Dycom Eyes 10%-12% Growth as Data Center, Fiber Demand Accelerates

Dycom Industries NYSE: DY is positioning itself as an end-to-end infrastructure services provider for growing data consumption, expanding from its traditional telecommunications work into data-center electrical and structured-cabling services, Chief Executive Officer Dan Peyovich said at D.A. Davidson’s 25th Annual Diversified Industrials & Services Conference.

Peyovich said Dycom historically built fiber and hybrid fiber-coaxial infrastructure connecting homes and businesses, and has increasingly moved closer to data centers. The company now provides work spanning fiber transmission to data centers, electrical systems within facilities and structured cabling.

Dycom expects 10% to 12% organic growth in fiscal 2027, with that growth coming through its telecommunications business, Peyovich said. He characterized the company’s communications operations as roughly split between recurring service and maintenance work and program work tied to major infrastructure deployments. Service and maintenance accounts for about half of Dycom’s revenue and has a recurring profile tied to the size of the infrastructure footprint, according to Peyovich. The remaining program work includes fiber-to-the-home, long-haul and middle-mile fiber deployments, and work associated with the Broadband Equity, Access, and Deployment, or BEAD, program.

Fiber-to-the-home revenue grew 60% year over year in the first half, Peyovich said, while cautioning investors not to expect that rate in every period. He said the company still sees several years of significant fiber-to-the-home growth before activity eventually tapers. Long-haul and middle-mile fiber work is also beginning to build. Dycom has installed about $100 million of such work over the past several years and has more than $1 billion of pure backlog for fiber connecting data centers nationwide, Peyovich said. He said the company had previously identified a $20 billion addressable market over five years for this category and expects the opportunity to extend over a long period. BEAD-related activity is beginning to show “green shoots” as projects move through funding and permitting, he added.

Dycom expects multiple demand drivers to be active by calendar 2028, including fiber-to-the-home, long-haul and middle-mile work, and BEAD-related deployments.

Peyovich said Dycom is investing ahead of anticipated demand to ensure its workforce does not constrain customer projects. The company has approximately 21,000 employees nationwide and is holding customer discussions that extend three to five years into the future, he said. He said permitting, rather than labor, is currently the principal constraint in Dycom’s communications business. However, he expects industrywide ...