Record Quarterly Revenues of $737.6 Million, a 34.6% Increase from a Year Ago
Quarterly Adjusted EBITDA (non-GAAP) Increased 53% from Prior Year(1)
Record Total Backlog and Awards of $3.7 Billion, 49% Increase from a Year Ago, with Robust Q4 Book-to-Bill of 1.9x
Tuck-In Acquisition of Seattle Area-Based Engineering Firm
Establish First Quarter 2026 Guidance for Revenue of $925 Million - $950 Million and Non-GAAP Adjusted EBITDA of $90 Million - $100 Million
Raise Full Year 2026 Guidance for Revenue to $3.7 Billion - $3.9 Billion and Non-GAAP Adjusted EBITDA of $400 Million - $430 Million
SAN JOSE, Calif., March 27, 2026 (GLOBE NEWSWIRE) -- Legence Corp. (Nasdaq: LGN) ("Legence" or the "Company") today reported financial results for the fourth quarter and year ended December 31, 2025.
"Our fourth quarter 2025 performance punctuates a milestone year for Legence," said Jeff Sprau, Chief Executive Officer of Legence. "We achieved record quarterly revenues which increased by 34.6% year over year, driven almost entirely by organic growth. Total backlog and awarded contracts surged by 49% to a record $3.7 billion, led by Data Centers & Technology, along with State & Local Government and Life Science & Healthcare end markets. This exceptional performance is made possible by the dedication of our outstanding team of skilled labor and engineering professionals, who continue to execute at the highest and safest level for our customers.
Our latest results speak to the demand momentum for mission-critical building systems, which we anticipate will continue throughout 2026 and beyond. The combination of robust industry tailwinds, our record backlog, and the strategic addition of The Bowers Group, Inc. ("Bowers"), along with several recent tuck-in acquisitions over the past year, positions Legence for an exciting new phase of growth."
Fourth Quarter and Full Year 2025 Consolidated Results:
Revenues for the fourth quarter 2025 totaled $737.6 million, an increase of 34.6% from $548.2 million for the fourth quarter 2024. Gross profit for the fourth quarter 2025 was $147.5 million with gross margin of 20.0%, compared to gross profit of $112.9 million and gross margin of 20.6% for the fourth quarter 2024. Excluding the impact of stock-based compensation related to legacy profit interest units paid for by entities outside of Legence, we generated non-GAAP Adjusted Gross Profit of $156.6 million and non-GAAP Adjusted Gross Margin of 21.2% for the fourth quarter 2025, compared to non-GAAP Adjusted Gross Profit of $112.3 million and non-GAAP Adjusted Gross Margin of 20.5% for the fourth quarter 2024. Net loss attributable to Legence for the fourth quarter 2025 was $32.7 million, or $(0.55) per diluted share, compared to a net loss of $18.7 million for the fourth quarter 2024. Non-GAAP Adjusted EBITDA for the fourth quarter 2025 was $87.0 million, an increase of 53.2% from $56.8 million for the fourth quarter 2024. Refer to "Non-GAAP Financial Measures" for definitions of Adjusted Gross Profit, Adjusted Gross Margin and Adjusted EBITDA and a reconciliation of each to the most directly comparable GAAP measure.
Legence Corp.
Consolidated
Results
($ in thousands) Three Months Ended December 31,
------------------------------------------
Year over Year
2025 2024 Change
--------------- --------------- -------------------
$ % $ % $ %
-------- ---------- -------- ---------- --------- --------
Revenues:
Engineering &
Consulting $172,580 23.4% $156,872 28.6% $ 15,708 10.0%
Installation &
Maintenance 565,062 76.6% 391,343 71.4% 173,719 44.4%
------- ------ ------- ------ -------
Consolidated
Revenues $737,642 100.0% $548,215 100.0% $189,427 34.6%
------- ------ ------- ------ -------
Three Months Ended December 31,
------------------------------------------
Year over Year
2025 2024 Change
--------------- --------------- -------------------
$ % Margin $ % Margin $ %
-------- ---------- -------- ---------- --------- --------
Gross Profit:
Engineering &
Consulting $ 47,779 27.7% $ 51,518 32.8% $ (3,739) (7.3)%
Installation &
Maintenance 99,709 17.6% 61,423 15.7% 38,286 62.3%
------- ------- -------
Consolidated
Gross Profit $147,488 20.0% $112,941 20.6% $ 34,547 30.6%
------- ------- -------
Non-GAAP
Adjusted
Gross Profit $156,560 21.2% $112,315 20.5% $ 44,245 39.4%
------- ------- -------
Non-GAAP Adjusted
EBITDA $ 86,981 11.8% $ 56,788 10.4% $ 30,193 53.2%
Revenues for the full year 2025 totaled $2.6 billion, an increase of 21.5% from $2.1 billion for the full year 2024. Gross profit for the full year 2025 was $535.9 million with gross margin of 21.0%, compared to gross profit of $430.8 million and gross margin of 20.5% for the full year 2024. Excluding the impact of stock-based compensation related to legacy profit interest units paid for by entities outside of Legence, we generated non-GAAP Adjusted Gross Profit of $549.7 million and non-GAAP Adjusted Gross Margin of 21.6% for the full year 2025, compared to non-GAAP Adjusted Gross Profit of $432.1 million and non-GAAP Adjusted Gross Margin of 20.6% for the full year 2024. Net loss attributable to Legence for the full year 2025 was $59.8 million, compared to a net loss of $28.6 million for the full year 2024. Non-GAAP Adjusted EBITDA for the full year 2025 was $298.8 million, an increase of 30.1% from $229.6 million for the full year 2024. Refer to "Non-GAAP Financial Measures" for definitions of Adjusted Gross Profit, Adjusted Gross Margin and Adjusted EBITDA and a reconciliation of each to the most directly comparable GAAP measure.
