Q2 2026 Quanta Services Inc Earnings Call

Speaker #1: Into the Quanta Services Q2 2026 earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow management's prepared remarks, and we will ask that you please hold all questions until that time.

Speaker #1: I will then provide instructions for the question and answer session. As a reminder, this conference is being recorded. If you have any objection, please disconnect at this time.

Speaker #1: I will now turn the call over to Kip Rupp, Vice President Investor Relations for introductory remarks.

Speaker #2: Thank you, and welcome everyone to the Quanta Services Q2 2026 earnings conference call. This morning wish you to press release announcing our Q2 2026 results, which can be found in the Investor Relations section of our website, at quantaservices.com.

Speaker #2: This morning we also posted our Q2 2026 operational and financial commentary in our 2026 Outlook Expectations Summary on Quanta's Investor Relations website. While management will make brief introductory remarks during this morning's call, the operational and financial commentary is intended to largely replace management's prepared remarks, allowing additional time for questions from the institutional investment community.

Speaker #2: Please remember that information reported on this call speaks only as of today, July 30, 2026, and therefore you are advised that any time-sensitive information may no longer be accurate as of any replay of this call.

Speaker #2: This call will include forward-looking statements intended to qualify under the Safe Harbor from Liability established by the Private Securities Litigation Reform Act of 1995, including statements reflecting expectations, intentions, assumptions, or beliefs about future events or financial performance.

Speaker #1: remarks.

Speaker #2: You should not place undue reliance on these statements, as they involve certain risks, uncertainties, and assumptions that are difficult to predict or beyond Quanta's control, and actual results may differ materially from those expressed or implied.

Speaker #2: you to press release announcing our second quarter the Investor Relations section of our website, at quantaservices.com. This morning we also posted our second quarter 2026 operational and financial commentary in our 2026 Outlook Expectations Summary on Quanta's investor relations website. brief introductory remarks during this morning's call, the operational and financial commentary is intended to largely replace management's prepared remarks, allowing additional time for questions from the institutional investment community. you, and welcome everyone to the QUANTA SERVICES second quarter 2026 earnings conference call. information reported on this call speaks only as of today, July 30, 2026, and therefore you are advised that any time-sensitive information may no longer be accurate as of any replay of this call.

Speaker #2: We will also present certain historical and forecasted non-GAAP financial measures, reconciliations of these financial measures to their most directly comparable GAAP financial measures are included in our earnings release, and operational and financial commentary.

Speaker #2: Please refer to these statements for additional information regarding our forward-looking statements and non-GAAP financial measures. Lastly, please sign up for email alerts through the Investor Relations section of Quanta Services.com to receive.

Speaker #2: community. Please remember that relations website. While management will make earnings conference call. This morning wish This call will include forward-looking statements intended to qualify under the Safe Harbor from Liability established by the Private Securities Litigation Reform Act of 1995, including statements reflecting expectations, intentions, assumptions, or beliefs about future events or financial performance.

Speaker #2: Of news releases and other information to follow Quanta IR and Quanta Services on the social media channels listed on our website. With that, I would like to now turn the call over to Mr. Duke Austin, Quanta's President and CEO.

Speaker #2: Duke?

Speaker #3: Thanks, Kip. Good morning, everyone, and welcome to the Quanta Services Q2 2026 earnings conference call. I want to begin by recognizing our people in the field.

Speaker #3: Everything we are about to discuss starts with our more than 85,000 employees, and the execution they deliver for our customers safely, on time, and on budget every day.

Speaker #2: You should not place undue reliance on these statements, as they involve certain risks, uncertainties, and assumptions that are difficult to predict or beyond Quanta's control, and ask for results made different materially from those expressed or implied.

Speaker #3: This morning we reported Q2 results that meaningfully exceeded expectations, with strong double-digit growth in revenues adjusted EBITDA, and adjusted earnings per share robust cash flow and record backlog of $53 billion.

Speaker #2: We will also present certain historical and forecasted non-GAAP financial measures, reconciliations of these financial measures to their most directly comparable GAAP financial measures are included in our earnings release, and operational and financial commentary.

Speaker #2: Please refer to these statements for additional information regarding our forward-looking statements and non-GAAP financial measures. Lastly, please sign up for email alerts through the Investor Relations section of quantaservices.com to receive notifications of news releases and other information to follow Quanta IR and Quanta Services on the social media channels listed on our website.

Speaker #3: Given when these acquisitions closed, their contribution to the quarter was minimal. The strength you're seeing today reflects broad-based organic strength across our segments, service lines, and end markets, and the successful execution of our strategy in the investments we have made against it.

Speaker #3: During this Q2 in July, we completed the acquisitions of Falcone, Enterfab, Perseron, and PSD, and we welcome each of these excellent companies and their employees to the Quanta family.

Speaker #2: With that, I would like to now turn the call over to Mr. Duke Austin, Quanta's President and CEO. Duke?

Speaker #3: Thanks, Kip. Good morning, everyone, and welcome to the Quanta Services second quarter 2026 earnings conference call. I want to begin by recognizing our people in the field.

Speaker #3: These acquisitions enhance our geographic presence and continue our strategy to scale self-perform, cross-skill capabilities across electrical, mechanical, civil, and fabrication, and to lean into the front end of our customers' programs.

Speaker #3: Everything we are about to discuss starts with our more than 85,000 employees, and the execution they deliver for our customers safely, on time, and on budget every day.

Speaker #3: Where the work takes shape, and where getting involved early maximizes the value we can deliver. These are companies that have executed successfully for decades, and whose owners and leadership came up through the craft, with customer relationships often built over generations.

Speaker #3: This morning we reported second quarter results that meaningfully exceeded expectations, with strong double-digit growth in revenues, adjusted EBITDA, and adjusted earnings per share, robust cash flow, and record backlog of 53 billion.

Speaker #3: These acquisitions strengthen our position in technology and load centers, while adding meaningfully diversification across end markets we've served for decades. Quanta runs on a culture of absolute performance, and is dedicated to the continuous improvement and the success of our customers.

Speaker #3: Given when these acquisitions closed, their contribution to the quarter was minimal. The strength you're seeing today reflects broad-based organic strength across our segments, service lines, and end markets, and the successful execution of our strategy and the investments we have made against it.

Speaker #3: Every acquisition has to fit our strategy, and the culture has to fit. That is the first thing we evaluate and something we do not compromise.

Speaker #3: During this second quarter, in July, we completed the acquisitions of Falcon, Enterfab, Percheron, and PSD, and we welcome each of these excellent companies and their employees to the Quanta family.

Speaker #3: When a company that has built its name over 50 or 100 years decides to join Quanta, they are choosing a home that protects their legacy, keeps their management team, and gives the people more opportunity than they could create alone.

Speaker #3: These acquisitions enhance our geographic presence and continue our strategy to scale self-perform, cross-skill capabilities across electrical, mechanical, civil, and fabrication, and to lean into the front end of our customers' programs.

Speaker #3: Our solutions-based model is performing well, creating markets and unlocking growth opportunities because it is a platform that brings our customers' industry-leading capabilities, scope and scale, with the largest craft workforce in North America at the center.

Speaker #3: Where the work takes shape, and where getting involved early maximizes the value we can deliver. These are companies that have executed successfully for decades, and whose owners and leadership came up through the craft, with customer relationships often built over generations.

Speaker #3: The rigor we built over decades serving utilities, the planning, the safety, and the programmatic exactly what we are bringing to technology and load center, and generation markets.

Speaker #3: These acquisitions strengthen our position in technology and load centers, while adding meaningfully diversification across end markets we've served for decades. Quanta runs on a culture of absolute performance, and is dedicated to the continuous improvement and the success of our customers.

Speaker #3: Technology is trying to move as fast as possible, utilities are working to protect the rate payer, and Quanta sits in the middle of the nexus.

Speaker #3: Providing solutions to both. Our customers realize how important speed and certainty is, and the trust and track record we have built over decades is what differentiates Quanta.

Speaker #3: Every acquisition has to fit our strategy, and the culture has to fit. That is the first thing we evaluate and something we do not compromise.

Speaker #3: Quanta's core strategy remains grounded in craft-skilled labor, execution certainty, and disciplined capital deployment. Craft is built over time, and we prioritize that investment for well over a decade.

Speaker #3: When a company that has built its name over 50 or 100 years decides to join Quanta, they are choosing a home that protects their legacy, keeps their management team, and gives the people more opportunity than they could create alone.

Speaker #3: We self-perform 80 to 85 percent of our work, which is what allows us to deliver on time and on budget at scale. That certainty, quarter after quarter and year after year, is what our customers count on.

Speaker #3: Our solutions-based model is performing well, creating markets and unlocking growth opportunities because it is a platform that brings our customers' industry-leading capabilities, scope and scale, with the largest craft workforce in North America at the center.

Speaker #3: It is what has produced record-adjusted EPS for the last 9 consecutive years, and why our customers keep asking us to do more. As a result of our strong first half, improved visibility into the remainder of the year, and expected contributions from the acquisitions announced this morning, we are significantly increasing our full-year 2026 financial expectations across all metrics.

Speaker #3: The rigor we built over decades serving utilities, the planning, the safety, and the programmatic execution is exactly what we are bringing to technology and load center, and generation markets.

Speaker #3: Technology is trying to move as fast as possible, utilities are working to protect the rate payer, and Quanta sits in the middle of the nexus.

Speaker #3: The record backlog we reported reflects the demand in front of us, but we're still in the early stages. The larger programs across the utility generation and technology load center markets are ahead of us, and we expect them to stack in the years to come.

Speaker #3: Providing solutions to both. Our customers realize how important speed and certainty is, and the trust and track record we have built over decades is what differentiates Quanta.

Speaker #3: In many ways, we're just getting started. We remain focused on executing for our customers' success, deploying capital with discipline, and compounding earnings and shareholder value over the long term.

Speaker #3: Quanta's core strategy remains grounded in craft-skilled labor, execution certainty, and disciplined capital deployment. Craft is built over time, and we prioritize that investment for well over a decade.

Speaker #3: I will now turn the call over to Jashree Desai, Quanta CFO, to provide a few remarks about our results and 2026 guidance, and then we will take your questions.

Speaker #3: We self-perform 80 to 85 percent of our work, which is what and on budget at scale. That certainty, quarter after quarter and year after year, is what our customers count on.

Speaker #3: Jashree?

Speaker #4: Thanks, Duke, and good morning, everyone. This morning we reported historically strong Q2 results, with revenues of $9.6 billion, net income attributable to common stock of $451 million, or $2.96 per diluted share, adjusted diluted earnings per share of $4.24, and adjusted EBITDA of $1.1 billion.

Speaker #3: It is is what has produced record-adjusted EPS for the last nine consecutive years, and why our customers keep asking us to do more. As a result of our strong first half, improved visibility into the remainder of the year, and expected contributions from the acquisitions announced this morning, we are significantly increasing our full-year 2026 financial expectations across all metrics.

Speaker #4: Those results included approximately $11 million of adjusted EBITDA from acquisitions made during the Q2. The performance in the first half of 2026 exceeded our initial expectations, led by the strength of our end markets and our strategies and action.

Speaker #3: The record backlog we reported reflects the demand in front of us, but we're still in the early stages. The larger programs across the utility generation and technology load center markets are ahead of us, and we expect them to stack in the years to come.

Speaker #4: Diversity of our workforce and our customer-centric delivery model are translating to greater scope, better resource utilization, elevated revenues, and improved margins. And our customers are increasingly recognizing how the breadth of our capabilities can contribute to their success, as evidenced by another quarter of record backlogs.

