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- Revenue $1.37 billion and Net Revenue $1.15 billion
- Net Revenue of $1.06 billion, up 11% Y/Y excluding USAID and DOS
- Operating Income $165 million, up 28% Y/Y
- EPS $0.43, up 34% Y/Y
- Operating Cash Flow $350 million, up 148% Y/Y
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PASADENA, Calif. — Tetra Tech, Inc. (NASDAQ: TTEK), a leading provider of high-end consulting and engineering services in water, environment and sustainable infrastructure, today announced results for the third quarter ended June 29, 2025.
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$ million (except EPS data) | Q3 FY25 | YTD FY25 | ||||||||||
Reported | Excluding | Adjusted1 | Excluding | |||||||||
Revenue | $ | 1,370 | $ | 1,264 | $ | 4,112 | $ | 3,560 | ||||
Net Revenue1 | $ | 1,153 | $ | 1,062 | $ | 3,454 | $ | 2,990 | ||||
Operating Income | $ | 165 | $ | 159 | $ | 432 | $ | 396 | ||||
EPS | $ | 0.43 | $ | 0.41 | $ | 1.11 | $ | 1.01 | ||||
Backlog | $ | 4,277 | $ | 4,149 | $ | 4,277 | $ | 4,149 | ||||
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Third Quarter Highlights (Excluding USAID and DOS)
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- Revenue increased 10% Y/Y to $1.26 billion
- Net Revenue increased 11% Y/Y to $1.06 billion
- Operating Income increased 37% Y/Y to $159 million
- EPS increased 46% Y/Y to $0.41
- Backlog $4.15 billion, up Y/Y and sequentially
- Days sales outstanding: 54 days
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Year to Date Highlights (Excluding USAID and DOS)
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- Revenue increased 10% Y/Y to $3.56 billion
- Net Revenue increased 10% Y/Y to $2.99 billion
- Adjusted Operating Income increased 24% Y/Y to $396 million
- Adjusted EPS increased 31% Y/Y to $1.01
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Recent Key Wins
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- $990 million multiple-award contract for engineering design for NAVFAC Pacific
- $249 million multiple-award contract for energy resilience for USACE Huntsville District
- $248 million multiple-award contract for planning and engineering services for USACE Europe District
- $190 million multiple-award contract for planning and engineering services for USACE Honolulu District
- $94 million single-award contract for emergency preparedness and response services for U.S. EPA
- $45 million multiple-award contract for environmental services for U.S. Department of the Interior
- $22 million single-award contract for disaster recovery services for the State of Georgia
- $10 million single-award contract for water digital automation systems for Los Angeles County
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Quarterly Dividend and Share Repurchase Program
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On July 28, 2025, Tetra Tech’s Board of Directors approved the Company’s 45th consecutive quarterly dividend at an amount of $0.065 per share, a 12% increase year-over-year, payable on August 29, 2025, to stockholders of record as of August 15, 2025. In the third quarter, Tetra Tech repurchased $25 million of common stock. Additionally, as of June 29, 2025, the Company had $648 million remaining under the approved share repurchase programs.
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Chairman and CEO Comments
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Dan Batrack, Chairman and CEO, commented, “Tetra Tech delivered another strong quarter with increasing revenue, record operating income, and significant operating margin expansion over the third quarter of last year. This performance is being driven by our high-end water, environmental and sustainable infrastructure services, which includes our clients’ increased funding for preparing and responding to natural disasters. Although the financial results for fiscal 2025 to date have exceeded our initial expectations, we are continuing to navigate the near-term financial impacts from the changes in U.S. federal government priorities and the related secondary impacts to our end markets.”
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Business Outlook
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The following statements are based on current expectations. These statements are forward-looking, and the actual results could differ materially. These statements do not include the potential impact of transactions that may be completed or developments that become evident after the date of this release. The Business Outlook section should be read in conjunction with the information on forward-looking statements at the end of this release.