Legence Corp.
Consolidated
Results
($ in thousands) Twelve Months Ended December 31,
----------------------------------------------
Year over Year
2025 2024 Change
----------------- ----------------- ------------------
$ % $ % $ %
---------- ---------- ---------- ---------- -------- --------
Revenues:
Engineering &
Consulting $ 726,293 28.5% $ 601,602 28.7% $124,691 20.7%
Installation &
Maintenance 1,824,198 71.5% 1,497,000 71.3% 327,198 21.9%
--------- ------ --------- ------ -------
Consolidated
Revenues $2,550,491 100.0% $2,098,602 100.0% $451,889 21.5%
--------- ------ --------- ------ -------
Twelve Months Ended December 31,
----------------------------------------------
Year over Year
2025 2024 Change
----------------- ----------------- ------------------
$ % Margin $ % Margin $ %
---------- ---------- ---------- ---------- -------- --------
Gross Profit:
Engineering &
Consulting $ 238,869 32.9% $ 205,085 34.1% $ 33,784 16.5%
Installation &
Maintenance 297,056 16.3% 225,682 15.1% 71,374 31.6%
--------- --------- -------
Consolidated
Gross Profit $ 535,925 21.0% $ 430,767 20.5% $105,158 24.4%
--------- --------- -------
Non-GAAP
Adjusted
Gross Profit $ 549,665 21.6% $ 432,083 20.6% $117,582 27.2%
--------- --------- -------
Non-GAAP Adjusted
EBITDA $ 298,825 11.7% $ 229,625 10.9% $ 69,200 30.1%
Engineering & Consulting Segment Results:
Engineering & Consulting segment revenue for the fourth quarter 2025 totaled $172.6 million, an increase of 10.0% from $156.9 million for the fourth quarter 2024, driven by higher demand for Program & Project Management services, primarily from education and other clients including hospitality & entertainment, partially offset by modestly lower revenue from our Engineering & Design service line, primarily from education and data centers & technology clients.
Engineering & Consulting segment gross profit for the fourth quarter 2025 totaled $47.8 million, a decrease of 7.3% from $51.5 million for the fourth quarter 2024. Excluding the impact of stock-based compensation related to legacy profit interest units paid for by entities outside of Legence, we generated non-GAAP Adjusted Gross Profit of $53.4 million and non-GAAP Adjusted Gross Margin of 30.9% for the fourth quarter 2025, compared to non-GAAP Adjusted Gross Profit of $51.2 million and non-GAAP Adjusted Gross Margin of 32.6% for the fourth quarter 2024. Refer to "Non-GAAP Financial Measures" for definitions of Adjusted Gross Profit and Adjusted Gross Margin and a reconciliation of each to the most directly comparable GAAP measure. The increase in non-GAAP Adjusted Gross Profit was driven by revenue growth, partially offset by lower non-GAAP Adjusted Gross Margin. The decrease in non-GAAP Adjusted Gross Margin was primarily driven by a higher mix of revenue from the Program & Project Management service line and lower Program & Project Management margins.
Engineering & Consulting
Segment Results
($ in thousands) Three Months Ended December 31,
Year over Year
2025 2024 Change
------------------
$ % $ % $ %
-------- ---------- -------- ---------- -------- --------
Segment Revenues:
Engineering &
Design $100,848 58.4% $101,583 64.8% $ (735) (0.7)%
Program & Project
Management 71,732 41.6% 55,289 35.2% 16,443 29.7%
Engineering &
Consulting
Revenues $172,580 100.0% $156,872 100.0% $15,708 10.0%
------- ------ ------- ------ ------
Three Months Ended December 31,
Year over Year
2025 2024 Change
--------------- --------------- ------------------
$ % Margin $ % Margin $ %
-------- ---------- -------- ---------- -------- --------
Engineering &
Consulting Gross
Profit $ 47,779 27.7% $ 51,518 32.8% $(3,739) (7.3)%
Engineering &
Consulting
Non-GAAP Adjusted
Gross Profit 53,405 30.9% 51,185 32.6% 2,220 4.3%
Engineering & Consulting segment revenue for the full year 2025 totaled $726.3 million, an increase of 20.7% from $601.6 million for the full year 2024. Approximately 80% of the revenue increase resulted from the full year impact of acquisitions completed in 2024 and partial impact of an acquisition completed in late 2025. Our Engineering & Design service line revenue increased by 22.8%, driven primarily from life sciences & healthcare and other clients including hospitality & entertainment. Our Program & Project Management service line revenue increased by 17.9%, driven primarily from other clients including hospitality & entertainment.
Engineering & Consulting segment gross profit for the full year 2025 totaled $238.9 million, an increase of 16.5% from $205.1 million for the full year 2024. Excluding the impact of stock-based compensation related to legacy profit interest units paid for by entities outside of Legence, we generated non-GAAP Adjusted Gross Profit of $247.3 million and non-GAAP Adjusted Gross Margin of 34.0% for the full year 2025, compared to non-GAAP Adjusted Gross Profit of $205.9 million and non-GAAP Adjusted Gross Margin of 34.2% for the full year 2024. Refer to "Non-GAAP Financial Measures" for definitions of Adjusted Gross Profit and Adjusted Gross Margin and a reconciliation of each to the most directly comparable GAAP measure. The increase in non-GAAP Adjusted Gross Profit was driven by revenue growth, partially offset by modestly lower non-GAAP Adjusted Gross Margin. The decline in non-GAAP Adjusted Gross Margin was driven by lower Engineering & Design margin, primarily from life sciences & healthcare, state & local government and education clients.