Speaker #3: In many ways, we're just getting started. We remain focused on executing for our customers' success, deploying capital with discipline, and compounding earnings and shareholder value over the long term.

Speaker #3: I will now turn the call over to Jayshree Desai, Quanta CFO, to provide a few remarks about our results and 2026 guidance, and then we will take your questions.

Speaker #4: Given the strength of our first half performance, improved visibility into the second half, and expected contributions from recent acquisitions, we are raising our full-year financial expectations.

Speaker #3: Jayshree?

Speaker #4: Thanks, Duke, and good morning, everyone. This morning we reported historically strong second quarter results, with revenues of 9.6 billion dollars, net income attributable to common stock of 451 million dollars, or $2.96 per diluted share, adjusted diluted earnings per share of $4.24, and adjusted EBITDA of 1.1 billion dollars.

Speaker #4: We now expect revenues to range between $39.3 and $39.7 billion, adjusted EBITDA to range between $4.1 and $4.2 billion, adjusted EPS to range between $16.45 and $16.95, and free cash flow to range between $2 and $2.5 billion.

Speaker #4: As Duke described, subsequent to our first quarter earnings release, we acquired 4 companies for approximately $1.24 billion of upfront consideration, net of cash acquired.

Speaker #4: Those results included approximately 11 million dollars of adjusted EBITDA from acquisitions made during the second quarter. The performance in the first half of 2026 exceeded our initial expectations, led by the strength of our end markets and our strategies and action.

Speaker #4: Plus approximately $242 million of contingent consideration, that can be earned based on financial performance in the years following the closing. Included within our increased full-year financial expectations are $1.2 to $1.4 billion of revenues and $120 to $140 million of adjusted EBITDA from these acquisitions.

Speaker #4: The versatility of our workforce and our customer-centric delivery model are translating to greater scope, better resource utilization, elevated revenues, and improved margins. And our customers are increasingly recognizing how the breadth of our capabilities can contribute to their success, as evidenced by another quarter of record backlogs.

Speaker #4: Importantly, as evidenced by the ratings upgrade by Moody's, our balance sheet and credit profile strengthened, even as we deployed capital on the aforementioned acquisitions.

Speaker #4: Given the strength of our first half performance, improved visibility into the second half, and expected contributions from recent acquisitions, we are raising our full-year financial expectations.

Speaker #4: As calculated under our senior credit agreement, at the end of the second quarter, our debt-to-EBITDA ratio improved to 1.7, down from 1.95 at the end of 2025, and we had total liquidity of approximately $2.8 billion.

Speaker #4: We now expect revenues to range between 39.3 and 39.7 billion dollars, adjusted EBITDA to range between 4.1 and 4.2 billion dollars, adjusted EPS to range between $16.45 and $16.95, and free cash flow to range between 2 and 2.5 billion dollars.

Speaker #4: The larger programs, broader service offerings, and multi-year commitments we're negotiating every day are a direct reflection of the trust our customers place in our ability to execute at scale.

Speaker #4: Combined with the disciplined way we're allocating capital across our strategic initiatives, we believe we're well-positioned to keep converting that trust into durable, attractive returns for our shareholders.

Speaker #4: As Duke described, subsequent to our first quarter earnings release, we acquired four companies for approximately 1.24 billion dollars of upfront consideration, net of cash acquired.

Speaker #4: Plus approximately 242 million dollars of contingent consideration, that can be earned based on financial performance in the years following the closing. Included within our increased full-year financial expectations are 1.2 to 1.4 billion dollars of revenues and 120 to 140 million dollars of adjusted EBITDA from these acquisitions.

Speaker #4: Additional detail and commentary on our 2026 financial guidance can be found in our operational and financial commentary and outlook expectation summary. Both available on our investor relations website.

Speaker #4: With that, we're happy to take your questions.

Speaker #1: Thank you. We will now move to our question-and-answer session. For today's session, we'll be utilizing the raise-hand feature via the webinar. If you'd like to ask a question, simply click on the raise-hand button at the bottom of your screen.

Speaker #4: Importantly, as evidenced by the ratings upgrade by Moody's, our balance sheet and credit profile strengthened, even as we deployed capital on the aforementioned acquisitions.

Speaker #1: If you have dialed in, please press star 9 to raise hand and star 6 to unmute. Once you've been called on, please unmute yourself and begin to ask your question.

Speaker #4: As calculated under our senior credit agreement, at the end of the second quarter, our debt-to-EBITDA ratio improved to 1.7, down from 1.95 at the end of 2025, and we had total liquidity of approximately 2.8 billion dollars.

Speaker #1: Again, that is star 9 to raise hand and star 6 to unmute if you have dialed in. We ask. One question. If you have additional questions, you may re-queue, and those questions will be addressed time permitting.

Speaker #1: Thank you. We will now pause a moment to assemble the queue. Your first question comes from Stephen Fisher with UBS. Please unmute and ask your question.

Combined with the disciplined way, where allocating Capital across our strategic initiatives, we believe we're well positioned to keep converting that trust into durable, attractive returns for our shareholders.

Speaker #1: Steve, in your line is open. You may ask your question.

Speaker #5: How's it going?

Speaker #3: Can you hear me?

Additional detail and commentary on our 2026. Financial guidance can be found in our operational and financial commentary and Outlook expectations summary. Both available on our investor relations website with that. We're happy to take your questions.

Speaker #4: Yes. Now we can.

Speaker #3: Okay. Sorry about that. Yeah, just we're saying congrats on the strong beats across your business in the quarter. But maybe focusing on the strong margin performance.

Speaker #3: I know you've been Duke, a little bit reserved and Jashree on the margin upside messaging. I guess, to what extent do you now think you may be a little bit more positively longer term about the margin potential here at you have more self-perform and you've got more large load projects becoming more of the mix.

Thank you. You will now move to our question and answer session for today's session, we'll be utilizing the raise hand feature via the webinar if you'd like to ask a question, simply click on the raise hand button at the bottom of your screen. If you have dialed in, please press star 9 to raise hand and star 6 to unmute. Once you've been called on, please unmute yourself and begin to ask your question. Again, that is star 9 to raise hand and star 6 to unmute if you have dialed in.

Speaker #3: I guess, any reason why that wouldn't add to some margin upside over the longer term?

Speaker #5: Yeah, thanks, Steve. Thanks for the comments about the quarter. I think when we're looking at the margin profile, we said the UI segment had some room and we felt like it would move up.

We ask that all participants limit themselves to one question. Do you have additional questions? You may request, and those questions will be addressed, time permitting. Thank you. We will now pause a moment to assemble the queue.

Your first question comes from Stephen Fischer with UBS. Please unmute and ask your question.

Speaker #5: The businesses that we've acquired, how we look at that business today, the risk we're willing to take, certainly is moving that profile up and you're seeing that in the quarter.

Speaker #5: And I believe you'll see that on a go-forward basis. So that moved up. Electric as well. I think we moved that up as well in the backside.

Your line is open. You may ask your question.

Speaker #5: That looked structurally, fundamentally, the business has changed. We're seeing it change we have to addressable TAMs. Both of which are growing. So I do that mix we're looking at it constantly to make sure that we're giving you good, prudent guidance.

How's it going? Can you hear me? Yes, now we can.

Okay, sorry about that.

Speaker #5: Yeah, I do think we posted a real nice quarter. We were prudent in the guidance that we gave you in the back half. You're seeing synergies show up.

Yeah, just that thing. Um, congrats on the strong beat to cross your business in the quarter, uh, but maybe focusing on the, the strong margins performance. I know you've been Duke a little bit, you know, reserved and j3 on the March and upside.

Speaker #5: We're seeing a lot of book to burn. So I do believe there is some room in the margins in the backside. We took prudent approach to it.

Speaker #5: There's no you got climbs and northern climbs weather. We take everything into risk. Project slips, all that's already baked into our numbers. So yeah, I think there's upside in the back.

Messaging, I guess to what extent do you now think you may be a little bit more positive longer term about the margin potential here? You have more self-perform and you've got more large load projects becoming more of the mix. I guess, any reason why that wouldn't add to some margin upside over the longer term?

Yeah. Thanks Steve. Thanks for the comments about the quarter.

Speaker #5: And as we see it, as we see the work mix, as we see the mix in the electric segment, it's a big segment. So we have to really take into account everything in there.

Speaker #5: And I think we've done a nice job of that. But I do think there's room for margin improvement in the backside. We've always said that the electric segment has the ability to operate 10 to 12 on the utility side.

Speaker #5: 12 would be the utmost margins that you would see. And that's when you stacked in large transmission and all aspects. At once. So you get full utilizations you're also training a lot of people.

I think when we when we're looking at the the margin profile, we said that UI segment, had some room and we we felt like it would move up, you know, the the businesses that we've acquired how we how we look at that business today. The risk we're willing to take, you know, certainly is moving that profile up and you're seeing that in the quarter and I believe you'll see that going to go for basis. Um you know, so that moved up electric as well. I think we moved that up as well on the back side. Um,

Speaker #5: I mean, we've added 15,000, 500 people over the year. Seven of which or eight of which. Seven or eight, I can't remember. Is organic.

That look structurally fundamentally the business has changed. We we're seeing it change, we have 2 addressable Tams

Speaker #5: I believe it's eight. So in saying that, I mean, significant training going in. We're comparing training. If we can get better at training, we can get scale out of that as well.

Speaker #5: I do think we have the ability to improve margins. It's still something we're trying to compound it. We have rate payers on the utility side.

Speaker #5: It's very much regulated. And so that said, we're doing a nice job on the technology TAM and we're also getting some synergies out of our training and getting people to the field.

Speaker #5: So super happy with where we're at.

Speaker #1: Thank you. Your next question will come from Julian Dumoulin-Smith with Jefferies. Please unmute and ask your question.

Both of which are growing so I I do that mix. We're looking at it constantly to make sure that we're giving you good prudent guidance. Um, yeah, I I do think we posted a, a real nice quarter. We were printed in the guidance that we get. We gave you in the back half, you're seeing Synergy show up. We're seeing a lot of book to burn. So I I I I do believe, like there is some room in the margins in the backside we took prudent approach to it. It's, there's no, you know, you got climbs and Northern climes. Whether we take everything in the wrist project slips, all that's already baked into to our numbers. So yeah, I think there's upside in the back and um you know as as we see it as we see the work mix as we see the mix in the electric segment, that's a big segment. Um so you know we have to really take into account everything in there and I think we've done a nice job of that but I do think

Speaker #6: Hey, guys. Good morning. Hopefully, you can hear me okay. I just wanted to utility in Midwest recently indicate for at least for their gas generation RFP that performance is inadequate resources.

Speaker #6: Again, given the stack drop, how do you think about your willingness to participate in the gas generation side of the business? Obviously, we saw a press release from you guys, Nice Source earlier.

There's room for margin Improvement in the backside. You know, we've always said that that the electric segment has the ability to operate 10 to 12 on the Utility side. 12 would be the utmost margins that you would see. And that's when you stacked in large transmission and all all aspects at once. So you get full, utilizations. You're also training a lot of people, I mean we've added 15,500 people over the year um you know, 7 of which are 8 of which

Speaker #6: How do you think about leaning further into that and what would that look like in as much as JV structure?

Seven or eight, I can't remember, is, uh, organic.

Speaker #5: Yeah. No, look, Julian, we're seeing the same thing. I mean, I do think some of the utilities, a few of the utilities are trying to self-perform.

Scale out of that as well. I do think we have, you know,

Speaker #5: Yeah, it sounds easy. It's not. So I think in general, we saw that in the past, back in, I don't know, it was probably 20 years ago, my age myself.

