Highlights

  • Second quarter revenue rose 46% to $2.01 billion, including $397.5 million from acquired businesses and 16.7% Communications growth.
  • Net income rose to $115.6 million, though Communications pre-tax income slipped 2% and net interest expense more than doubled.
  • Backlog reached $12.242 billion on August 1, up from $9.542 billion at January 31, with 52.9% due within twelve months.
  • Dycom bought National Technology Integrators in July for $275 million and authorized a new $150 million buyback on August 26.

Dycom Industries (NYSE:DY) shares were trading near their 52-week low at USD 238.97 on October 21, 2026, down 5.17%. The specialty contractor filed its report for the second quarter of fiscal 2027 on August 27, after buying National Technology Integrators and announcing a new share repurchase authorization.

Based in West Palm Beach, Florida, Dycom is a Florida corporation that describes itself as a leading provider of specialty contracting services for the digital infrastructure, telecommunications and utilities industries across the United States. It plans, builds and maintains fiber, wireless and electrical networks and, since acquiring Power Solutions, installs electrical and security systems in data centers. It reports two segments, Communications and Building Systems. Its fiscal year ends on the last Saturday in January, and fiscal 2027 has 52 weeks.

Acquisitions Lift Revenue, Margins Mixed

Contract revenues for the quarter ended August 1, 2026 were $2.006 billion against $1.378 billion a year earlier. Acquired businesses contributed $397.5 million, and the remaining $230.5 million increase came mainly from fiber-to-the-home deployments, including rural fiber programs. Communications revenue rose 16.7% to $1.608 billion, and the new Building Systems segment, built around Power Solutions, added $397.5 million.

Profit grew more slowly than sales. Costs of earned revenues rose to 78.0% of revenue from 77.7%, and depreciation and amortization nearly doubled to $115.6 million, with amortization of acquired intangibles at $60.5 million versus $11.9 million. Net interest expense climbed to $38.0 million from $15.6 million on higher borrowings. Pre-tax income increased 17.5% to $154.0 million, and net income rose to $115.6 million from $97.5 million, or $3.81 per diluted share compared with $3.33.

Segment detail is more mixed. Communications income before income taxes fell 2.0% to $143.8 million, while Building Systems earned $48.2 million. Adjusted EBITDA, a non-GAAP measure, rose 53.5% to $315.5 million, or 15.7% of revenue. In Communications, it was $218.3 million, a margin of 13.6% against 14.9%, and Building Systems contributed $97.2 million at 24.5%. For six months, revenue was $3.971 billion, net income was $206.9 million, and adjusted EBITDA was $578.0 million.

Customer concentration is high but shifting. AT&T accounted for 20.1% of quarterly revenue, down from 27.1%, Verizon for 10.4% against 14.2%, and Lumen for 5.3% against 11.3%.

Cash Flow, Debt and Capital Allocation

Cash and equivalents were $340.1 million on August 1, 2026, compared with $709.2 million at January 31. Operating activities provided $79.1 million in the first six months, up from $3.5 million, even as working capital used $428.1 million, mainly from a $520.8 million rise in receivables tied to growth and acquired balances. Days sales outstanding improved to 101 from 108.

Long-term debt stood at $2.79 billion. The credit agreement includes an $800.0 million revolver with $746.4 million of availability and no borrowings, term loans and $500.0 million of 4.50% senior notes due 2029. The company said it was in compliance with its covenants, including a maximum net leverage ratio of 4.50 to 1.00.

National Technology Integrators, a Maryland low-voltage engineering and construction firm, joined Building Systems on July 2 at a purchase price of $275.0 million, paid through $226.4 million in cash, 95,550 shares valued at $45.0 million and $12.3 million of assumed debt. In the six months, Dycom repurchased 100,000 shares for $36.0 million. On August 26 the board authorized a new program of up to $150.0 million through February 2028, replacing $83.9 million left on the prior one. The company does not expect to pay cash dividends in the foreseeable future.

Backlog and Outlook

Backlog was $12.242 billion, including $10.983 billion in Communications and $1.259 billion in Building Systems, and the company expects to complete 52.9% of it within twelve months. It cautions that customers are generally not committed to specific volumes and that many contracts can be canceled. The quarterly report gives no numerical guidance. Management says its strategy centers on core maintenance and operations services, multi-year fiber-to-the-home builds, data center fiber and electrical infrastructure, government broadband funding and wireless modernization.