Engineering & Consulting
Segment Results
($ in thousands) Twelve Months Ended December 31,
Year over Year
2025 2024 Change
$ % $ % $ %
--------- ---------- -------- ---------- -------- --------
Segment Revenues:
Engineering &
Design $ 425,014 58.5% $345,977 57.5% $ 79,037 22.8%
Program & Project
Management 301,279 41.5% 255,625 42.5% 45,654 17.9%
-------- ------ ------- ------ -------
Engineering &
Consulting
Revenues $ 726,293 100.0% $601,602 100.0% $124,691 20.7%
-------- ------ ------- ------ -------
Twelve Months Ended December 31,
Year over Year
2025 2024 Change
---------------- --------------- ------------------
$ % Margin $ % Margin $ %
--------- ---------- -------- ---------- -------- --------
Engineering &
Consulting Gross
Profit $ 238,869 32.9% $205,085 34.1% $ 33,784 16.5%
Engineering &
Consulting
Non-GAAP Adjusted
Gross Profit 247,282 34.0% 205,922 34.2% 41,360 20.1%
Installation & Maintenance Segment Results:
Installation & Maintenance segment revenue for the fourth quarter 2025 totaled $565.1 million, an increase of 44.4% from $391.3 million for the fourth quarter 2024. The increase was driven by robust demand for our Installation & Fabrication services, primarily from data centers & technology and life sciences & healthcare clients, partially offset by lower revenue from mixed-use and other clients. Additionally, the increase in Maintenance & Service revenue was primarily from data centers & technology clients.
Installation & Maintenance segment gross profit for the fourth quarter 2025 totaled $99.7 million, an increase of 62.3% from $61.4 million for the fourth quarter 2024. Excluding the impact of stock-based compensation related to legacy profit interest units paid for by entities outside of Legence, we generated non-GAAP Adjusted Gross Profit of $103.2 million and non-GAAP Adjusted Gross Margin of 18.3% for the fourth quarter 2025, compared to non-GAAP Adjusted Gross Profit of $61.1 million and non-GAAP Adjusted Gross Margin of 15.6% for the fourth quarter 2024. Refer to "Non-GAAP Financial Measures" for definitions of Adjusted Gross Profit and Adjusted Gross Margin and a reconciliation of each to the most directly comparable GAAP measure. The increase in non-GAAP Adjusted Gross Profit was primarily driven by revenue growth, as well as higher non-GAAP Adjusted Gross Margin. The increase in non-GAAP Adjusted Gross Margin was primarily due to higher margins in the Installation & Fabrication service line, driven by strong project execution, partially offset by a higher mix of revenue from the Installation & Fabrication service line.
Installation & Maintenance
Segment Results
($ in thousands) Three Months Ended December 31,
------------------------------------------ ------------------
Year over Year
2025 2024 Change
------------------
$ % $ % $ %
-------- ---------- -------- ---------- -------- --------
Segment Revenues:
Installation &
Fabrication $475,406 84.1% $310,269 79.3% $165,137 53.2%
Maintenance &
Service 89,656 15.9% 81,074 20.7% 8,582 10.6%
------- ------ ------- ------ -------
Installation &
Maintenance
Revenues $565,062 100.0% $391,343 100.0% $173,719 44.4%
------- ------ ------- ------ -------
Three Months Ended December 31,
------------------
Year over Year
2025 2024 Change
--------------- --------------- ------------------
$ % Margin $ % Margin $ %
-------- ---------- -------- ---------- -------- --------
Installation &
Maintenance Gross
Profit $ 99,709 17.6% $ 61,423 15.7% $ 38,286 62.3%
Installation &
Maintenance
Non-GAAP Adjusted
Gross Profit 103,155 18.3% 61,130 15.6% 42,025 68.7%
Installation & Maintenance segment revenue for the full year 2025 totaled $1.8 billion, an increase of 21.9% from $1.5 billion for the full year 2024. The increase was driven by greater demand for Installation & Fabrication services, primarily from data centers & technology and life sciences & healthcare clients, partially offset by lower revenue from mixed-use and other clients including hospitality & entertainment. Additionally, the increase in Maintenance & Service revenue was primarily from data centers & technology and life sciences & healthcare clients, partially offset by other clients.
Installation & Maintenance segment gross profit for the full year 2025 totaled $297.1 million, an increase of 31.6% from $225.7 million for the full year 2024. Excluding the impact of stock-based compensation related to legacy profit interest units paid for by entities outside of Legence, we generated non-GAAP Adjusted Gross Profit of $302.4 million and non-GAAP Adjusted Gross Margin of 16.6% for the full year 2025, compared to non-GAAP Adjusted Gross Profit of $226.2 million and non-GAAP Adjusted Gross Margin of 15.1% for the full year 2024. Refer to "Non-GAAP Financial Measures" for definitions of Adjusted Gross Profit and Adjusted Gross Margin and a reconciliation of each to the most directly comparable GAAP measure. The increase in non-GAAP Adjusted Gross Profit was primarily driven by revenue growth, as well as higher non-GAAP Adjusted Gross Margin. The increase in non-GAAP Adjusted Gross Margin was primarily due to higher margins in the Installation & Fabrication service line, driven by strong project execution, partially offset by a higher mix of revenue from Installation & Fabrication service line.