Speaker #5: Look, we know the risk. We know the risk of the people that we need to employ. Our cross-skilled labor is there. We're doing a nice job of building that business.

The ability to improve margins, it's still something we're trying to compound it but you have rate payers on the Utility side it's it's very much regulated and so that said you know we're doing a nice job on the technology Tam and we're also getting some some synergies out of our training and and you know getting people to the field. So super happy with where we're at.

Terrific. Thank you.

Sure.

Speaker #5: It's something meaningful in the future. We talked about it. As far as the robust nature of EPC on generation, not only in front of the meter, behind the meter, someone was saying not too long ago that we're just in front of the meter, I mean, behind the meter.

Thank you. Your next question will come from Julian Dumoulin Smith with Jeffrey's please unmute and ask your question.

Speaker #5: So we're on both sides of that. We're seeing some small engines. We're seeing big engines. We're seeing all types of generation. And we're installing the EPC in it.

Speaker #5: I like the business. We're just not willing to take the risk on the combined cycle side and then some of the single cycle engines.

Speaker #5: So that's the issue. If we can get the type of contracts that we need to feel comfortable with it, we'll do it. And certainly, the inbounds and ask of our customers, we did mention the Nice Source.

Hey guys! Good morning. Hopefully you can hear me. Okay. Um, just wanted to ask 1 we've seen a large utility Midwest recently indicate uh, for at least for their gas generation RFP, that they're electing the self-performed because it was inadequate resources. Again, given this backdrop. How do you think about your willingness to participate in the gas generation side of the business? Obviously, you saw a press release from you guys a nice Source earlier. How do you think about leaving further into that? And what would that look like in as much as you know, a JV structure is not obvious. I'm curious. Um, for your thoughts about this CPC app.

Speaker #5: I do believe a significant amount of that will go into backlog in the third quarter. That's moving nicely. There's some other what I believe opportunities in that part of the world that will continue to compound.

Yeah, no, look, Julian. We're saying the same thing. I mean, I do know some of the utilities—a few of the utilities—that are trying to self-perform, um,

Speaker #5: And not only them, but every customer we have, we're working with them on their capital plans to build both generation and T&D.

Yeah, it's it sounds easy. It's not. So I think in general we we saw that in the past back in. I don't know it's probably 20 years ago, my age myself. Um,

Speaker #6: Hey, guys. Appreciate it. Just a quick one on the technology side. Can you speak a little bit to how you're scaling that business? Is this just land and expand with existing customers?

Look, I we know the risk. We know the risk of of the people that that we need to employ our cross skill. Labor is there, we're doing a nice job of building that business, you know, it's something meaningful, um, in the future, we talked about it. Um, you know, I

Speaker #6: What exactly is going on within the details if you can just obviously, it's a nascent business model for folks. You got to know a lot of new entrants.

as far as like the robust nature of EPC on on generation, not only

Speaker #6: Just curiously, do you have a lot of interest relationships we're hearing about out there? How much of this is new customers and new platforms?

Speaker #6: And what do you intend to do from a strategic M&A perspective to continue to build this business too?

Speaker #5: Yeah, a lot to that. So when we think when we thought about it, when we acquired Cupertino, we acquired a platform. We talked about the technology customers that we thought that we could take our collaborative approach and build another TAM that's every bit as big as our utility TAM.

You know, in front of the meter behind the meter, you know, someone was saying not too long ago that we're just in front of the meter, I mean, behind the meter. So we're on both sides of that. We're seeing some, you know, Small Engines, we're seeing big engines, we're seeing all types of generation and, and we're installed in the EPC in it. I, I like the business, um, we're just not willing to take the risk on the combined cycle side and then, you know, some of the single cycle engines so that that's the issue. Um, if if we can get the type of contracts that we need to feel comfortable with it,

Speaker #5: We're doing that. It's showing up. Direct to the hyperscaler, direct to the larger customers. Showing them what we can do. Our self-perform capabilities. We show up.

We'll do it. And, you know, certainly the inbound and ask of our customers. We did mention the nice words. I do believe.

Speaker #5: We're on time. We're certain. And that's leading to balance of plant type builds and multiple areas. So call it 80% or of what a data center will build, less chips.

Speaker #5: And I think 90 maybe. So we have the abilities to do that. And as people see that we're certain and our projects are on time, on budget, self-perform, more and more adjustable market comes our way.

You know, a significant amount of that will go into backlog in the third quarter. Uh, that's moving nicely. Um, there's some, you know, other what I believe are opportunities in that part of the world that we'll continue to compound, and not only them, but every customer we have. You know, we're working with them on their capital plans to build both generation and T&D.

Hey guys.

Speaker #5: So I think we really like what we see. The collaborative nature. We talk about synergies a lot. And we don't put them in anything.

Speaker #5: But you can see from the quarter, they show up. We're crossing. We're fungible with labor. We're crossing both T and D as well as going into data centers with our people.

How you're scaling the business are you, is this just land and expand with existing customers? What exactly is going on within the details? If you can just obviously it's the Nathan business model for for folks, you got a lot of new interests, just curious like you have a lot of interest relationships you're hearing about out there.

Speaker #5: You can see the Qs on the utility side of substations, all the substations that are out there. We're right in the middle of that.

How much of this is new customers and new platforms? And what, what do you need to do from, like a strategic kind of name perspective to continue to build this business too?

Speaker #5: And I think as that nexus, I'm not sure people understand that nexus and how difficult it is to interconnect to the grid and how much we're right in the middle of that interconnection.

Speaker #5: So that interconnection along the vertical supply chains, the very strategies that we've discussed are showing up and the synergies are right there with them.

Speaker #5: So I do believe, Julian, as we look at technology, we're in a collaborative way helping them be certain on not only cost, but getting it done on time.

And a lot to that. So when I, when we think, when we thought about it, when we acquired Cupertino, we acquired the platform. We talked about the technology customers that we thought, you know, that we could take our collaborative approach and build a another Tam that's every bit as big as our utility team. We're doing that it's showing up, um, direct to the hyperscaler, direct to the larger customers showing them. You know what we can do? Our self-performed capability.

Speaker #5: So we really like where we sit.

Speaker #1: Your next question will come from Chad Dillard with Bernstein. You may now unmute and ask your question.

Speaker #7: Hey, good morning, guys. So my questions on the modular and pre-fab side of the business is increasingly clear that you guys are investing in that organically and inorganically.

Abilities, we show up. We're on time, we're certain and that's leading to balance of plant. Type builds in multiple areas. So, you know, call it 80% of of, of what a data center would build less chips. And I, I think 90, maybe so, we have the ability to do that, and as people see that, we're certain and our projects are on time on budget self-perform, um, more and more adjustable Market, comes our way.

Speaker #7: So I'd be curious to hear what share of your RFPs, have that capability, and how do you think about that on the next five years?

Speaker #7: And maybe you can talk about just the labor cost savings that you see when you deliver that and the extent to which you can value-based price with your customers on that.

Speaker #5: Yeah, I mean, look, we talked about having 7 million square feet. We just added, call it half a million square feet. With the acquisitions that we've made.

Speaker #5: So yes, we're adding to that. We've always done some what I would consider fabrication, but I do think this integrated fabrication that we're doing, it's different.

Speaker #5: It's a solution-based approach. It has a lot of video engineering and a lot of technology in front of it. We can really design from a construction nature and work with the client and what they're trying to accomplish.

Speaker #5: Less water, closed-loop systems, no water. All kinds of things that we're able to really, really work with the client upfront. I think we have some of the best engineers in the world because they've been in the field and they know how to construct.

And how much we're right in the middle of that interconnection. So that interconnection along the vertical Supply chains, the very strategies that we've discussed are showing up in the synergies are right there with them. So I I, I do believe Julian, as we look at technology, we're in a collaborative way, helping them be certain on not only cost but but getting it done on time. So we really like what we sit

Your next question will come from Chad, Dillard with Bernstein. You may now unmute and ask your question.

Speaker #5: So that allows us to really lean into these projects become much, much more efficient if we work in a collaborative manner with our client, much like we've done with AEP on 765.

Speaker #5: I mean, I think when we look at it, we work together and if we can do that, the fabrication is exponential. I don't but whether it's cost less or more or it's going to cost less.

Hey, good morning guys. Um, so my question is on the the modular and prefab side of the business, just increasingly clear that, you know, you guys are investing on in that organically and inorganically. So I'd be curious to hear, you know what share of your rfps like have that capability and how do you think about that?

Speaker #5: It's less people to some degree, depending on where you're at in your logistics. So logistics cost a significant amount. So you really need to be close to where you're building and I think that Northeast environment and what we've done there with the acquisition of Falcon really gives us a lot of opportunity in the east and the fabrication in the east.

Over the next five years— and we can talk about just, like, the labor cost savings that you see when you deliver that and the extent to which you can, you know, value-based price with your customers on that.

Speaker #5: that. We've always done some what I would consider fabrication, but I do think this integrated fabrication that we're doing, it's different. It's a solution-based approach.

Speaker #5: But yeah, look, you're certain as well. You're inside. And it allows us to really have a certain outcome. And the engineering in front of it allows the cost to come down.

Speaker #5: It has a lot of video engineering and a lot of technology in front of it. We can really design from a construction nature. And work with the client and what they're trying to accomplish.

Speaker #5: So yeah, the more collaborative the client is with us, what I would consider the total cost goes down significantly for them.

Speaker #5: Less water, closed-loop systems, no water. All kinds of things that we're able to really, really work with the client upfront. I think we have some of the best engineers in the world because they've been in the field and they know how to construct.

Speaker #7: Great. That's helpful. And then have you started to see RFPs for 800 volt work yet? When is that starting? And just from a labor standpoint, is there any difference in complexity the mix of labor force or even the use of modular when you're shifting from 54 to 800 volt architecture?

Speaker #5: So that allows us to really lean into these projects become much, much more efficient if we work in a collaborative manner with our client.

Speaker #5: Much like we've done with AEP on 765. I mean, I think when we look at it, we work together. And if we can do that, the fabrication is exponential.

Speaker #5: I'll just say it this way. We haven't seen it show up. We're in the middle of the engineering with it. We're all over it from the high-voltage side as well as equipment.

Speaker #5: I don't but whether it's cost less or more or it's going to cost less. It's less people to some degree, depending on where you're at in your logistics.

Speaker #5: Anything complicated? Anything with a higher voltage? The higher the voltage, the better for quantum. So I'll just say it like that. We love complicated high-voltage infrastructure.

Speaker #5: So logistics cost a significant amount. So you really need to be close to where you're building. And I think that Northeast environment and what we've done there with the acquisition of Falcon really gives us a lot of opportunity in the east.

Speaker #5: The more the better.

Speaker #7: Thanks.

Speaker #1: Your next question will come from Justin Hawk with Baird. You may now unmute and ask your question.

Speaker #5: And the fabrication in the east. But yeah, look, it's you're certain as well. You're inside. And it allows us to really have a certain outcome.

Speaker #8: Great. Thank you. I just got kind of one to obviously, there's a lot of positives on this quarter, but one, stand out as well was the free cash flow.

Speaker #5: And the engineering in front of it allows the cost to come down. So yeah, the more collaborative the client is with us, what I would consider the total cost goes down significantly for them.

Speaker #8: I just wanted to, I guess, maybe ask, are you seeing changes in kind of maybe prepayments or other things that are kind of favorable to work from capital from some of these large load customers that maybe it's a sustainable dynamic that maybe improves the free cash flow conversion over time or is it kind of just a one-off here this quarter?

