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    FLR
    Earnings call· Jun 2026(Q2 FY26)

    FLUOR Q2 FY26 earnings call FLR

    Aug 7, 2026 Source

    Executive summary

    Fluor Q2 FY26 — Strong New Awards Drive Backlog Growth and Positive Outlook

    Fluor delivered strong Q2 FY26 results, marked by significant new awards and backlog growth, driven by accelerated client decisions across diverse end markets. The company is strategically simplifying its portfolio by completing legacy projects and divesting its Mexican JV, while focusing on high-growth areas like nuclear and power generation for data centers. Management anticipates continued margin expansion in new awards and robust capital returns.

    Highlights

    5

    • New awards for the quarter were strong at over $6 billion, driving backlog to almost $27 billion.

    • Book-to-bill ratio is expected to be well above 1 for the full year.

    • Adjusted EBITDA increased to $149 million in Q2 FY26, up from $96 million a year ago.

    • Adjusted EPS was $0.91 in Q2 FY26, compared with $0.43 last year.

    • Completed 2 legacy infrastructure projects, with the remaining 2 expected to complete by year-end.

    Concerns

    4

    • The Gordie Howe project incurred $44 million in additional losses in Q2 due to foreign currency fluctuation, subcontractor bankruptcy, and client-driven changes.

    • Operating cash flow for the quarter was a negative $317 million, including a $357 million tax payment associated with NuScale shares.

    • An additional $94 million in future funding for legacy projects is expected to be concluded in Q3.

    • Foregone profit of about $23 million in the second half of the year from the former Mexican JV impacts comparable guidance.

    Guidance & targets

    18
    CategoryTargetConfidence
    Adjusted EBITDA
    $500M-$525M
    high materiality
    High
    Adjusted EPS
    $2.70-$2.80
    high materiality
    High
    Adjusted Operating Cash Flow
    $300M-$320M
    high materiality
    High
    New awards book-to-burn ratio
    well above 1
    high materiality
    High
    G&A
    $170M-$180M
    medium materiality
    High
    Assumed tax rate
    28%-30%
    medium materiality
    High
    Revenue split
    Urban 65%, Energy 20%, Mission 15%
    medium materiality
    High
    Urban Solutions segment margin
    2.5%-3%
    medium materiality
    High
    Energy Solutions segment margin
    6%-7%
    medium materiality
    High
    Mission Solutions segment margin
    6%
    medium materiality
    High
    Share repurchases
    $1.4B
    high materiality
    High
    Legacy projects completion
    LAX and I-35 Phase II completed
    high materiality
    High
    Power projects backlog growth
    Meaningful growth in backlog
    high materiality
    Medium
    Mining and Metals potential awards pipeline
    $30B
    high materiality
    Medium
    Savannah River rebid decision
    Decision expected
    medium materiality
    Medium
    Savannah River current work extension
    6-month extension
    medium materiality
    High
    LNG Canada Phase 2 Final Investment Decision
    Expected
    high materiality
    Medium
    Refinery EPC work
    Could translate into EPC work
    medium materiality
    Low

    Segment performance

    3
    SegmentRevenueYoYQoQMargin
    Urban Solutions
    Q2 segment profit included $44 million in additional losses on the Gordie Howe project. Expected to drive further growth over the next several quarters and contribute more meaningfully to EBITDA in H2 FY26. Full year segment margin expectation is 2.5% to 3%.
    Q2 Segment Profit: $38MQ2 Segment Profit YoY: vs $29MNew Awards: $3.2B
    		Majority of total revenue——$38M
    Energy Solutions
    Profit largely arose from higher contributions on projects nearing completion, evidencing high quality of closeout efforts. Expected to be a lesser contributor to EBITDA in H2 FY26 as the business reloads. Full year segment margin expectation is 6% to 7%.
    Q2 Segment Profit: $88MQ2 Segment Profit YoY: vs $15M
    		———$88M
    Mission Solutions
    Driven primarily by improved fee performance across the DOE portfolio. Expected to have a similar contribution to EBITDA in H2 FY26. Full year segment margin expectation is 6%.
    Q2 Segment Profit: $44MQ2 Segment Profit YoY: vs $35M
    		———$44M

    Operational metrics

    12
    Adjusted EBITDA
    $149Mup from $96M YoY
    Q2 FY26

    Reported adjusted EBITDA for the second quarter.