Installation & Maintenance
Segment Results
($ in thousands) Twelve Months Ended December 31,
----------------------------------------------
Year over Year
2025 2024 Change
$ % $ % $ %
---------- ---------- ---------- ---------- -------- --------
Segment Revenues:
Installation &
Fabrication $1,493,830 81.9% $1,183,750 79.1% $310,080 26.2%
Maintenance &
Service 330,368 18.1% 313,250 20.9% 17,118 5.5%
--------- ------ --------- ------ -------
Installation &
Maintenance
Revenues $1,824,198 100.0% $1,497,000 100.0% $327,198 21.9%
--------- ------ --------- ------ -------
Twelve Months Ended December 31,
Year over Year
2025 2024 Change
----------------- -----------------
$ % Margin $ % Margin $ %
---------- ---------- ---------- ---------- -------- --------
Installation &
Maintenance Gross
Profit $ 297,056 16.3% $ 225,682 15.1% $ 71,374 31.6%
Installation &
Maintenance
Non-GAAP Adjusted
Gross Profit 302,383 16.6% 226,161 15.1% 76,222 33.7%
Backlog and Awarded Contracts
Backlog and awarded contracts totaled $3.7 billion at December 31, 2025, an increase of 48.6% from $2.5 billion at December 31, 2024. The consolidated book-to-bill ratio for the three-month and twelve-month period ended December 31, 2025 was 1.9x and 1.6x, respectively. Engineering & Consulting segment backlog and awarded contracts increased by 16.2% year over year, primarily from growth in the state & local government and life science & healthcare end markets, partially offset by a decline in the mixed-use end market. Installation & Maintenance segment backlog and awarded contracts increased by 65.8% year over year, primarily from strong growth in the data center & technology end market. Backlog and awarded contracts at December 31, 2025 exclude values from Bowers. The Company estimates backlog and awarded contracts for Bowers of approximately $1.5 billion at December 31, 2025.
Backlog and
Awarded
Contracts
($ in thousands)
Year over Year
As of December 31, Change
2025 2024 $ %
--------- --------- ---------- --------
Engineering &
Consulting $ 994,073 $ 855,784 $ 138,289 16.2%
Installation &
Maintenance 2,680,276 1,616,310 1,063,966 65.8%
--------- --------- ---------
Total Backlog
and Awarded
Contracts $3,674,349 $2,472,094 $1,202,255 48.6%
--------- --------- ---------
Book-to-bill ratio
for the three
months ended
December 31 1.9x 1.2x
Book-to-bill ratio
for the twelve
months ended
December 31 1.6x 1.3x
Acquisitions
On March 1, 2026, the Company completed the acquisition of Metrix Engineers LLC ("Metrix"). Founded in 2011, Metrix is a Renton, WA-based MEP engineering firm with a strong presence in the education end market in the Pacific Northwest. Total consideration for Metrix was approximately $30 million, of which less than 25% was paid in equity.
"The Metrix team is a great addition to our organization, within the Engineering & Consulting segment, and aligns well with our collaborative culture," said Jeff Sprau, Chief Executive Officer of Legence. "This acquisition adds scale to our engineering and consulting capabilities in the Pacific Northwest, a region known for innovation, diversifies our customer base and offers compelling cross selling opportunities. Metrix reflects our disciplined M&A approach which targets strategic opportunities that are expected to drive growth and enhance margins."
Balance Sheet
At December 31, 2025, the Company had cash and equivalents of approximately $230.2 million and total debt(2) of approximately $825.1 million. As a result, net leverage was 2.0 times, based on non-GAAP Adjusted EBITDA for the last 12 months ended December 31, 2025. Refer to "Non-GAAP Financial Measures" for a definition and calculation of net leverage. On January 2, 2026, the Company completed the acquisition of Bowers, which resulted in an upfront cash payment of $325 million (subject to customary adjustments), funded by a combination of cash on hand, a $200 million upsizing of the Company's term loan facility and borrowings under the Company's revolving line of credit. Borrowings under the revolving line of credit have since been repaid. In conjunction with the Bowers acquisition, the Company also issued approximately 2.55 million shares of the Company's Class A common stock. Legence will pay an additional approximately $50 million of deferred consideration at the end of 2026 in cash or shares of the Company's Class A common stock, or a combination, at the Company's discretion.
Guidance
Legence announces the following guidance for the first quarter of 2026:
-- Total revenues of $925 million to $950 million; and -- Non-GAAP adjusted EBITDA of $90 million to $100 million.
Legence revises guidance for full year 2026 as follows (which in both cases, reflects the expected results following the acquisition of Metrix and incorporates the previously-disclosed separate guidance for Bowers for full year 2026):
-- Total revenues of $3.7 billion to $3.9 billion, up from $3.5 billion to
$3.7 billion; and
-- Non-GAAP Adjusted EBITDA of $400 million to $430 million, up from $370
million to $400 million.
Conference Call
Legence will host a webcast and conference call to discuss its financial results on March 27, 2026 at 10:00 a.m. (Eastern Time). The webcast link to the call and the slide presentation to accompany the call remarks can be accessed on the Company's website at https://investors.wearelegence.com/. A replay of the webcast can be accessed through the same webcast link on the Company's website shortly after the call and will be available through April 27, 2026.