Speaker #7: Great. That's helpful. And then have you started to see RFPs for 800 volt work yet? When is that starting? And just from a labor standpoint, is there any difference in complexity?

Speaker #7: The mix of labor force, or even the use of modular when you're shifting from 54 to 800 volt architecture?

Speaker #8: Thanks.

Speaker #1: Hey, Justin. No, we're very pleased with what's happening with free cash flow in our business. The first half of the year was very strong.

Speaker #5: I'll just say it this way. We haven't seen it show up. We're in the middle of the engineering with it. We're all over it from the high-voltage side as well as equipment.

Speaker #1: I think it's a real testament to the operators, how well they're performing. We are getting favorable contracting terms. Across the business, but the growth of the MEP business, our EPC business, and our renewables business is contributing to that free cash flow growth.

Speaker #5: Anything complicated? Anything with a higher voltage? The higher the voltage, the better for Quanta. So I'll just say it like that. We love complicated high-voltage infrastructure.

Speaker #1: So we believe that we're going to continue to see those types of factors coming into our free cash flow profile. It's improving our working capital as you said.

Speaker #5: The more the better.

Speaker #7: Thanks.

Speaker #1: Your next question will come from Justin Hawk with Baird. You may now unmute and ask your question.

Speaker #1: Having said that, we do think the right way to think about our business continues to be that conversion rate of around 55%. I talked about it in the investor day that we have the opportunities to be higher than that, 55 to 60%.

Speaker #8: Great. Thank you. I just got kind of one to obviously, there's a lot of pauses on this quarter, but one to stand out as well was the free cash flow.

Speaker #8: I just wanted to, I guess, maybe ask, are you seeing changes in kind of maybe prepayments or other things that are kind of favorable to work from capital from some of these large load customers that maybe it's a sustainable dynamic that maybe improves the free cash flow conversion over time?

Speaker #1: Do I believe that we can be at the high end of that even this year? And going forward, I do. I think there's opportunities even to beat it.

Speaker #1: But growth, where the growth matters. The strong utility business is continuing to grow in the back end as well. And as you know, that has a slightly different working capital profile.

Speaker #1: And it can pressure free cash flow. We've taken all that into account in our guide. And but I think you can expect Justin that we have real abilities to be at the high end of those free cash flow ranges and even better.

Speaker #8: Or is it kind of just a one-off here this quarter? Thanks.

Speaker #1: Hey, Justin. No, we're very pleased with what's happening with free cash flow in our business. The first half of the year was very strong.

Speaker #1: I think it's a real testament to the operators, how well they're performing. We are getting favorable contracting terms. Across the business, but the growth of the MEP business, our EPC business, and our renewables business is contributing to that free cash flow growth.

Speaker #8: Great. That's all for me. Thank you.

Speaker #1: Your next question will come from Sujita Jane with KeyBank. Please unmute and ask your question.

Speaker #9: Great. Thank you for taking that question. Can I ask one on Perceron? If I'm pronouncing that right, the acquisition that you made? How much of the revenue that they do is already revenue from Quanta and how much is third-party?

Speaker #1: So we believe that we're going to continue to see those types of factors coming into our free cash flow profile. It's improving our working capital as you said.

Speaker #9: And as you bring it in, are you going to focus it more on just working for Quanta? And then does this allow you to do more front-end work with data centers, or is it purely just a T&D type operation?

Speaker #1: Having said that, we do think the right way to think about our business continues to be that conversion rate of around 55%. I talked about it in the investor day that we have the opportunities to be higher than that, 55 to 60 percent.

Speaker #9: Thank you.

Speaker #5: Thank you, Sujita. So Perceron, when we looked at that, really, it's right away acquisition. It's things of that nature. None of which is for Quanta.

Speaker #1: Do I believe that we can be at the high end of that even this year? And going forward, I do. I think there's opportunities even to beat it.

Speaker #5: Very little, if any, was Quanta revenue. So it's all outside. The customer base would be utilities, hyperscalers, so both sides of that. The way we think about it, anything that from our standpoint that doesn't allow our field forces to move forward or we can collaborate with the client in a constructability way, we want that to be a part of the solution.

Speaker #1: But growth, where the growth comes from matters. The strong utility business is continuing to grow in the back end as well. And as you know, that has a slightly different working capital profile.

Speaker #1: And it can pressure free cash flow. We've taken all that into account in our guide. And but I think you can expect Justin that we have real abilities to be at the high end of those free cash flow ranges and even better.

Speaker #8: Great. That's all for me. Thank you.

Speaker #5: So they were a very much a solution for us on the front end. We believe added to Quanta in our constructability, we can work with the client on routes you hear about permitting quite a bit.

Speaker #1: Your next question will come from Sujita Jane with KeyBank. Please unmute and ask your question.

Speaker #9: Great. Thank you for taking that question. Can I ask one on Perceron? If I'm pronouncing that right, the acquisition that you made? How much of the revenue that they do is already revenue from Quanta, and how much is third-party?

Speaker #5: Land acquisition quite a bit. I'm getting tired of it. So as we see it, we felt like you can either gripe about it or you can fix it.

Speaker #5: So Perceron will allow us to provide a unique solution to the client on the front end where we believe we can move right away faster and in a more economical way to get our people in the field, both on the technology market and the actually, technology pipeline and utility T&D.

Speaker #9: And as you bring it in, are you going to focus it more on just working for Quanta? And then does this allow you to do more front-end work with data centers, or is it purely just a TND-type operation?

Speaker #9: Thank you.

Speaker #5: Thank you, Sujita. So Perceron, when we looked at that, really, it's right away acquisition. It's things of that nature. None of which is for Quanta.

Speaker #5: So super proud, great company. I believe we can exponentially grow that in the synergies are endless.

Speaker #5: Very little, if any, was Quanta revenue. So it's all outside. The customer base would be utilities, hyperscalers, so both sides of that. The way we think about it, anything that from our standpoint that doesn't allow our field forces to move forward, or we can collaborate with the client in a constructability way, we want that to be a part of the solution.

Speaker #9: Thank you.

Speaker #1: As a reminder, we ask that all participants limit themselves to one question. If you have additional questions, you can raise your hand and rejoin the queue.

Speaker #1: Our next question will come from Nick Amakuchi with Evercore ISI. Please unmute and ask your question.

Speaker #10: Hey guys, good morning. I just had a quick one too. Just given I mean, obviously, it seems like pretty strong organic performance within the quarter.

Speaker #5: So they were a very much a solution for us on the front end. We believe added to Quanta in our constructability, we can work with the client on routes you hear about permitting quite a bit.

Speaker #10: I just wanted to see I mean, if we could kind of break that out, how much was that was there any kind of pull forward of timing or weather implications within there?

Speaker #5: Land acquisition quite a bit. I'm getting tired of it. So as we see it, we felt like you can either gripe about it or you can fix it.

Speaker #10: Just given kind of more of a mild spring season.

Speaker #5: So Perceron will allow us to provide a unique solution to the client on the front end where we believe we can move right away faster and in a more economical way to get our people in the field, both on the technology market and actually technology pipeline and utility TND.

Speaker #5: No, I do think you bring up a good point on seasonality. We used to have a much more pronounced seasonality in the business with being inside and having kind of the electricians in the places that we're at.

Speaker #5: I do fabrication facilities. You're going to see that level out in the fourth and the second. It'll start to level. So it won't be as pronounced as it was in the past.

Speaker #5: So super proud, great company. I believe we can exponentially grow that in the synergies are endless.

Speaker #5: So I do think that's part of it. But as far as pull in, I mean, it is different from a standpoint, nothing pulled in at all that I'm aware of.

Speaker #9: Thank you.

Speaker #1: As a reminder, we ask that all participants limit themselves to one question. If you have additional questions, you can raise your hand and rejoin the queue.

Speaker #5: Just nothing. But what is happening we're getting on sites and people are starting to see us perform and they're asking for more services immediately.

Speaker #1: Our next question will come from Nick Amakuchi with Evercore ISI. Please unmute and ask your question.

Speaker #5: So we may book and bill 300 million on a site in a quarter. You never see it show up in backlog. That's part of MEP.

Speaker #10: Hey guys, good morning. I just had a quick one too. Just given I mean, obviously, it seems like pretty strong organic performance within the quarter.

Speaker #5: And that happens quite a bit. So we're working through that about how to look at those MSAs on the technology side, especially when we're building balance of plant in multiple areas.

Speaker #10: I just wanted to see I mean, if we could kind of break that out, how much was that was there any kind of pull forward of timing or weather implications within there?

Speaker #5: We'll need to look at that internally, to decide is a PO against an MSA or is it an MSA? So we're following gap, but I would tell you the book and burn on that type of work is certainly prevalent in the quarter and it will be prevalent as far as we can see because we continue to capture more balance of plant opportunities and kind of full-scale data center opportunities.

Speaker #10: Just given kind of more of a mild spring season.

Speaker #5: No, I do think you bring up a good point on seasonality. We used to have a much more pronounced seasonality in the business with being inside and having kind of the electricians in the places that we're at.

Speaker #5: And you'll see us on quite a few sites in the future.

Speaker #5: I do fabrication facilities. You're going to see that level out in the fourth and the second. It'll start to level. So it won't be as pronounced as it was in the past.

Speaker #1: Our next question will come from Adam Thelheimer with Thomson Davis. Please unmute and ask your question.

Speaker #5: So I do think that's part of it. But as far as pull in, I mean, it is different from a standpoint. Nothing pulled in at all that I'm aware of.

Speaker #11: Hey, good morning, guys. Congrats on the another great quarter. And a great year to date. Hey, Duke, I guess I wanted to dial in on your traditional T&D business.

Speaker #5: Just nothing. But what is happening we're getting on sites and people are starting to see us perform and they're asking for more services immediately.

Speaker #11: How would you say that's other than the obvious that it's good, how would you parse that how it's trending versus your initial expectations at the beginning of the year?

Speaker #5: So we may book and bill 300 million on a site in a quarter. You never see it show up in backlog. That's part of MEP.

Speaker #11: And I wanted to get an update on your long-term expectations from electric utility customers.

Speaker #5: And that happens quite a bit. So we're working through that about how to look at those MSAs on the technology side, especially when we're building balance of plant in multiple We'll need to look at that internally to decide is a PO against an MSA or is it an MSA?

Speaker #5: I think we're right on target. We kind of you haven't seen the compounding effect. I mean, we're not in backlog on any of the bigger work yet.

Speaker #5: Even the generation work, most of it is, I would say, 95% of it is not in backlog either. So those big projects to 765 corridors, 345, 500, all those bigger all that bigger work is just starting.

Speaker #5: So we're following gap. But I would tell you the book and burn on that type of work is certainly prevalent in the quarter and it will be prevalent as far as we can see because we continue to capture more balance of plant opportunities and kind of full-scale data center opportunities.

Speaker #5: A lot of it's in engineering. You'll start to see it hit backlog in the later half of the year and throughout what I would consider the decade.

Speaker #5: And you'll see us on quite a few sites in the future.

Speaker #5: So it's a long-term build well past 2030 on both sides of the business. So we're seeing those projects today, they'll show up in backlog.

Speaker #1: Our next question will come from Adam Thelheimer with Thomson Davis. Please unmute and ask your question.

Speaker #5: We'll go to the field, call it second half of '27. We'll start to see incremental gain there in the compounding stacking effect. We'll start to hit the backlog.

Speaker #11: Hey, good morning, guys. Congrats on another great quarter. And a great year to date. Hey, Duke, I guess I wanted to dial in on your traditional TND business.