    Adjusted EPS
    $0.91vs $0.43 last year
    Q2 FY26

    Reported adjusted EPS for the second quarter.

    Cash and cash equivalents
    $3Bvs $3.2B at March 31
    End Q2 FY26

    Cash balance at the end of the second quarter.

    Cash and cash equivalents
    $3.2Bslight increase from Q2 end
    July 31, 2026

    Cash balance as of July 31, 2026.

    Share repurchases
    $300M
    Q2 FY26

    Amount and volume of shares repurchased in the second quarter.

    Legacy project funding
    $96M
    Q2 FY26

    Funding provided for loss projects in Q2, with a portion reflected in operating cash flow.

    Legacy project remaining funding
    $94M
    Future

    Remaining funding required for legacy projects, expected to be concluded in the third quarter.

    Mexican JV sale price
    $175M
    July 2026

    Sale price for the equity in the Mexican joint venture.

    Mexican JV pretax book gain
    $90M
    Q3 FY26

    Pretax book gain recognized from the sale of the Mexican joint venture, excluded from adjusted EBITDA guidance.

    Mexican JV sale tax payment
    $33M
    Q3 FY26

    Tax payment funded in Q3 related to the sale of the Mexican joint venture.

    Foregone profit from Mexican JV
    $23M
    H2 FY26

    Profit that would have been generated by the former Mexican JV in the second half of the year, impacting comparable guidance.

    Revenue growth
    9%YoY
    Q2 FY26

    Company-wide revenue growth for the quarter.

    Industry KPIs

    4
    MetricValueDetails
    Total backlog$26.9BUSD
    Book to bill ratiowell above 1ratio
    End market pipeline$30BUSD
    Same store organic revenue growth9%%

    Orderbook & backlog

    5
    New awardsover $6BQ2 FY26
    Total backlog$26.9BEnd Q2 FY26

    grew to almost $27B

    Mexican JV backlog removedjust over $650MQ2 FY26

    Removed preemptively even though sale closed in Q3.

    Legacy project remaining backlog$120MEnd Q2 FY26

    decreased

    Will continue to wane across the back half of '26.

    Urban Solutions new awards$3.2BQ2 FY26

    Deals & partnerships

    4
    Mexican Joint Venture partnerSale of Fluor's equity in the Mexican joint venture.$175M

    Concluded the joint venture after 30+ years due to diminishing backlog and limited prospects in Mexico, allowing former partner more autonomy and sharpening Fluor's focus on targeted growth areas.

    AramcoLong-term agreement to support a broad portfolio of capital projects.

    Extends decades-long relationship with Aramco, positioning Fluor to support global capital projects.

    LNG CanadaLimited notice to proceed for Phase 2 of the LNG Canada project.

    Enables early planning and advance key activities in support of the client's proposed final investment decision expected later this year.

    CentrusAward for the Centrus Fuel Enrichment project.

    Continues to build Fluor's presence in the nuclear value chain, supporting uranium enrichment capability in the U.S.

    Capital programs

    1
    ERP and other technology enhancementsunderway
    Period spend: up to $15M

    Excluding up to $15 million across the full year for a potential replacement of our ERP and for other technology enhancements from G&A guidance.

    Risks & headwinds

    5
    Gordie Howe project additional lossesQ2 FY26

    $44M

    Mitigation: Working collaboratively with client, partners, and subcontractors to resolve remaining commercial matters.

    Middle East hostilitiesOngoing

    No direct impact to guidance

    Mitigation: Monitoring evolving situation, prioritizing employee well-being, executing work in backlog without significant disruption, engaged with clients for future opportunities once situation stabilizes.

    Legacy project funding requirementsQ3 FY26

    $94M remaining

    Mitigation: Liquidity available to make payments, awaiting partner funding; focus on completing LAX and I-35 Phase II by year-end.