About Legence
Legence is a leading provider of engineering, consulting, installation, and maintenance services for mission-critical systems in buildings. The Company specializes in designing, fabricating, and installing complex HVAC, process piping, and other mechanical, electrical and plumbing (MEP) systems--enhancing energy efficiency, reliability, and sustainability in new and existing facilities. Legence also delivers long-term performance through strategic upgrades and holistic solutions. Serving some of the world's most technically demanding sectors, Legence counts over 60% of the Nasdaq-100 Index among its clients.
Forward-Looking Statements
Some of the information in this press release may contain "forward-looking statements." All statements, other than statements of historical fact included in this press release regarding our strategy, future operations, financial position and guidance, estimated revenues and losses, projected costs, prospects, plans and objectives of management, are forward-looking statements. When used in this press release, words such as "anticipate," "assume," "believe," "continue," "could," "estimate," "expect," "intend," "may," "could," "should," "plan, " "potential," "predict," "forecast," "budget," "project," "future," "will," "seek," "foreseeable," the negative versions of these words and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are not historical facts but rather are based on management's current belief, based on currently available information, as to the outcome and timing
of future events, and it is possible that the results described in this press release will not be achieved. Such statements are subject to risks, uncertainties and other factors, many of which are outside of the Company's control, that could cause actual results to differ materially from the results discussed in the forward-looking statements, including, but not limited to, changes to economic and regulatory conditions and other trends in the markets in which we operate; our ability to compete effectively in our target markets; the business plans or financial condition of our customers; the impact of acquired companies, including Bowers and Metrix, on our organization and the ability to recognize the anticipated benefits of such acquisitions; the regulations related to environmental, health and safety matters; the ability to receive necessary government permits and approvals; the future availability and price of materials and equipment necessary for the performance of our business; the risks associated with inflation, interest rates, recessionary economic conditions and commodity prices; the fact that we outsource various elements of the services we sell and use materials and equipment produced by third parties; our clients' reliance on third party financing; the recognition of all revenues from our backlog and awarded contracts; our receipt of all payments anticipated under awarded projects and customer contracts; the maintenance of safe work sites and equipment; restrictions imposed by our existing and any future indebtedness; our exposure to costs and liabilities under environmental, health and safety laws; misconduct and errors by employees, subcontractors, partners or third party service providers; and the other risks described under the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of the Company's final prospectus, dated December 11, 2025, filed with the Securities and Exchange Commission (the "SEC") pursuant to Rule 424(b)(4) of the Securities Act of 1933, as amended, on December 15, 2025 (the "Prospectus"), and our Annual Report on Form 10-K for the year ended December 31, 2025 (the "Annual Report") to be filed with the SEC, and in other documents the Company subsequently files from time to time with the SEC. Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified in their entirety by the statements in this section, to reflect events or circumstances after the date of this press release. New factors emerge from time to time, and it is not possible for the Company to predict all such factors. When considering these forward-looking statements, you should keep in mind the risk factors and other cautionary statements in the Prospectus and the Annual Report and in the Company's subsequent filings with the SEC. You are cautioned not to place undue reliance on these forward-looking statements.
Contact
Media: media@wearelegence.com
Investor Relations: ir@wearelegence.com
Legence Corp.
Condensed Consolidated Statements of Operations
(In thousands, except per share data) (Unaudited)
Three Months Ended
December 31, Year Ended December 31,
-------------------- --------------------------
2025 2024 2025 2024
------- ---------
Revenue $737,642 $548,215 $2,550,491 $2,098,602
Cost of revenue 590,154 435,274 2,014,566 1,667,835
------- ------- --------- ---------
Gross profit 147,488 112,941 535,925 430,767
Selling, general and
administrative 114,813 63,040 342,627 242,888
Depreciation and
amortization 24,746 26,415 100,365 97,153
Acquisition-related
costs 4,768 41 5,739 5,634
Gain on sale of
property and
equipment (127) -- (326) --
Goodwill impairment 24,966 17,804 24,966 17,804
Long-lived asset
impairment 2,415 -- 2,415 --
Equity in earnings
of joint venture (595) 68 (1,443) (3,063)
------- ------- --------- ---------
(Loss) income
from
operations (23,498) 5,573 61,582 70,351
Other expense
(income):
Interest expense
(including $1,564
and $3,353 for the
three months in
2025 and 2024,
respectively, and
$13,340 and $13,316
for the years ended
December 31, 2025
and 2024,
respectively, from
related parties) 13,550 26,217 101,778 91,609
Interest income (1,900) (1,108) (4,488) (5,464)
Loss on debt
extinguishment 966 -- 6,651 --
Credit agreement
amendment fees 3,312 3,682 6,302 7,801
Other expense
(income) , net 6,749 (39) 6,481 (473)
------- ------- --------- ---------
Total other
expense, net 22,677 28,752 116,724 93,473
------- ------- --------- ---------
Loss before
income tax (46,175) (23,179) (55,142) (23,122)
Income tax expense
(benefit) 8,499 (4,979) 22,161 4,521
------- ------- --------- ---------
Net loss (54,674) (18,200) (77,303) (27,643)
Net (loss) income
attributable to
noncontrolling
interests (21,953) 505 (17,523) 912
------- ------- --------- ---------
Net loss
attributable
to Legence $(32,721) $(18,705) $ (59,780) $ (28,555)
======= ======= ========= =========
Period from
September
12, 2025 to
December
31, 2025
Net loss per Class A
Common Stock--basic
and diluted $ (0.55) $ (0.57)
Weighted-average
Class A Common
Stock
outstanding--basic
and diluted 59,561 59,381
Legence Corp.
