,708, indicating the company is maintaining its workforce capacity to handle the growing backlog.

The company identified several industry growth drivers supporting its business, including multi-year capital commitments for fiber-to-the-home deployments, increasing demand for fiber infrastructure to support AI-enabled data center growth, continued state and federal program spending to bridge the digital divide, wireless network modernization, and expansion of core maintenance operations.

Financial Position

While Dycom’s operational performance was strong, its financial position showed some areas of concern. The company’s debt increased to $1.039 billion at the end of Q1 2026, up from $950.0 million in Q4 2025, while cash and equivalents decreased to $16.1 million from $92.7 million.

The debt and liquidity overview reveals:

Operating cash flow was negative at -$54.0 million, compared to -$37.4 million in Q1 2025. Capital expenditures more than doubled to $68.6 million from $29.3 million, reflecting increased investments in growth initiatives. The company also repurchased $30.2 million of common stock during the quarter.

Days Sales Outstanding (DSO) improved slightly to 111 days from 114 days in the previous quarter, but remains elevated, impacting working capital requirements.

Forward Guidance

Based on its strong Q1 performance, Dycom raised its full-year fiscal 2026 revenue outlook. The company now expects total contract revenues to range from $5.290 billion to $5.425 billion, representing growth of 12.5% to 15.4% over fiscal 2025. This is an increase from the previous guidance of 10.0% to 13.0% growth.

The updated outlook is detailed here:

For the second quarter of fiscal 2026, Dycom provided the following guidance:

The Q2 outlook projects continued strong performance with revenues between $1.38 billion and $1.43 billion, adjusted EBITDA between $185 million and $200 million, and diluted EPS between $2.74 and $3.05.

It’s worth noting that fiscal 2026 will include 53 weeks of operations, impacting seasonality. Additionally, the company’s outlook does not include potential storm restoration services, which contributed $114.2 million to fiscal 2025 results.

Non-GAAP Reconciliation

To provide a clearer picture of its operational performance, Dycom presented reconciliations of its non-GAAP financial measures, showing how organic growth and adjusted EBITDA are calculated:

The reconciliation highlights that while reported revenue growth was 10.2%, organic growth was just 0.7% after accounting for acquired businesses. This indicates that acquisitions played a significant role in the company’s overall growth during the quarter.

President and CEO Dan Peyovich expressed satisfaction with the results, noting the "strong start to fiscal 2026" and the company’s increased full-year revenue outlook, positioning Dycom to capitalize on the ongoing expansion of telecommunications and digital infrastructure across the United States.

Full presentation:

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