Speaker #5: I continue to expect us to have record backlog. Into the third and probably even into the fourth. But definitely we see the work there and it has not started.

Speaker #11: How would you say that's other than the obvious that it's good, how would you parse that how it's trending versus your initial expectations at the beginning of the year?

Speaker #5: So kind of what I would say upper single digit growth in the business as it sits, doing nicely working with clients. So I think double digit type growth is there today and it's going to get much greater than that as we start compounding big work there.

Speaker #11: And I wanted to get an update on your long-term expectations from electric utility customers.

Speaker #5: I think we're right on target. We kind of you haven't seen the compounding effect. I mean, we're not in backlog on any of the bigger work yet.

Speaker #5: It's going to look much like it did call it 15 before '15 was it 12 to 15 somewhere in there when we were on a bunch of big projects and started compounding.

Speaker #5: Even the generation work, most of it is, I would say, 95% of it is not in backlog either. So those big projects, the 765 corridors, 345, 500, all those bigger all that bigger work is just starting.

Speaker #5: We see that type of effect. Yes, it's big numbers, but the big numbers are going to compound as well. So we're super excited about where that's going.

Speaker #5: Early stages and it'll start to show up, call it in backlog this year and in the field next year.

Speaker #5: A lot of it's in engineering. You'll start to see it hit backlog in the later half of the year. And throughout what I would consider the decade.

Speaker #11: Perfect. Thanks, Duke.

Speaker #5: Thanks.

Speaker #5: So it's a long-term build well past 2030 on both sides of the business. So we're seeing those projects today, they'll show up in backlog.

Speaker #1: Your next question will come from Liam Burke with B. Riley Securities. Please unmute and ask your question.

Speaker #12: Yeah. Thank you, Duke. Just a quick follow-on on what we just discussed on your longer-term planning on the electric side. Going back to the backlog, so your backlog similar to what you discussed last quarter is more broader based across the businesses rather than you bringing in these larger projects.

Speaker #5: We'll go to the field, call it second half of '27. We'll start to see incremental gain there in the compounding stacking effect. We'll start to hit the backlog.

Speaker #5: I continue to expect us to have record backlog. Into the third and probably even into the fourth. But definitely we see the work there.

Speaker #5: That's right. I mean, I do think those larger projects you're going to get some lumpy quarters where your one-to-one one-two, you're going to start to see one-five, one-six as you bring in the big chunks of projects.

Speaker #5: And it has not started. So kind of what I would say upper single-digit growth in the business as it sits, doing nicely working with clients.

Speaker #5: So I think double-digit type growth is there today. And it's going to get much greater than that as we start compounding big work there.

Speaker #5: And it's going to happen. We saw some of it when we brought in 765 last quarter. You saw a big boost up. It was broad-based, but it also had a big project in it.

Speaker #5: It's going to look much like it did call it 15 before '15 was it 12 to 15 somewhere in there when we were on a bunch of big projects and started compounding.

Speaker #5: We see that type of effect. Yes, it's big numbers, but the big numbers are going to compound as well. So we're super excited about where that's going.

Speaker #5: That's going to happen it's not going to be straight line. You're going to see some lumpy kind of quarters, but all kind of lower lows, higher highs.

Speaker #5: Early stages and it'll start to show up, call it in backlog this year and in the field next year.

Speaker #5: All the way through the way we see it because I just think we can't predict timing and bookings on that big work. It just takes time and we're in LNTPs all over the place and verbals all over the place with lots of clients and a collaborative way.

Speaker #11: Perfect. Thanks, Duke.

Speaker #5: Thanks.

Speaker #1: So our next question will come from Liam Burke with B. Riley Securities. Please unmute and ask your question.

Speaker #12: Yeah. Thank you, Duke. Just a quick follow-on on what we just discussed on your longer-term planning on the electric side. Going back to the backlog, so your backlog similar to what you discussed last quarter is more broader based across the businesses rather than you bringing in these larger projects.

Speaker #5: I just really like the collaboration the company is doing. We're really trying to help our clients. And I think giving them certainty, working with them, driving the cost down to the rate payer the company's highly focused on driving the cost down to the rate payer.

Speaker #5: I think that's the deal we're really working hard with throughout on the T&D side. And I like where that's going. It's certainly given us a multi-year, even decade look outward.

Speaker #5: That's right. I mean, I do think those larger projects you're going to get some lumpy quarters where your one-to-one one-two, you're going to start to see one-five, one-six as you bring in the big chunks of projects.

Speaker #5: You can see their capital budgets. It's something we can point our finger to. We're working hard together. I like where the industry is going.

Speaker #12: Great. Thank you, Duke.

Speaker #5: And it's going to happen. We saw some of it when we brought in 765 last quarter. You saw a big boost up. It was broad-based, but it also had a big project in it.

Speaker #1: Your next question will come from Philip Shen with Ross Capital Partners. You may unmute and ask your question.

Speaker #12: Hey, guys. Congrats again on the strong results. Hey, wanted to check in with you on the recent New York state ban or pause on data centers.

Speaker #5: That's going to happen. It's not going to be straight line. You're going to see some lumpy kind of quarters, but all kind of lower lows, higher highs.

Speaker #5: All the way through the way we see it because I just think we can't predict timing and bookings on that big work. It just takes time.

Speaker #12: We published recently that we could see as many as 10 more states pursue data center bans or pauses by the end of this year.

Speaker #5: And we're in LNTPs all over the place. And verbals all over the place with lots of clients and a collaborative way. I just really like the collaboration the company is doing, really trying to help our clients.

Speaker #12: What are your thoughts on this potential risk? How could it impact your business? And then when you add data center work to your backlog, have these projects been cleared of all permitting, environmental approvals?

Speaker #5: And I think giving them certainty, working with them, driving the cost down to the rate payer, the company is highly focused on driving the cost down to the rate payer.

Speaker #12: Community support? I'm guessing the answer is yes, but just was wondering if you can talk through, is there any risk that some of these state bans or pauses could take some of the projects out of backlog?

Speaker #5: I think that's the deal we're really working hard with throughout on the TND side. And I like where that's going. It's certainly giving us a multi-year, even decade look outward.

Speaker #12: Thanks.

Speaker #5: Sure. So just a couple of things. It's a good question because it gives me an opportunity to freelance a little bit here. What I would say is 15% of the business is technology, call it 15 to 20, right in there.

Speaker #5: You can see their capital budgets. It's something we can point our finger to. We're working hard together. I like where the industry is going.

Speaker #5: And that's a spectrum of chips to everything, not just data centers. So it's not a huge piece of the business, number one. We've grown that to that range over the last two years.

Speaker #12: Great. Thank you, Duke.

Speaker #1: Your next question will come from Philip Shen with Ross Capital Partners. You may unmute and ask your question.

Speaker #12: Hey, guys. Congrats again on the strong results. Hey, wanted to check in with you on the recent New York state ban or pause on data centers.

Speaker #5: Which I think is phenomenal. We built a hell of a business already. And got a long way to go. So very early stages. And the quality of the companies that we've acquired is just phenomenal.

Speaker #12: We published recently that we could see as many as 10 more states pursue data center bans or pauses by the end of this year.

Speaker #5: It's super proud of the platforms. So in saying that, look, we're involved in lots of data centers. I haven't seen much in New York.

Speaker #12: What are your thoughts on this potential risk? How could it impact your business? And then when you add data center work to your backlog, have these projects been cleared of all permitting, environmental approvals, community support?

Speaker #5: Nothing really gets built there. So it's very difficult to build in New York. And I haven't a moratorium in New York doesn't bother me at all.

Speaker #12: I'm guessing the answer is yes, but just was wondering if you can talk through, is there any risk that some of these state bans or pauses could take some of the projects out of backlog?

Speaker #5: I just hope we can get enough power to continue to keep the lights on. So that's our highly focused there on that. What I would say is in general, when we think about data centers, I just it's such a fallacy of the amount of water and what it does for an economy.

Speaker #12: Thanks.

Speaker #5: Sure. So just a couple of things. It's a good question because it gives me an opportunity to freelance a little bit here. What I would say is 15% of the business is technology, call it 15 to 20, right in there.

Speaker #5: I mean, in rural areas, the school districts and the kids and the teachers, we employ people there I mean, it's such a benefit to everyone that is building in those areas.

Speaker #5: And that's a spectrum of chips to everything, not just data centers. So it's not a huge piece of the business, number one. We've grown that to that range over the last two years.

Speaker #5: And it's not a one-year build. These are eight, 10-year areas that build and you're providing jobs. And if you look at Northern Louisiana, where they're building there, yeah, they're using a little bit more water than some other areas.

Speaker #5: Which I think is phenomenal. We built a hell of a business already. And got a long way to go. So very early stages. And the quality of the companies that we've acquired is just phenomenal.

Speaker #5: I would say there's better designs today and you can use less water. But what that's done for teachers, teachers with the lowest paid in all of Louisiana, they will be the highest paid in Louisiana in that area.

Speaker #5: It's super proud of the platforms. So in saying that, look, we're involved in lots of data centers. I haven't seen much in New York.

Speaker #5: All the teachers. All the what it does for the rate-based, the economies, I just don't think it gets the press. We're not doing a good enough job talking about the good things about data centers.

Speaker #5: Nothing really gets built there. So it's very difficult to build in New York. And I haven't a moratorium in New York. Doesn't bother me at all.

Speaker #5: National security, everything else that I see, it reminds me a lot of the fracking rhetoric that was out there. So it's just something that I think we have to do a great job to tell the benefits to the industry and how we see it and what it's done to create jobs and good jobs.

Speaker #5: I just hope we can get enough power to continue to keep the lights on. So that's our highly focused there on that. What I would say is in general, when we think about data centers, I just it's such a fallacy of the amount of water and what it does for an economy.

Speaker #5: I think you can look at our median wage and see it's very, very good for us and the economy. So look, we're not seeing any shortage of places to go to work.

Speaker #5: I mean, in rural areas, the school districts and the kids and the teachers, we employ people there I mean, it's such a benefit to everyone that is building in those areas.

Speaker #5: And we're moving forward really working in local areas to provide jobs. And as long as we do that and I believe we're on the right side of the rhetoric with data centers and I like where it's going.

Speaker #5: And it's not a one-year build. These are eight, 10-year areas that build and you're providing jobs. And if you look at Northern Louisiana, where they're building there, yeah, they're using a little bit more water than some other areas.

Speaker #2: Yeah. And Phil, just on the backlog, I think it's important to add that we take all those into account. The way we treat our backlog, just like we do on the T&D side, just like we do on the generation side, we want to make sure that we're we have a constructive and prudent way of what goes into backlog.

Speaker #5: I would say there's better designs today and you can use less water. But what that's done for teachers, teachers with the lowest paid in all of Louisiana, they will be the highest paid in Louisiana in that area.

Speaker #2: So on the data center side, we tend to put in things that have only LNTPs and we don't put the rest of it until the project is a go.

Speaker #5: All the teachers, all the what it does for the rate-based, the economies, I just don't think it gets suppressed. We're not doing a good enough job talking about the good things about data centers.

Speaker #2: So I think you can be confident in what we have in our backlog as a result.

Speaker #5: Yeah. And we're seeing both of your projects too. So I mean, we're out well beyond 2030.

Speaker #5: National security, everything else that I see, it reminds me a lot of the fracking rhetoric that was out there. So it's just something that I think we have to do a great job to tell the benefits to the industry.

Speaker #12: Got it. Thanks, Ken.

Speaker #1: Your next question will come from Alex Rigel with Texas Capital Securities. Please unmute and ask your question.