Condensed Consolidated Balance Sheets
(In thousands) (Unaudited)
December 31, 2025 December 31, 2024
------------------- ---------------------
Assets
Current assets:
Cash and cash equivalents 230,166 81,167
Accounts receivable, net 584,060 448,610
Contract assets, net 259,941 188,132
Prepaid expenses and other
current assets 36,179 38,506
-------------- --------------
Total current assets 1,110,346 756,415
Property and equipment, net 92,333 73,381
Operating lease right-of-use
assets (including $20,025
and $23,375 as of December
31, 2025 and 2024,
respectively, from related
parties) 117,139 90,922
Goodwill 764,336 781,194
Intangible assets, net 551,420 624,250
Other assets 43,822 26,338
-------------- --------------
Total assets $ 2,679,396 $ 2,352,500
============== ==============
Liabilities and Equity
Current liabilities:
Accounts payable 246,161 126,502
Accrued compensation and
benefits 68,064 54,601
Accrued and other current
liabilities 16,475 28,490
Contract liabilities 339,462 164,130
Current portion of operating
lease liabilities
(including $3,920 and
$3,654 as of December 31,
2025 and 2024,
respectively, from related
parties) 21,300 14,402
Current portion of long-term
debt 16,694 22,984
-------------- --------------
Total current
liabilities 708,156 411,109
Long-term debt, net of
current portion (including
$84,735 and $211,039 as of
December 31, 2025 and 2024,
respectively, from related
parties) 812,398 1,585,846
Operating lease liabilities,
net of current portion
(including $17,282 and
$20,960 as of December 31,
2025 and 2024,
respectively, from related
parties) 103,762 80,669
Tax receivable agreement
liability - related party 207,448 --
Deferred tax liabilities,
net 46,714 35,428
Other long-term liabilities 12,123 35,856
-------------- --------------
Total liabilities 1,890,601 2,148,908
Commitments and contingencies
Stockholders' equity /
Member's equity
Member's equity -- 443,738
Preferred stock, $0.01 par
value, 50,000,000 shares
authorized, no shares issued
or outstanding as of
December 31, 2025 -- --
Class A common stock, $0.01
par value, 1,000,000,000
shares authorized,
63,856,975 shares issued and
outstanding as of December
31, 2025 638 --
Class B common stock, $0.01
par value, 200,000,000
shares authorized,
41,479,954 shares issued and
outstanding as of December
31, 2025 415 --
Additional paid-in capital 701,791 --
Accumulated deficit (309,949) (250,169)
Accumulated other
comprehensive (loss)
income (698) 9,111
-------------- --------------
Total Legence
stockholders' equity /
Member's equity 392,197 202,680
Noncontrolling interests 396,598 912
-------------- --------------
Total stockholders'
equity / Member's
equity 788,795 203,592
-------------- --------------
Total liabilities and
stockholders' equity /
Member's equity $ 2,679,396 $ 2,352,500
============== ==============
Legence Corp.
Condensed Statements of Cash Flows
(In thousands) (Unaudited)
Year Ended December 31,
-----------------------------
2025 2024
---------
Cash flows from operating activities:
Net loss $ (77,303) $ (27,643)
Adjustments to reconcile net loss to
cash provided by operating activities:
Amortization of intangible assets 82,342 80,967
Depreciation of property and
equipment 31,946 29,882
Goodwill impairment 24,966 17,804
Long-lived asset impairment 2,415 --
Amortization of debt issuance costs
and discounts 3,480 5,052
Loss on debt extinguishment 6,651 --
Stock-based compensation 67,550 5,411
Deferred taxes 15,287 (13,704)
Tax receivable agreement liability
remeasurement 2,914 --
Equity in earnings of joint venture (1,443) (3,063)
Return on investment in joint venture 1,700 1,000
Operating lease right-of-use asset
lease expense 18,279 13,091
Other 1,158 3,749
Changes in operating assets and
liabilities:
Accounts receivable, net (130,070) 17,955
Contract assets (71,185) (50,995)
Prepaid expenses and other current
assets 2,929 4,498
Accounts payable 117,910 10,699
Accrued compensation and benefits 12,298 (2,778)
Accrued and other current liabilities (13,967) (36,638)
Contract liabilities 172,194 (14,507)
Operating lease liabilities, current
and long-term (15,280) (10,603)
Other long-term assets and
liabilities 2,102 (909)
--------- ---------
Cash provided by operating
activities 256,873 29,268
--------- ---------
Cash flows from investing activities:
Purchases of property and equipment (37,940) (19,008)
Consideration paid for acquisitions,
net of cash acquired (16,497) (225,246)
Proceeds from sale of property and
equipment 390 269
--------- ---------
Cash used in investing activities (54,047) (243,985)
--------- ---------
Cash flows from financing activities:
Term loan borrowings (including $2,968
and $103,500 for the years ended
December 31, 2025 and 2024,
respectively, from related parties) 59,636 565,000
Term loan payments (including $74,797
in 2025 to related parties) (852,214) (13,682)
Notes payable payments (7,878) (6,485)
Finance lease payments (3,843) (2,460)
Cash distributions to Legence Parent -- (301,614)
Cash contributions from Legence Parent -- 400
Proceeds from IPO, net of underwriting
discounts and commissions 780,243 --
Debt issuance costs (1,626) (1,495)
Payments for deferred offering costs (28,145) (196)
Payments of contingent consideration
(including ($20,663) for the year
ended December 31, 2024 from related
parties) -- (32,504)
--------- ---------
Cash (used in) provided by
financing activities (53,827) 206,964
--------- ---------
Increase (decrease) in cash and cash
equivalents 148,999 (7,753)
Cash and cash equivalents and restricted
cash, beginning of period 81,167 88,920
--------- ---------
Cash and cash equivalents, end of period $ 230,166 $ 81,167
========= =========
Non-GAAP Financial Measures
In addition to disclosing financial results calculated in accordance with U.S. generally accepted accounting principles ("GAAP"), our earnings release contains non-GAAP financial measures as described below.
