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BOCA RATON, Fla. - The GEO Group, Inc. (NYSE:GEO) reported first-quarter 2025 results that fell short of analyst expectations and lowered its full-year guidance, signaling potential challenges ahead for the secure facilities and reentry services provider.
GEO reported adjusted earnings per share of $0.14 for the first quarter, missing the analyst consensus of $0.19. Revenue came in at $604.6 million, below the $611.81 million estimate and down slightly from $605.7 million in the same quarter last year.
The company’s Adjusted EBITDA declined to $99.8 million from $117.6 million in Q1 2024. GEO attributed the weaker results partly to a $5 million increase in general and administrative expenses related to a management reorganization, as well as $6 million in higher payroll taxes compared to the previous quarter.
Looking ahead, GEO significantly reduced its full-year 2025 outlook. The company now expects earnings per share of $0.77 to $0.89, well below the previous analyst consensus of $1.31. Revenue guidance was set at $2.53 billion, also falling short of the $2.663 billion consensus estimate.
Despite the soft results, GEO’s Executive Chairman George C. Zoley expressed optimism about future growth opportunities, particularly in assisting the federal government with immigration enforcement. The company announced two contract awards in Q1 for reactivating facilities, which are expected to generate over $130 million in annualized revenues.
"We have taken several important steps to be prepared to meet that opportunity, including making a significant investment commitment of $70 million to strengthen our capabilities," Zoley stated.
GEO expects its financial performance to improve in the second half of 2025 as new projects come online. The company also aims to reduce its total net debt by $150 million to $175 million this year, bringing it to approximately $1.54 billion.
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