Speaker #5: And how we see it and what it's done to create jobs and good jobs. I think you can look at our median wage and see it's very, very good for us and the economy.

Speaker #5: Thank you. Good morning. Great quarter. Could you speak a bit more about Underground and Infrastructure and in particular pipelines? And are you seeing any green shoots develop?

Speaker #5: So look, we're not seeing any shortage of places to go to work. And we're moving forward really working in local areas to provide jobs.

Speaker #12: Yeah. I mean, look, I think we certainly have opportunities. I think we're probably we booked a little bit of Canada where in the quarter.

Speaker #5: And as long as we do that and I believe we're on the right side of the rhetoric with data centers and I like where it's going.

Speaker #12: So a real nice job there. With that. So proud about that one. I think we'll book more in Canada. The opportunities I would say later half of 2026 into 2027 for us are there.

Speaker #1: Yeah. And Phil, just on the backlog, I think it's important to add that we take all those into account. The way we treat our backlog, just like we do on the TND side, just like we do on the Generation side, we want to make sure that we're we have a constructive and prudent way of what goes into backlog.

Speaker #12: That business is getting better. So yeah, I mean. It's something we're looking at. And as it kind of how we look at it, we kind of put 500 million in our head and that's where it's at.

Speaker #1: So on the data center side, we tend to put in things that have only LNTPs and we don't put the rest of it until the project is a go.

Speaker #12: We're well past that. For the year, probably and beyond. So we'll relook at that as how we guide. But no, Alex, I think it's all risk.

Speaker #1: So I think you can be confident in what we have in our backlog as a result.

Speaker #12: We'll be cognizant of how we look at the risk and our generation business is growing nicely. Some things there. So we're able to use some of those assets and people and project management teams on the generation side.

Speaker #5: Yeah. And we're seeing most of your projects too. So I mean, we're out well beyond 2030.

Speaker #12: Got it. Thanks again.

Speaker #12: There's a lot of pipe feeding generation that we can bundle that in as well. So that solution-based approach on the technology side applies to the pipeline as well.

Speaker #1: Your next question will come from Alex Rigel with Texas Capital Securities. Please unmute and ask your question.

Speaker #5: Thank you. Good morning. Great quarter. Could you speak a bit more about Underground and Infrastructure and in particular pipelines? And are you seeing any green shoots develop?

Speaker #12: It gives us a lot of opportunity there to do some unique things with pipe.

Speaker #5: And Jaysharee, earlier you mentioned contract terms have improved. Can you expand upon that a little bit and maybe in particular how they've changed across various end markets?

Speaker #12: Yeah. I mean, look, I think we have certainly have opportunities. I think we're probably we booked a little bit of Canada where in the quarter.

Speaker #2: Yeah. We're just, as we sit here, we're looking at our renewables business, our MEP business, our EPC business on the T&D side. It allows us to have really favorable cash flow terms on the working capital profile on those things.

Speaker #12: So a real real nice job there. With that. So proud about that one. I think we'll book more in Canada. The opportunities I would say later half of 2026 into 2027 for us are there.

Speaker #2: Our very positive. We're seeing that across our business. Not just in certain markets. The MEP and renewables business and EPC work on our traditional business tends to have the more pronounced favorable working capital profile.

Speaker #12: That business is getting better. So yeah, I mean, it's something we're looking at. And as it kind of how we look at it, we kind of put 500 million in our head and that's where it's at.

Speaker #12: We're well past that. For the year, probably and beyond. So we'll relook at that as how we guide. But no, Alex, I think it's all risk.

Speaker #2: And that is getting baked in. But we've talked about this a lot, right? As we sit here today in these markets, and the strength of our portfolio and our ability to help our customers, we're very much focused on compounding and growing with them.

Speaker #12: We'll be cognizant of how we look at the risk and our generation business is growing nicely. Some things there. So we're able to use some of those assets and people and project management teams on the generation side.

Speaker #2: And so our contracting terms are a reflection of that. And while we're not necessarily trying to take advantage of our customers in any way, it is allowing us to make sure that we're doing things in the way that allows us to be confident about our execution capabilities and delivering for them in the right manner.

Speaker #12: There's a lot of pipe feeding generation that we can bundle that in as well. So that solution-based approach on the technology side applies to the pipeline as well.

Speaker #12: It gives us a lot of opportunity there to do some unique things with the pipe.

Speaker #5: And Jayshree, earlier you mentioned contract terms have improved. Can you expand upon that a little bit and maybe in particular how they've changed across various end markets?

Speaker #2: So that's what's getting reflected across our business. It's not just on working capital, but it's in terms across the company.

Speaker #1: Yeah. We're just, as we sit here, we're looking at our renewables business, our MEP business, our EPC business on the TND side. It allows us to have really favorable cash flow terms on the working capital profile on those things.

Speaker #5: Excellent. Thank you.

Speaker #1: Your next question will come from Brian Brokery with Seiffel. Please unmute and ask your question.

Speaker #1: Our very positive. We're seeing that across our business. Not just in certain markets. The MEP and renewables business and EPC work on our traditional business tends to have the more pronounced favorable working capital profile.

Speaker #4: Yeah. Thanks. Good morning. Congrats on a really great quarter. Obviously, there was a meaningful uplift in the technology and large load outlook. Curious if there was any notable large bookings on the integrated fabrication part of the business in the quarter.

Speaker #4: And if that was a core driver of the upside or is it more broad-based and MEP? Thanks.

Speaker #1: And that is getting baked in. But we've talked about this a lot, right? As we sit here today in these markets, and the strength of our portfolio and our ability to help our customers, we're very much focused on compounding and growing with them.

Speaker #5: I think it's broad-based the way we see it. Certainly, MEP business is growing faster than the rest of the business. Just percentage-wise, but what I would say is if you look at the whole outlook, I would tell you it's all of it's pushing upward.

Speaker #1: And so our contracting terms are a reflection of that. And while we're not necessarily trying to take advantage of our customers in any way, it is allowing us to make sure that we're doing things in the way that allows us to be confident about our execution capabilities and delivering for them in the right manner.

Speaker #5: Both segments are pushing upward. The electric segment is moving up. I mean, our renewable business is really good. It's moved up nicely. So I would tell you all things that we discussed and are at least double digits.

Speaker #1: So that's what's getting reflected across our business. It's not just on working capital, but it's in terms across the company.

Speaker #5: Some are double digit plus, but everything's moving upward at least double digits. And I'm sure it's CEO Mads. I'm probably it's probably 9.9 in some area, but very close to double digits.

Speaker #5: Excellent. Thank you.

Speaker #1: Your next question will come from Brian Brokery with Seiffel. Please unmute and ask your question.

Speaker #5: And some of it much greater some of the parts, obviously.

Speaker #2: Yeah. Thanks. Good morning. Congrats on a really great quarter. Obviously, there was a meaningful uplift in the technology and large load outlook. Curious if there was any notable large bookings on the integrated fabrication part of the business in the quarter.

Speaker #4: Appreciate it. And then just one quick one, if you wouldn't mind. Did you see any notable Sunzia closeout benefits in the quarter or anything that was more one-time?

Speaker #4: Thanks.

Speaker #2: No. I think you can just the closeouts happen all the time. We're so large, you're going to have projects close out, you're going to have projects start.

Speaker #2: And if that was a core driver of the upside or is it more broad-based in MEP? Thanks.

Speaker #2: There was nothing one-time in our quarterly results.

Speaker #5: I think it's broad-based the way we see it. Certainly, MEP business is growing faster than the rest of the business. Just a percentage-wise, but what I would say is if you look at the whole outlook, I would tell you it's all of it's pushing upward.

Speaker #4: Appreciate it. Thank you.

Speaker #5: I do like it when they go up though. I'd rather them go up and down. But in general, they typically go up and it's nothing out of the ordinary.

Speaker #5: It's normal course.

Speaker #4: Understood.

Speaker #1: Your next question will come from Joseph Osha with Guggenheim Partners. Please unmute and ask your question.

Speaker #5: Both segments are pushing upward. The electric segment is moving up. I mean, our renewable business is really good. It's moved up nicely. So I would tell you all things that we discussed and are at least double digits.

Speaker #4: Oh, hi. Thanks, everybody. So Duke, you've been adding manufacturing capabilities in a couple of areas, transformers. You bought a utility pole company. I'm wondering if there are other areas that you're thinking about in terms of where you might want to add capabilities.

Speaker #5: Some are double digit plus, but everything's moving upward at least double digits. And I'm sure it's CEO Mads. I'm probably 9.9 in some area, but very close to double digits.

Speaker #4: Thank you.

Speaker #5: Yeah. I mean, look, we did the breaker deal with Heiko. I thought that was a critical path for us and the high voltage breakers.

Speaker #5: And some of it much greater some of the parts, obviously.

Speaker #5: They're very difficult to get. So you've seen us build them. You've seen us partner. We certainly have great relationships with the suppliers. Anywhere there's a critical path that we think we can invest capital to move it forward, that's what you've seen us do.

Speaker #2: Appreciate it. And then just one quick one, if you wouldn't mind. Did you see any notable Sunzia closeout benefits in the quarter or anything that was more one-time?

Speaker #2: Thanks.

Speaker #1: No. I think you can just the closeouts happen all the time. We're so large, you're going to have projects close out. You're going to have projects start.

Speaker #5: So as we're looking out, we're taking advantage of areas where there's under investment or we believe it's something that is critical path for us.

Speaker #1: There was nothing one-time in our quarterly results.

Speaker #5: Yeah.

Speaker #5: And we're working with our clients to really innovate as well with R&D and some things we can do there. So that innovation technology how we look at it, but we've made those investments in that vertical supply chain.

Speaker #2: Appreciate it. Thank you.

Speaker #5: I do like it when they go up though. I'd rather them go up than down. But in general, they typically go up and it's nothing out of the ordinary.

Speaker #5: It's normal course.

Speaker #5: I think it's showing up in some of the synergies. I think you'll continue to see it. We'll be selective in how we invest there.

Speaker #2: Understood.

Speaker #1: Your next question will come from Joseph Osha with Guggenheim Partners. Please unmute and ask your question.

Speaker #5: That's something that we look at it all the time, but we do believe we can do some unique things with our vertical supply chain.

Speaker #4: Oh, hi. Thanks, everybody. So Duke, you've been adding manufacturing capabilities in a couple of areas, transformers. You bought a utility pole company. I'm wondering if there are other areas that you're thinking about in terms of where you might want to add capabilities.

Speaker #5: And have done. So it'll be a broad-based investment and things that are what you would consider a critical path.

Speaker #4: We see a lot of people buying EBOS companies. Is that something that you think might be a good fit for Quanta?

Speaker #4: Thank you.

Speaker #5: Yeah. I mean, look, we did the breaker deal with HICO. I thought that was a critical path for us. And the high-voltage breakers, they're very difficult to get.

Speaker #5: Yeah. Look, we're not looking at EBOS companies. That's fine. I mean, look, I'm sure they're great companies and everyone's doing well with them. But it's not something that we're looking at today.

Speaker #5: So you've seen us build them. You've seen us partner. We certainly have great relationships with the suppliers. Anywhere there's a critical path that we think we can invest capital to move it forward, that's what you've seen us do.

Speaker #5: What we're looking at all kinds of things. It could be a component thereof or whatever it may be. But traditionally, the core of the business is craft skilled labor.

Speaker #5: We're focused highly focused on craft skilled labor and bringing that to the field in a way that solution-based. If EBOS or anything else can help us with the solution, we're certainly leaning into those opportunities.

