Aecom 2026 Q3 Earnings Call
Review the key takeaways and the transcript of this earnings call.
- The company's backlog increased 13% to a new all-time high with record quarterly wins and a 1.6 book to burn across the business, including 1.8 times in the Americas year to date.
- Net service revenue (NSR) in the design business increased by 5%, led by 6% growth in the Americas and 4% growth internationally, driven by the UK and Australia.
- The company recorded a $337 million pre-tax charge primarily due to delays in a large construction management project, pushing its completion from Q1 to Q2 of fiscal 2027.
- Adjusted EBITDA and EPS improved year over year by 5% and 11%, respectively, excluding the charge, with margin expansion in the international segment.
- Free cash flow was positive at $55 million despite headwinds from the construction management projects.
- The Americas segment NSR declined 29% mainly due to the construction management charge, while the design business grew 6% adjusted for one less working day.
- The international segment NSR increased 4%, with strong growth in Australia and the UK, and backlog up 28% year over year.
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Transcript
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Hello, everyone. Thank you for joining us, and welcome to AECOM's third quarter 2026 earnings conference call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, press star one again. I will now hand the conference over to Will Gabrielski, Senior Vice President of Finance and Investor Relations.
You may begin. Thank you, operator.
I would like to direct your attention to the safe harbor statement on page one of today's presentation. Today's discussion contains forward-looking statements about future business and financial expectations. Actual results may differ significantly from those projected in today's forward-looking statements due to various risks and uncertainties, including the risks described in our periodic reports filed with the SEC. Except as required by law, we undertake no obligation to update our forward-looking statements. We use certain non-GAAP financial measures in our presentation. The appropriate GAAP reconciliations are incorporated into our materials, which are posted to our website. Growth rates are presented on a year-over-year basis unless otherwise noted. Any references to segment margins or segment adjusted operating margins will reflect the performance for the Americas and International segments.
When discussing revenue and revenue growth, we will refer to net service revenue, or NSR, which is defined as revenue excluding pass-through revenue. NSR growth rates are presented on a constant currency basis unless otherwise noted. Today's remarks will focus on continuing operations. On today's call, Troy Rudd, our Chief Executive Officer, will review key developments and accomplishments this quarter, as well as our outlook for the business. Lara Poloni, our President, will discuss key trends across our markets, and Gaurav Kapoor, our Chief Financial and Operations Officer, will review our financial performance and outlook in greater detail. We will conclude with a question and answer session. With that, I will turn the call over to Troy.
Troy? Thank you, Will, and thank you all for joining us today.
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