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SOLV ENERGY INC earnings calls

MWH · every analyst question and management's answer

Aug 13, 2026 earnings call — Record execution and backlog growth

Backlog grew to approximately $8.9 billion, a 44% year-over-year increase.

Revenue $1.0B (est $0.7B) · EPS $0.30 (est $0.24) · Next-quarter revenue outlook $3.9B–$4.0B

Key quotes

"Backlog at the end of the second quarter grew to approximately $8.9 billion, representing 44% growth over the last 12 months."

— Chad Plotkin (CFO) · Backlog and pipeline

"We now expect full year revenue of $3.87 billion to $3.97 billion, adjusted gross profit of $620 million to $660 million and an adjusted EBITDA of $485 million to $505 million."

— Chad Plotkin (CFO) · Financial results and guidance

"We also continued executing on our M&A strategy with the closing of the Roberson Waite Electric acquisition on July 1."

— George Hershman (CEO) · M&A and platform expansion

Analyst Q&A 8

Why backlog increased

Q (Julien Dumoulin-Smith · Jefferies): He asked what drove the backlog increase — LNTP conversions, new awards, scope changes, or faster customer decisions — and asked for more detail on the base backlog. He also asked for early views on Section 232 and any notes on the Big Rooter project.

A: Management said the backlog is growing because many projects in their large project funnel are moving into LNTP and getting executed on plan. They said energy storage — mostly solar plus storage and some stand-alone — is driving the backlog increase. On Section 232 they see not much near-term impact and said Big Rooter has been in backlog while moving through LNTP into final notice to proceed.

"As we have spoken about before, we have a large funnel above the backlog that we report." — George Hershman (CEO)

2027/2028 visibility and O&M trend

Q (Michael Fairbanks · JPMorgan): He asked how much visibility the backlog gives into 2027 and 2028 and what portion of 2027 is already booked. He also asked how O&M attach rates should trend and whether they will pick up as projects finish.

A: They said their backlog gives a roughly 24 to 30-month view, which provides good visibility into 2027 and 2028, and that a large portion of 2027 looks strong based on signed awards. They noted they have 23 gigs under contract and that O&M revenue lags until projects are in operation. Attachment rates oscillate by customer, but they are seeing incremental growth and the O&M business creates optionality for nonrecurring work with attractive economics.

"So our backlog traditionally is about a 24 to 30-month look." — George Hershman (CEO)

Section 232 risk; guidance and margins

Q (Philip Shen · ROTH Capital Partners): He asked how much of awarded backlog is at risk from poly Section 232 because some projects may need PPA renegotiation. He also asked why the revenue raise was small relative to backlog and whether EBITDA margins can improve with crew visibility and less lag.

A: They said they are working closely with customers and so far see no real near-term impact from Section 232, noting module procurement is handled by customers and they are not seeing schedules slip. On revenue timing, they said many backlog additions start with LNTP so revenue often lags until notice to proceed and the backlog sets them up beyond 2026 into 2027 and 2028. On margins, they emphasized disciplined execution, that early project stages start at budgeted margins and can outperform over time, and that larger average project sizes (450 megawatts) give operating leverage.

"So what we're seeing that there's no real impact into near term." — George Hershman (CEO)

TRA cash payments

Q (Jonathan Windham · UBS): He asked whether there were any cash disbursements related to the tax receivable agreement (TRA) in the second quarter. He noted many moving parts after the IPO.

A: They said the TRA revaluation was driven by the secondary transaction but there were no disbursements under the TRA in the quarter. They explained actual TRA payments likely won't manifest until 2028 because payments wait until after the first period corporate tax return and related timing through late 2027 and later LLC provisions.

"As far as disbursements under the TRA, the answer is no." — Chad Plotkin (CFO)

RWE impact and M&A targets

Q (Dylan Nassano · Wolfe): He asked how much of the backlog and guidance increase came from the RWE closing and then asked what other areas are missing from their M&A Venn diagram — what they want to bolster by acquisition.

A: They said they did not disclose the specific contribution from RWE and that its impact is embedded in the numbers, with EBITDA contribution at the margin. On M&A targets, they said they are looking to add expertise such as electrical direct labor in certain regions and to expand O&M and direct services, and they prefer acquisitions that sit in the center of their ecosystem to optimize across sectors.

"So I don't think there's anything outside of that diagram that we're looking for specifically." — George Hershman (CEO)

O&M opportunity and quarter split

Q (Nicholas Amicucci · Evercore): He asked about opportunities on the services/O&M side if the EPC market slowed, and how to think about the revenue split and ramp between the third and fourth quarters of the year.

A: They said their combined EPC and O&M model lets them shift into O&M if needed, and they are not seeing any near-term EPC slowdown; they can flex into large equipment repair and other service work. For quarter phasing, they said fourth quarter typically has lower revenue because of fewer workdays and holidays, so the third quarter is usually the bigger lift and some lumpiness is normal.

"We absolutely have the ability to flex more into O&M services." — George Hershman (CEO)

Acquisition performance and demand outlook

Q (Mark Jarvi · CIBC): He asked how past completed acquisitions performed versus plan and what drove any under- or outperformance. He also asked if future tuck-ins will show the same benefits and how customers view demand into the 2030s.

A: They said past acquisitions have generally performed very well relative to their underwrite and have added value by enabling self-performance and scaling into larger projects. They expect similar synergies from future deals and will keep targeting companies that add complementary expertise. They also said customer conversations are very positive on long-term demand, projects tend to execute within 24 to 30 months, and the project funnel continues to expand.

"I think what we'd say is they've performed very well relative to our underwrite." — Chad Plotkin (CFO)

Bookings near-term and M&A strategy

Q (Ben Kallo · Baird): He asked whether bookings might pause near term around Section 232 while customers reassess procurement, and whether M&A will expand scope into other generation types and how they view valuations.

A: They said they do not expect a general pause in bookings because there is evidence of modules already in the country, domestic supply, and developers are advancing projects to secure capacity, so the LNTP phase will continue to advance even if originations are lumpy. On M&A, they are building an operating model and discipline to pursue larger and strategic deals, and they view prior smaller acquisitions as strategically important for expertise and derisking; they are also discussing hybrid generation needs with customers.

"So as we think about moving forward and getting into the LNTP phase, that part of the phase will continue to advance overall." — Chad Plotkin (CFO)

AI-generated notes on the earnings call transcript. Quotes are taken from the transcript. This is not a FolioObs investment view.

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