Our non-GAAP financial measures may not be comparable to similarly titled measures used by other companies, have limitations as analytical tools and should not be considered in isolation, or substitutes for analysis of our operating results as reported under GAAP. Additionally, we do not consider our non-GAAP financial measures superior to, or a substitute for, the equivalent measures calculated and presented in accordance with GAAP.
In addition, this press release includes certain projections of the non-GAAP financial measure Adjusted EBITDA. Due to the high variability and difficulty in making accurate forecasts and projections of some of the information excluded from these projected measures, together with some of the excluded information not being ascertainable or accessible, the Company is unable to quantify certain amounts that would be required to be included in the most directly comparable GAAP financial measures without unreasonable effort. Consequently, no disclosure of estimated comparable GAAP measures is included and no reconciliation of the forward-looking non-GAAP financial measures is included.
Adjusted EBITDA
Adjusted EBITDA is a financial measure not presented in accordance with GAAP but is intended to provide useful and supplemental information to investors and analysts as they evaluate our performance. EBITDA is defined as earnings before interest and other financing expenses, taxes, depreciation and amortization. Adjusted EBITDA is defined as EBITDA adjusted to exclude, or otherwise reflect, interest expense, interest income, income tax expense, depreciation and amortization, credit agreement amendment fees, goodwill impairment, long-lived asset impairment, net (gain) loss on sale and disposition of property and equipment, loss on debt extinguishment, acquisition and integration costs, system deployment costs, strategic initiative costs, indemnification asset adjustments, Tax Receivable Agreement liability remeasurements and stock-based compensation expense. Adjusted EBITDA should not be considered an alternative to net loss that is derived in accordance with GAAP. Management believes that the exclusion of the above-described items from net loss in the presentation of the non-GAAP measure identified above enables us and our investors to more effectively evaluate our operations period over period and to identify operating trends that might not be apparent due to, among other reasons, the variable nature of these items, both in value and frequency, period over period. In addition, management believes this measure may be useful for investors in comparing our operating results with those of other companies.
The following table provides a reconciliation of our net loss, the most directly comparable financial measure presented in accordance with GAAP, to Adjusted EBITDA for the periods presented herein (in thousands):
Three Months Ended
December 31, Year Ended December 31,
-------------------------- --------------------------
2025 2024 2025 2024
------- -------
Net loss $(54,674) $(18,200) $(77,303) $(27,643)
Interest expense 13,550 26,217 101,778 91,609
Interest income (1,900) (1,108) (4,488) (5,464)
Income tax expense 8,499 (4,979) 22,161 4,521
Depreciation and
amortization 28,677 29,862 114,288 110,849
Credit agreement
amendment
fees(1) 3,312 3,682 6,302 7,801
Goodwill
impairment(2) 24,966 17,804 24,966 17,804
Long-lived asset
impairment(3) 2,415 -- 2,415 --
Net (gain) loss on
sale and
disposition of
property and
equipment (127) 29 (326) (270)
Loss on debt
extinguishment 966 -- 6,651 --
Acquisition and
integration
costs(4) 5,501 2,112 8,436 9,181
System deployment
costs(5) -- 1,139 2,140 5,048
Strategic
initiative
costs(6) 2,964 3,545 17,092 10,778
Indemnification
asset
adjustments(7) 3,796 -- 3,796 --
Tax Receivable
Agreement
liability
remeasurements(8) 2,914 -- 2,914 --
Stock-based
compensation
expense 46,122 (3,315) 68,003 5,411
------- ------- ------- -------
Adjusted EBITDA $ 86,981 $ 56,788 $298,825 $229,625
Net loss margin (7.4)% (3.3)% (3.0)% (1.3)%
Adjusted EBITDA margin 11.8% 10.4% 11.7% 10.9%
(1) Represents costs incurred in connection with our debt refinancings in each of the periods presented.
(2) Refer to "Note 5--Goodwill and Intangible Assets" in the Notes to Consolidated Financial Statements to be included in the Annual Report for details on the nature of the impairment.
(3) Refer to "Note 2--Summary of Significant Accounting Policies, Long-Lived Assets Impairment" in the Notes to Consolidated Financial Statements to be included in the Annual Report for details on the nature of the impairment.
(4) For the years ended December 31, 2025 and 2024, the figures include $5.7 million and $5.6 million, respectively, of acquisition costs recorded in Acquisition-related costs, and $2.7 million and $3.6 million, respectively, of acquisition integration costs recorded in Selling, general and administrative on the Consolidated Statements of Operations.
(5) Represents consulting and initial upfront costs associated with implementing and optimizing certain enterprise resource planning systems, including IFS, Onestream and Ceridian Dayforce.
(6) Represents (i) consulting costs associated with rebranding efforts in connection with our name change to Legence that we do not expect to recur in the future, (ii) upfront consulting and out-of-pocket costs related to developing and launching the cross-selling framework amongst our brands, many of which were more recently acquired and integrated into the Legence brand, (iii) consulting and legal fees associated with education and marketing efforts for our clients with respect to utilizing certain government incentive programs, (iv) consulting, legal, accounting, and other expenses in connection with non-recurring extraordinary company transactions, including fees related to our IPO that did not meet the requirements to be deferred issuance costs, and (v) consulting, legal, accounting, and other expenses in connection with a secondary offering conducted on behalf of our selling shareholders.