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For fiscal 2025, Tetra Tech expects net revenue2 to range from $4.454 billion to $4.554 billion and adjusted EPS3 guidance to range from $1.49 to $1.54. For the fourth quarter of fiscal 2025, Tetra Tech expects net revenue to range from $1.0 billion to $1.1 billion and EPS to range from $0.38 to $0.43.
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Webcast
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Investors will have the opportunity to access a live audio-visual webcast and supplemental financial information concerning the third quarter of fiscal 2025 results through a link posted on the Company’s website at tetratech.com on July 31, 2025, at 8:00 a.m. (PT).
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| __________________ | ||
1 | Non-GAAP financial measures which the Company believes provide valuable perspectives on its business results. The reported adjusted operating income and EPS exclude non-cash goodwill impairment related to USAID in Q2-25 and legal contingency in Q1-25. Refer to tables at the end of the release and Regulation G Information for reconciliations to the comparable GAAP metrics. | |
2 | Reconciliation of the net revenue guidance to the most directly comparable GAAP measure is not available without unreasonable efforts because the Company cannot predict the magnitude and timing of all the components, including subcontractor costs, required to provide such reconciliation with sufficient precision. | |
3 | The adjustments in our guidance for EPS exclude legal contingency of $0.35 in Q1-25 and goodwill impairment of $0.31 in Q2-25. | |
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Reconciliation of GAAP and Non-GAAP Items In thousands (except EPS data) | |||||||||||||||
Three Months Ended | Nine Months Ended | ||||||||||||||
June 29, | June 30, | June 29, | June 30, | ||||||||||||
Revenue | $ | 1,369,816 | $ | 1,344,323 | $ | 4,112,490 | $ | 3,824,205 | |||||||
USAID / DOS | (106,084 | ) | (194,753 | ) | (552,572 | ) | (577,762 | ) | |||||||
Revenue excl. USAID / DOS | $ | 1,263,732 | $ | 1,149,570 | $ | 3,559,918 | $ | 3,246,443 | |||||||
Revenue | $ | 1,369,816 | $ | 1,344,323 | $ | 4,112,490 | $ | 3,824,205 | |||||||
Subcontractor costs | (216,800 | ) | (234,742 | ) | (658,439 | ) | (646,828 | ) | |||||||
Net revenue | $ | 1,153,016 | $ | 1,109,581 | $ | 3,454,051 | $ | 3,177,377 | |||||||
USAID / DOS | (91,305 | ) | (154,503 | ) | (464,104 | ) | (470,294 | ) | |||||||
Net revenue excl. USAID / DOS | $ | 1,061,711 | $ | 955,078 | $ | 2,989,947 | $ | 2,707,083 | |||||||
Operating Income | $ | 164,986 | $ | 128,630 | $ | 227,114 | $ | 357,395 | |||||||
Legal contingency | – | – | 115,000 | – | |||||||||||
Goodwill impairment | – | – | 92,416 | – | |||||||||||
Contingent consideration | (58 | ) | 500 | (2,355 | ) | 477 | |||||||||
Adjusted Operating Income | $ | 164,928 | $ | 129,130 | $ | 432,175 | $ | 357,872 | |||||||
USAID / DOS | (5,492 | ) | (12,918 | ) | (36,638 | ) | (39,434 | ) | |||||||
Adjusted OI excl. USAID / DOS | $ | 159,436 | $ | 116,212 | $ | 395,537 | $ | 318,438 | |||||||
EPS | $ | 0.43 | $ | 0.32 | $ | 0.45 | $ | 0.88 | |||||||
Legal contingency | – | – | 0.35 | – | |||||||||||
Goodwill impairment | – | – | 0.31 | – | |||||||||||
Adjusted EPS | $ | 0.43 | $ | 0.32 | $ | 1.11 | $ | 0.88 | |||||||
USAID / DOS | (0.02 | ) | (0.04 | ) | (0.10 | ) | (0.11 | ) | |||||||
Adj. EPS excl. USAID / DOS | $ | 0.41 | $ | 0.28 | $ | 1.01 | $ | 0.77 | |||||||
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