Speaker #5: So as we're looking out, we're taking advantage of areas where there's under investment or we believe it's something that is critical path for us.

Speaker #5: We're working with our clients to really innovate as well with R&D and some things we can do there. So that innovation technology how we look at it, but we've made those investments in that vertical supply chain.

Speaker #4: Thank you.

Speaker #1: As a reminder, we ask that all participants limit themselves to one question. If you'd like to ask another question, you can rejoin the queue.

Speaker #5: I think it's showing up in some of the synergies. I think you'll continue to see it. We'll be selective in how we invest there.

Speaker #1: Our next question will come from Jamie Cook with Truist. Please unmute and ask your question.

Speaker #6: Hi. Congrats on another fantastic quarter. Can you hear me?

Speaker #5: That's something that we look at it all the time, but we do believe we can do some unique things with our vertical supply chain.

Speaker #5: Yeah. Thank you.

Speaker #6: Oh, good. You can hear me. Oh, so Duke, I just guess one question. I mean, I've been beating you up on your underground margins for years and finally it sounds these margins are really starting to improve.

Speaker #5: And have done. So it'll be a broad-based investment and things that are what you would consider a critical path.

Speaker #4: We see a lot of people buying EBOS companies. Is that something that you think might be a good fit for Quanta?

Speaker #6: I guess with some of these acquisitions that you're doing and some of the structural improvements you're making, I'm wondering over time, although it's not in your sort of longer-term margin targets, is there a path in particular with some of these higher margin acquisitions for your underground margins to approach the electric business?

Speaker #5: Yeah. Look, we're not looking at EBOS companies. That's fine. I mean, look, I'm sure they're great companies and everyone's doing well with them. But it's not something that we're looking at today.

Speaker #6: Is that totally off base? Thanks.

Speaker #5: What we're looking at all kinds of things. It could be a component thereof or whatever it may be. But it's traditionally the core of the business is craft skilled labor.

Speaker #5: Yeah. I mean, there's always opportunity. It just depends on the work mix. I mean, some of those margins you can pull up and it depends on the risk.

Speaker #5: We're focused highly focused on craft skilled labor and bringing that to the field in a way that solution-based. If EBOS or anything else can help us with the solution, we're certainly leaning into those opportunities.

Speaker #5: It depends on some of the fabrication. Yeah. Look, I do think you can pull them up. We got to let me get to the double digits first and then I'll go from there.

Speaker #5: But I do think we have opportunities to get a parity to electric. You can do it. It just depends on what the mix looks like.

Speaker #4: Thank you.

Speaker #1: As a reminder, we ask that all participants limit themselves to one question. If you'd like to ask another question, you can rejoin the queue.

Speaker #5: We're certainly I think that's one thing that companies highly focus on is increasing our efficiencies. Some of the labor is fungible. So it's moving across segments.

Speaker #1: Our next question will come from Jamie Cook Truist. Please unmute and ask your question.

Speaker #5: It's moving over into the electric segment. They move back and forth. I mean, we can have someone on what I would consider a data center or go to an industrial base come back into compression.

Speaker #6: Hi. Congrats on another fantastic quarter. Can you hear me?

Speaker #5: Yeah. Thank you.

Speaker #6: Oh, good. You can hear me. Oh, so Duke, I just guess one question. I mean, I've been beating you up on your underground margins for years and finally it sounds these margins are really starting to improve.

Speaker #5: On gas side. So we can move electricians and underground folks across multiple segments, which I really like a lot. So it's hard to say because they are making the margins in the electric side on one side of the business as that labor is fungible.

Speaker #6: I guess with some of these acquisitions that you're doing and some of the structural improvements you're making, I'm wondering over time, although it's not in your sort of longer-term margin targets, is there a path in particular with some of these higher margin acquisitions for your underground margins to approach the electric business?

Speaker #5: But the. The kind of the outlook on the customer base in the UI segment. Yeah. We can move it up and you'll see that move up and we could get it to parity electric.

Speaker #6: Is that totally off base? Thanks.

Speaker #5: It's possible.

Speaker #5: Yeah. I mean, there's always opportunity. It just depends on the work mix. I mean, some of those margins you can pull up and it depends on the risk.

Speaker #1: Your next question comes from Michael Dudes with Vertical Research Partners. Please unmute and ask your question. Michael, your line is open. Please unmute and ask your question.

Speaker #5: It depends on some of the fabrication. Yeah. Look, I do think you can pull them up. We got to let me get to the double digits first and then I'll go from there.

Speaker #5: But I do think we have opportunities to get a parity to electric. You can do it. It just depends on what the mix looks like.

Speaker #7: Thank you, everyone.

Speaker #5: We're certainly I think that's one thing that companies highly focused on is increasing our efficiencies. Some of the labor is fungible. So it's moving across segments.

Speaker #5: Hey, Mike.

Speaker #6: Hello.

Speaker #7: Duke, just your sense of what your customers maybe on the MSA side or even just across the board, how far out in the future are they asking to secure your specialized craft labor generally?

Speaker #5: It's moving over into the electric segment. They move back and forth. I mean, we can have someone on what I would consider a data center or go to an industrial base come back into compression.

Speaker #7: And I'm sure there's ranges of months to years. How is that change, say, in the last 12 to 18 months? And do you anticipate to get even further tighter out into the future where you have to allocate these resources a little bit more judiciously?

Speaker #5: On gas side. So we can move electricians and underground folks across multiple segments, which I really like a lot. So it's hard to say because they are making the margins in the electric side on one side of the business is that labor is fungible.

Speaker #5: But the kind of the outlook on the customer base in the UI segment, yeah, we can move it up and you'll see that move up and we could get it to parity electric.

Speaker #5: Yeah. I mean, we're nowhere near capacity. I know that's been something that people are worried about. So look, you've seen us add 15,000 employees in the quarter.

Speaker #5: And well, let me back up. 15,000 in a year. Significant amount of which is in the second quarter. Some through acquisitions, some through organic growth.

Speaker #5: It's possible.

Speaker #1: Your next question comes from Michael Ludus with Vertical Research Partners. Please unmute and ask your question. Michael, your line is open. Please unmute and ask your question.

Speaker #5: But well over 7,000 in organic growth. We're very much in line with the customer building out programs we're as far out as their capital plans, at least, and beyond.

Speaker #5: So when you're looking at their capital plans, they're out. 5, 7 years. We're helping them with capital. We're helping them all the way through in a collaborative manner.

Speaker #7: Thank you, everyone.

Speaker #5: Hey, Mike.

Speaker #6: Hello.

Speaker #7: Duke, just your sense of what your customers maybe on the MSA side or even just across the board, how far out in the future are they asking to secure your specialized craft labor generally?

Speaker #5: Across the board, having great collaborative conversations on it. So I would say the inbounds are significant to companies in a different placement it's ever been.

Speaker #5: How we sit, how we're viewed I think the number one thing is how do people feel about us and then I feel real good about how we sit in the industry we serve.

Speaker #7: And I'm sure there's ranges of months to years. How is that change, say, in the last 12 to 18 months? And do you anticipate to get even further tighter out into the future where you have to allocate these resources a little bit more judiciously?

Speaker #5: And we've done a real nice job. The men and women in the field are executing in a phenomenal level. And we see decade-plus type arrangements out there.

Speaker #5: Yeah. I mean, we're nowhere near capacity. I know that's been something that people are worried about. So look, you've seen us add 15,000 employees in the quarter.

Speaker #1: Your next question comes from Mai Mandloy with Miziho. You may unmute and ask your question.

Speaker #5: And well, let me back up. 15,000 in a year. Significant amount of which is in the second quarter throughout some through acquisitions, some through organic growth.

Speaker #5: Hey, thanks. Congratulations on the quarter as well. Maybe just like a level question. Duke, where are you seeing the bottlenecks as you go into data centers or for generation and transmission distribution?

Speaker #5: But well over 7,000 in organic growth. We're very much in line with the customer building out programs we're as far out as their capital plans, at least, and beyond.

Speaker #5: Is it still the craft labor and is there a scenario where you foresee potential competition or oversupply on that aspect a few years down the line and maybe labor or craft moves from other industries of this so you have more training or more automation?

Speaker #5: So when you're looking at their capital plans, they're out. 5, 7 years. We're helping them with capital. We're helping them all the way through in a collaborative manner.

Speaker #5: Across the board, having great collaborative conversations on it. And I would say the inbounds are significant to companies in a different placement it's ever been.

Speaker #5: Thanks. Look, we're not seeing any sort of I mean, we're not seeing any oversupply across the labor for the near future. It takes about four years to make a craftsman an adjournment.

Speaker #5: How we sit, how we're viewed I think the number one thing is how do people feel about us and I feel real good about how we sit in the industry we serve.

Speaker #5: We happen to have more adjournment in all crafts than most. We'll probably in the electric side, MEP side, I would say we're gaining we're very close and our training facilities and things that we've invested in over a decade we spend about $250 million a year in training.

Speaker #5: And we've done a real nice job. The men and women in the field are executing in a phenomenal level. And we see decade-plus type arrangements out there.

Speaker #5: So that's something we're highly focused on and have been for a decade. I know we're making it look a little easy. It is not easy.

Speaker #1: Your next question comes from Mait Mandloy with Miziho. You may unmute and ask your question.

Speaker #5: Whatsoever. And it's just the fact is we've done this for a long time. And I don't think you're going to see an oversupply in any means in the near future.

Speaker #5: Hey, thanks. Congratulations on the quarter as well. Maybe just like high-level question, Duke, where are you seeing the bottlenecks as you go into data centers or for generation and transmission distribution?

Speaker #5: And we see a lot of money getting thrown at it. It takes adjournment to make adjournment. I'll say it again. It takes multi-years and the more years under their belt, the better they are.

Speaker #5: Still the craft labor and is there a scenario where you foresee potential competition or oversupply on that aspect a few years down the line and maybe labor or craft moves from other industries of this so you have more training or more automation?

Speaker #5: The more productive. So I think when we look at it, no oversupply, the bottlenecks would be generation to some degree. And I know the generation is going to say it's EPC.

Speaker #5: Thanks. Look, we're not seeing any sort of I mean, we're not seeing any oversupply across the labor for the near future. It takes about four years to make a craftsman a journeyman.

Speaker #5: So yeah, look, some of it's technical. It is difficult to have the capacity to build combined cycles at the levels that everyone wants to build them at and as quick as they want to build them at.

Speaker #5: We're working hard to build those capabilities internally. We've done a real nice job. We have what I consider a significant business in front of us in the generation side.

Speaker #5: We happen to have more journeymen in all crafts than most. We'll probably in the electric side, MEP side, I would say we're gaining we're very close and our training facilities and things that we've invested in over a decade we spent about $250 million a year in training.

Speaker #5: So that's organic growth for us. We really like where it's going. And we put in the resources and the training and getting great people here that want to work for Quantum.

Speaker #5: So that's something we're highly focused on and have been for a decade. I know we're making it look a little easy. It is not easy.

Speaker #5: So real happy with both sides of that. There is bottlenecks here or there. I do think for the most part, most data centers want to go back to the grid at some point.

Speaker #5: Whatsoever. And it's just the fact is we've done this for a long time. And I don't think you're going to see an oversupply in any means in the near future.

Speaker #5: And not to say that last time I got in trouble for saying something about behind the meter generation or whatever it was. I can't remember what it was, but someone was mad.

Speaker #5: And we see a lot of money getting thrown at it. Takes a journeyman to make a journeyman. I'll say it again. It takes multi-years and the more years under their belt, the better they are.

