Willdan Group (WLDN) Q2 2025 earnings summary

Executive summary

• Achieved record Q2 and first half 2025 results, with Q2 net revenue up 31% and contract revenue up 23% year-over-year, driven by strong demand across all business lines and recent acquisitions.

• Net income surged 236% to $15.4 million in Q2 2025, with adjusted EBITDA up 71% to $21.9 million and gross margin improving to 39.4%.

• Six-month net income rose 167% to $20.1 million, reflecting consistent execution, new contract wins, and strategic acquisitions.

• Performance was strong across Energy and Engineering and Consulting segments, supported by commercial, utility, and government demand.

• Raised full-year 2025 financial targets due to strong momentum and favorable industry trends.

Financial highlights

• Q2 2025 contract revenue: $173.5M (+23% YoY); net revenue: $95.0M (+31.1% YoY); gross profit: $68.3M; gross margin: 39.4%.

• Q2 net income: $15.4M (+236% YoY); adjusted EBITDA: $21.9M (+71% YoY); GAAP EPS: $1.03 (up from $0.33); adjusted EPS: $1.50.

• Six-month contract revenue: $325.9M (+23.7% YoY); net revenue: $180.3M (+27.5% YoY); net income: $20.1M (+167% YoY); adjusted EBITDA: $36.4M (+52.3% YoY).

• Free cash flow for the first half was $24M; cash flow from operations was $28.7M; cash and equivalents at period end: $32.3M.

• Net debt at $28M; net debt-to-adjusted EBITDA ratio of 0.4x; debt-to-equity ratio: 0.22.

Outlook and guidance

• Full-year 2025 net revenue expected between $340M–$350M; adjusted EBITDA $70M–$73M; adjusted EPS $3.50–$3.65.

• Q3 adjusted EBITDA expected similar to Q2; Q4 slightly less than Q3.

• Guidance assumes 15.1M diluted shares, 15% effective tax rate, and excludes impact of future acquisitions.

• Management expects continued strong demand in both segments, supported by acquisitions and robust utility and government spending.

• Sufficient liquidity is anticipated for at least the next 12 months, with available borrowing capacity and cash on hand.