ABM Industries (ABM) Q4 2025 earnings summary

Executive summary

• Achieved record quarterly revenue of $2.3 billion in Q4 2025, up 5.4% year-over-year with 4.8% organic growth, and full-year revenue of $8.7 billion, up 5% year-over-year, with all segments contributing to growth.

• Net income for Q4 was $34.8 million ($0.56 per diluted share), reversing a prior-year loss, and adjusted EPS was $0.88; full-year net income was $162.4 million and adjusted EPS was $3.44.

• Free cash flow in Q4 was $112.7 million, a significant improvement from the prior year.

• Announced the acquisition of WGNSTAR, expanding technical workforce solutions in the semiconductor sector, expected to close in Q1/Q2 2026.

• Record new sales bookings of $1.9 billion, up 12% over 2024, and a major new Aviation contract win to start in early 2026.

Financial highlights

• Adjusted EBITDA for Q4 was $124.2 million, margin 5.6%; full year adjusted EBITDA was $496.6 million, margin 5.9%.

• Adjusted net income for Q4 was $54.7 million, flat year-over-year due to a $15.8 million negative impact from prior-year self-insurance adjustments and higher interest expense.

• Cash flow from operations reached $133.4 million in Q4 2025.

• Repurchased 2.6 million shares in FY2025 for $121.3 million, reducing share count by 4%.

• Board approved a 9% increase in the quarterly dividend to $0.29 per share, marking 58 consecutive years of dividend increases.

Outlook and guidance

• Fiscal 2026 organic revenue growth expected at 3%-4%, with total growth of 4%-5% including WGNSTAR.

• Adjusted EPS guidance for 2026 is $3.85-$4.15, before any impact from prior-year self-insurance adjustments.

• Segment operating margin expected between 7.8% and 8% for 2026; interest expense forecasted at $95-$105 million and normalized tax rate at 29%-30%.

• Free cash flow before transformation and integration costs, earn-outs, and restructuring projected at $250 million.

• WGNSTAR acquisition expected to be accretive in 2027 and beyond.