Shimmick Q2 Earnings Call Highlights

Shimmick’s Q2 revenue fell to $107 million from $128 million as legacy and non-core projects wound down, but gross margin improved to 12% from 6% and net loss narrowed to $5 million. New awards totaled $138 million during the quarter, lifting backlog to a two-year high of $991 million; pending awards pushed combined backlog and awards above $1.2 billion. The company lowered 2026 revenue guidance to $525 million–$575 million while reaffirming adjusted EBITDA guidance of $15 million–$30 million, citing expected growth as newer, higher-margin projects ramp up. Shimmick NASDAQ: SHIM reported second-quarter 2026 revenue of $107 million and adjusted EBITDA of $4 million as the infrastructure contractor continued to wind down non-core work, improve project controls and build its backlog of higher-margin projects. The company said consolidated gross margin rose to 12% from 6% in the prior-year period, while net loss narrowed to $5 million from $9 million. Management said the quarter reflected progress on its strategy to exit lower-margin projects and position newly awarded work for future revenue and margin growth. Second-quarter revenue declined from $128 million in the second quarter of 2025. Shimmick project revenue fell to $96 million from $113 million, primarily because projects reached or neared completion during 2025 and continued winding down in 2026, CFO Todd Yoder said. Non-core project revenue declined to $11 million from $16 million a year earlier. Yoder attributed the decrease to the termination of the Chickamauga Lock replacement project during the first quarter and continued progress toward completing the company’s remaining non-core projects. Despite lower revenue, total gross margin increased to $12 million from $8 million. Shimmick project gross margin declined by $4 million to $11 million as maturing projects contributed less margin, though newer projects partially offset that decline as they ramped up. Non-core gross margin improved to $2 million from a loss of $7 million a year earlier, when the company recorded cost overruns on non-core loss projects. SG&A expense increased to $16 million from $15 million, reflecting higher one-time legal costs and expenses related to an equity issuance, according to Yoder. CEO Ural Yal said Shimmick booked $138 million of new work during the quarter, producing a book-to-burn ratio of 1.4 and marking the company’s fourth consecutive quarter with a positive ratio. Total backlog reached $991 million, its highest level in two years. The company also cited additional awards after the quarter ended. Yoder said Shimmick had $221 million of awards pending fully executed contracts, bringing combined backlog and pending awards above $1.2 billion. Separately, Yal said the company had announced more than $265 million of new awards across its water, industrial and energy, and infrastructure operations. Management said less than 10% of the backlog booked during the past 12 months had been converted into revenue so far, leaving substantial work in pre-construction or early project phases. Yal said some projects have taken six or seven months to begin after selection, compared with the company’s typical three- to four-month startup period, due in part to customer permitting and other factors outside Shimmick’s control. “As these projects ramp and begin burning work at the pace we expect, we anticipate improved absorption of overhead and greater contribution from high-quality work entering the portfolio,” Yal said.