Speaker #5: Look, the faster you can go right now in generation, people are going to buy it. But over time, you're going to try to connect to the grid.

Speaker #5: The more productive. So I think when we look at it, no oversupply, the bottlenecks would be generation, to some degree. And I know the generation is going to say it's EPC.

Speaker #5: It balances things out. And so utilities do it much better than anyone. They've been doing it for decades. So that bottleneck of that queue is extremely important.

Speaker #5: So yeah, look, some of it's technical. It is difficult to have the capacity to build combined cycles at the levels that everyone wants to build a mountain as quick as they want to build a mountain.

Speaker #5: What does it take to get to the queue? It takes generation of substation. But we're very much involved in both sides of that. And I do think that would be the bottleneck is getting to the what I would consider utility-scale generation.

Speaker #5: We're working hard to build those capabilities internally. We've done a real nice job. We have what I consider a significant business in front of us in the generation side.

Speaker #5: And they're moving very fast. So we're working with them all over the place and I do believe utilities are in a growth mode. They've been under-invested in for a while on generation.

Speaker #5: So that's organic growth for us. We really like where it's going. And we put in the resources in it and the training and getting great people here that want to work for Quanta.

Speaker #5: And you're starting to see that significant investment and it's if you start an engine today, if you order an engine today, you're five years out, probably six, where you get them built.

Speaker #5: So real happy with both sides of that. There is bottlenecks here or there. I do think for the most part, most data centers want to go back to the grid at some point.

Speaker #5: So it just shows you the longevity. And I'm sure I didn't listen to you's call, but I'm confident Renova had a really nice book and it's going to continue for a bit here.

Speaker #5: So we're super happy with where we sit.

Speaker #5: And not to say that last time I got in trouble for saying something about neither behind the meter generation or whatever it was. I can't remember what it was, but someone was mad.

Speaker #1: Your next question will come from Andy Kaplowitz with Citigroup. Please unmute and ask your question.

Speaker #5: Look, the faster you can go right now in generation, people are going to buy it. But over time, you're going to try to connect to the grid, to balance these things out.

Speaker #4: Hey, good morning, everyone. Duke, you just added like 10% more employees to the Quantum family again in one quarter. Through acquisitions, I know how you're going to answer this question, but I'll ask it anyway.

Speaker #5: And so utilities do it much better than anyone. They've been doing it for decades. So that bottleneck of that queue is extremely important. What does it take to get to the queue?

Speaker #4: At some point, do you worry about the acquisition flywheel moving too fast? And maybe it could hurt underlying performance or alternatively, can you keep the pace of the recent acquisition trajectory that you've had over the last few years up?

Speaker #5: It takes generation of substation. But we're very much involved in both sides of that. And I do think that would be the bottleneck that's getting to the what I would consider utility skill generation.

Speaker #4: Is it obviously has been a significant acceleration?

Speaker #5: Yeah, that's a good question. We're buying great companies. I mean, one of them was over 100 years old, maybe two. We're not passing on great family businesses, great management teams.

Speaker #5: And they're moving very fast. So we're working with them all over the place. And I do believe utilities are in a growth mode. They've been underinvested in for a while on generation.

Speaker #5: And you're starting to see that significant investment. And it's if you start an engine today, if you order an engine today, you're five years out.

Speaker #5: It'll depend on the management teams. Do they fit here? We're super excited with the ones we bought. A lot of that too is, I mean, I would tell you a couple of them, we had talked to for 36 months maybe, maybe longer, maybe five years, about acquisitions.

Speaker #5: Probably six before you get them built. So it just shows you the longevity. And I'm sure I didn't listen to Jay's call, but I'm confident Renova had a really nice book and it's going to continue for a bit here.

Speaker #5: So we're super happy with where we sit.

Speaker #5: We just can't tell you when exactly how that's going to work out. Last quarter, we did zero. This quarter, we did four. We're not seeing shortage of people wanting to sell their businesses here.

Speaker #1: Your next question will come from Andy Kaplowitz with Citigroup. Please unmute and ask your question.

Speaker #5: I mean, I do believe culturally, it matters we view that more so than anything else because if we continue down the path, the cultural path, we get the synergies.

Speaker #6: Good morning, everyone. Duke, you just added like 10% more employees to the Quanta family again in one quarter. Through acquisitions, I know how you're going to answer this question, but I'll ask it anyway.

Speaker #5: They want to work together. People want to work here. We're creating great jobs. I mean, we have a lot of adjournment here that are executive vice presidents, presidents, CEOs.

Speaker #6: At some point, do you worry about the acquisition flywheel moving too fast and maybe it could hurt underlying performance? Or alternatively, can you keep the pace of the recent acquisition trajectory that you've had over the last few years off as it obviously has been a significant acceleration?

Speaker #5: They're all over. And we have a path for craft. Here. That's remarkable. So I do believe if you want to exit your business, Quantum makes tons of sense for you.

Speaker #5: Yeah, that's a good question. We're buying great companies. I mean, one of them was over 100 years old, maybe two. We're not passing on great family businesses, great management teams.

Speaker #5: We're excited about that. I do think creating those opportunities, watching craft do very well. We push equity down to 10,000 plus people. I pinch myself on how lucky we are to be in the space we're in and be able to do the things we can do for craft.

Speaker #5: It'll depend on the management teams. Do they fit here? We're super excited with the ones we bought. A lot of that too is I mean, I would tell you a couple of them, we had talked to for 36 months maybe, maybe longer, maybe five years, about acquisitions.

Speaker #5: So I'm super happy. And that's why people want to sell their business here.

Speaker #1: Your next question will come from Chris Song with Wolf Research. Please unmute and ask your question.

Speaker #6: Hey, good morning, guys. Next quarter. Just Sunday acquisitions. Can you give us the annualized EBITDA run rate or the purchase multiple you underwrote? Just the 120 to 140 contribution seems like it's just partial year and I just want to make sure we're comparing it correctly with the purchase price.

Speaker #5: We just can't tell you when exactly how that's going to work out. Last quarter, we did zero. This quarter, we did four. We're not seeing shortages of people wanting to sell their businesses here.

Speaker #5: I mean, I do believe culturally, it matters we view that more so than anything else because if we continue down the path, the cultural path, we get the synergies.

Speaker #6: Thanks.

Speaker #2: Yeah. I think you can just do the math. It's about six, seven months worth of what we gave you. So you could annualize it based on just that.

Speaker #5: They want to work together. People want to work here. We're creating great jobs. I mean, we have a lot of journeymen here that are executive vice presidents, CEOs.

Speaker #2: And I can give you a good sense of the run rate.

Speaker #1: Our last question comes from Alexa Petric Brenow from Goldman Sachs. Please unmute and ask your question.

Speaker #5: They're all over. And we have a path for craft here. That's remarkable. So I do believe if you want to exit your business, Quanta makes tons of sense for you.

Speaker #7: Hey, good morning, team. And thanks for taking our question. The guidance revision this quarter was notable. Can you just talk more about the drivers of that revision?

Speaker #5: I'm more excited about that. I do think creating those opportunities, watching craft do very well. We push equity down to 10,000 plus people. I pinch myself on how lucky we are to be in the space we're in and be able to do the things we can do for craft.

Speaker #7: What are you seeing in the market and in your backlog that gives you confidence in this new guide?

Speaker #5: Yeah. I mean, look, you can see the headcounts moving up. You can see both electric and gas moving up. Obviously, the contribution from electric, it's a bigger segment.

Speaker #5: So I'm super happy. And that's why people want to sell their business here.

Speaker #5: It's going to be up. So it was broad-based. I think the synergies that we have and the things that we saw coming together, we're doing a lot of balance of plant work on the data side, technology side, but it's not just data centers.

Speaker #1: Your next question will come from Chris Song with Wolf Research. Please unmute and ask your question.

Speaker #7: Hey, good morning, guys. Nice quarter. Just Sunday acquisitions. Can you give us the annualized EBITDA run rate or the purchase portfolio you underwrote? Just the 120 to 140 contribution seems like it's just partial year.

Speaker #5: I mean, we're involved in all kinds of manufacturing, lily plant, starting, all kinds of different things. Tesla's got plenty going on. Onboarding manufacturing, I mean, kind of onshoring manufacturing.

Speaker #7: And I just want to make sure we're comparing it correctly with the purchase price. Thanks.

Speaker #5: Medical across the board, we're picking up on both sides of that. So I would say our T&D business is growing nicely. Our renewable business, I know everyone was worried about that for a while.

Speaker #2: Yeah, I think you can just do the math. It's about six, seven months worth of what we gave you. So you could annualize it based on just that.

Speaker #2: And I can give you a good sense of the run rate.

Speaker #5: We're setting records there. So super happy with what they're doing. So broad-based growth, we will stack both generation and large transmission on the business.

Speaker #1: Our last question comes from Alexa Petric Breno. From Goldman Sachs. Please unmute and ask your question.

Speaker #5: And that'll be the outward growth in foreseeable future. So you'll start to see that stacking effect as well. We're not on a lot of big large transmission.

Speaker #8: Hey, good morning team, and thanks for taking our question. The guidance revision this quarter was notable. Can you just talk more about the drivers of that revision?

Speaker #8: What are you seeing in the market and in your backlog that gives you confidence in this new guide?

Speaker #5: We're cleaning a few of them up and then we're starting a few of them ourselves. But in general, I do think that stacking hasn't started yet and it's going to.

Speaker #5: Yeah, I mean, look, you can see the headcounts moving up. You can see both electric and gas moving up. Obviously, the contribution from electric, it's a bigger segment.

Speaker #5: I think it's probably second half of '27. You'll start to see us go to the field in a meaningful way and that'll stack on out through the decade.

Speaker #5: It's going to be up. So it was broad-based. I think the synergies that we have and the things that we saw coming together, we're doing a lot of balance of plant work on the data side and technology side, but it's not just data centers.

Speaker #5: So we're happy with that.

Speaker #1: We have no more questions at this time. I will pass it back to the Quanta team for closing remarks.

Speaker #5: I mean, we're involved in all kinds of manufacturing, lily plants, starting, all kinds of different things. Tesla's got plenty going on. Onboarding, manufacturing, I mean, kind of onshoring manufacturing.

Speaker #5: Thank you. I want to again thank the 85,000 plus men and women in the field, their sacrifices to build the infrastructure tomorrow is noted and we thank them.

Speaker #5: So and I also want to thank you for participating in our conference call. We appreciate your questions and ongoing interest in Quantum services. Thank you.

Speaker #5: Medical across the board, we're picking up on both sides of that. So I would say our T&D business is growing nicely. Our renewable business, I know everyone was worried about that for a while.

Speaker #5: We're setting records there. So super happy with what they're doing. So broad-based growth, we will stack both generation and large transmission on the business.

Speaker #5: And that'll be the outward growth in foreseeable future. So you'll start to see that stacking effect as well. We're not on a lot of big large transmission.

Speaker #5: We're cleaning a few of them up and then we're starting a few of them ourselves. But in general, I do think that stacking hasn't started yet and it's going to.

Speaker #5: I think it's probably second half of '27. You'll start to see us go to the field in a meaningful way and that'll stack on out through the decade.

Speaker #5: So we're happy with that.

Speaker #1: We have no more questions at this time. I will pass it back to the Quanta team for closing remarks.

Speaker #5: Thank you. I want to again thank the 85,000 plus men and women in the field. Their sacrifices to build the infrastructure tomorrow is noted and we thank them.

Speaker #5: So and I also want to thank you for participating in our conference call. We appreciate your questions and ongoing interest in Quanta services. Thank you.