(7) Represents adjustments to an indemnification asset related to unrecognized tax benefits acquired in a prior acquisition recorded in Other expense (income), net on the Consolidated Statements of Operations and is fully offset as an income tax benefit netted in Income tax expense on the Consolidated Statements of Operations.
(8) Tax Receivable Agreement liability remeasurements are recorded in Other expense (income), net on the Consolidated Statements of Operations.
Adjusted Gross Profit and Adjusted Gross Margin
Adjusted Gross Profit is a financial measure not presented in accordance with GAAP but is intended to provide useful and supplemental information to investors and analysts as they evaluate our performance. Gross profit is defined as revenue less cost of revenue services. Adjusted Gross Profit is defined as gross profit adjusted to exclude stock-based compensation expense related to legacy profit interest units, where the payment of this expense is borne by entities outside of Legence Corp. Adjusted Gross Profit should not be considered an alternative to gross profit that is derived in accordance with GAAP. Adjusted Gross Margin is defined as Adjusted Gross Profit divided by revenue. Management believes that the exclusion of the above-described items from gross profit in the presentation of the non-GAAP measure identified above enables us and our investors to supplement the evaluation of our operations period over period and to identify operating trends that might not otherwise be apparent due to, among other reasons, the variable nature of these items, both in value and frequency, period over period. In addition, management believes this measure may be useful for investors in comparing our operating results with those of other companies.
The following table provides a reconciliation of our gross profit, the most directly comparable financial measure presented in accordance with GAAP, to Adjusted Gross Profit for the periods presented herein (in thousands) and our Adjusted Gross Margin for the same periods:
Three Months Ended Twelve Months Ended
December 31, December 31,
--------------------------
2025 2024 2025 2024
------- ------- -------
Gross Profit
Engineering &
Consulting
Segment $ 47,779 $ 51,518 $238,869 $205,085
Installation &
Maintenance
Segment 99,709 61,423 297,056 225,682
------- ------- ------- -------
Consolidated $147,488 $112,941 $535,925 $430,767
Non-GAAP
Adjustment:
Stock-based
compensation
expense (benefit)
from legacy profit
interest units(1)
Engineering &
Consulting
Segment $ 5,626 $ (333) $ 8,413 $ 837
Installation &
Maintenance
Segment 3,446 (293) 5,327 479
------- ------- ------- -------
Consolidated $ 9,072 $ (626) $ 13,740 $ 1,316
Non-GAAP Adjusted
Gross Profit:
Engineering &
Consulting
Segment $ 53,405 $ 51,185 $247,282 $205,922
Installation &
Maintenance
Segment 103,155 61,130 302,383 226,161
------- ------- ------- -------
Consolidated $156,560 $112,315 $549,665 $432,083
Non-GAAP Adjusted
Gross Margin:
Engineering &
Consulting
Segment 30.9% 32.6% 34.0% 34.2%
Installation &
Maintenance
Segment 18.3% 15.6% 16.6% 15.1%
------- ------- ------- -------
Consolidated 21.2% 20.5% 21.6% 20.6%
(1) Represents the portion of stock-based compensation expense related to legacy profit interest units paid for by entities outside of Legence Corp. and recorded in cost of revenue in the Consolidated Condensed Statement of Operations. Figures exclude the portion of stock-based compensation expense related to restricted stock units and other equity awards issued by Legence Corp.
Net Leverage
Net leverage is defined as net debt divided by Adjusted EBITDA. The Company believes this non-GAAP measure is useful to investors as it provides alternative information that management believes to be useful in assessing our ability to meet our payment obligations in addition to considering the absolute amount of our debt. Net debt is a financial measure not presented in accordance with GAAP but is intended to provide useful and supplemental information to investors and analysts as they evaluate our performance. Net debt includes total balance sheet debt, excluding finance lease liabilities, less cash and cash equivalents.
Backlog and Awarded Contracts and Book-to-Bill Ratio
We believe that backlog and awarded contracts and book-to-bill ratio enable us to more effectively forecast our future results and working capital needs, as well as better identify future operating trends that may not otherwise be apparent. Backlog represents, as of any date of determination, the expected revenue values of the remaining performance obligations under our contracted fixed-price projects. Awarded contracts represents, as of any date of determination, the expected revenue values of projects awarded to us following a request for proposals but for which a formal contract has not yet been signed. We calculate our book-to-bill ratio by taking our additions to backlog and awarded contracts, excluding additions that were attained through acquisition, for the period, and dividing it by revenue from fixed-price contracts for the same period. Given that backlog and awarded contracts and book-to-bill ratio are operational measures and that our methodology for calculating each such measure does not meet the definition of a non-GAAP financial measure, as that term is defined by the SEC, a quantitative reconciliation for each is not required nor provided.
(1) Adjusted EBITDA is a non-GAAP financial measure. Definitions of non-GAAP financial measures and reconciliations of each non-GAAP financial measure to the most directly comparable GAAP financial measure are included in the section titled "Non-GAAP Financial Measures."
(2) Total debt defined as Term Loan balance of $797.8 million and Notes Payable balance of $27.3 million.
(END) Dow Jones Newswires
March 27, 2026 07:00 ET (11:00 GMT)
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