    Foregone profit from Mexican JV saleH2 FY26

    $23M

    Mitigation: Strategic decision to divest for sharpened focus and bolstered liquidity; incorporated into revised guidance.

    Mining project additional scope impactNext couple of months for resolution

    Likely impact on timing and schedule

    Mitigation: Ongoing conversations with the client to resolve additional scope items.

    What to watch in Q3 FY26

    5

    Remaining legacy project completion

    End of FY26
    Current$120M backlog, 2 projects (LAX, I-35 Phase II)
    TargetCompletion of LAX and I-35 Phase II

    Why it matters

    Final resolution of long-standing loss-making projects will remove a significant drag on financial performance and management focus.

    The good news is that with the Gordie and LBJ projects now complete, we can focus our remaining efforts on completing LAX and I-35 Phase II by the end of this year.

    Q&A highlights

    6

    The analyst asked about the normalized profitability of Energy Solutions, excluding favorable closeouts, and if the acceleration of new awards impacts 2026 guidance or indicates a broader trend.

    Management explained that closeout efforts represent profits that could have been recognized earlier. Energy Solutions' segment profit percentage will diminish in H2 as they reload, with Urban Solutions contributing more. For new awards, strong Q2 performance and good Q3/Q4 prospects support a book-to-bill 'well above 1' for FY26, but no broad acceleration trend was noted.

    “So what you'll see in the back half of the year is a shift in the portfolio, whereby Urban Solutions is more meaningfully contributing to the absolute quantum of EBITDA as opposed to Energy Solutions.”

    asked by Jamie Cook · answered by John Regan

    2 min read6 chapters

    Detailed Narrative

    01

    Strong New Awards and Backlog Growth

    Fluor secured over $6 billion in new awards in Q2 FY26, pushing its backlog to nearly $27 billion. This performance supports a full-year book-to-bill ratio well above 1, with client decisions accelerating across nuclear fuels, fertilizers, copper, and midstream. The company is actively replenishing its front-end pipeline with new opportunities in target markets like fertilizers, data centers, copper, domestic refining, nuclear power, chemicals, and LNG.

    02

    Strategic Portfolio Simplification and Legacy Project Resolution

    The company completed two legacy infrastructure projects (LBJ, Oakhill Parkway, Red Purple Line, Gordie Howe Bridge) in Q2, with two more (LAX, I-35 Phase II) expected to conclude by year-end, reducing the remaining legacy backlog to $120 million. Additionally, Fluor divested its Mexican joint venture for $175 million in July, resulting in a $90 million pretax book gain. This move sharpens the company's focus on targeted growth areas and bolsters liquidity.

    03

    Expanding Presence in the Nuclear Value Chain

    Fluor is actively building its presence across the full nuclear life cycle, from commercial power generation and SMR technology (including NuScale and ex Energy) to nuclear fuels, national security, and environmental cleanup. The recent Centrus Fuel Enrichment project award highlights this expansion. Management believes this capability positions Fluor for attractive opportunities as global investment in nuclear infrastructure accelerates.

    04

    Focus on Power Generation within Data Center Ecosystem

    Fluor views power generation as its primary strategic play within the broader data center ecosystem. The company is making significant progress on front-end work for domestic gas fuel power projects, including combined cycle and single cycle plants. These efforts are expected to lead to meaningful backlog growth in the first half of 2027, while the company remains selective in pursuing data center construction opportunities.

    05

    Robust Mining & Metals Pipeline

    Fluor's in-house Mining and Metals pipeline includes nearly $30 billion in potential awards over the next 18 months, primarily in copper, fertilizers, steel, and aluminum. The company is collaborating closely with clients to ensure capital efficiency and mitigate risks from escalation and supply chain disruption🌐s. The majority of this work is expected to be reimbursable, attracting historic margins for the business.

    06

    Capital Allocation and Liquidity Management

    Fluor ended Q2 with $3 billion in cash and cash equivalents, which increased to $3.2 billion by July 31. The company repurchased 6 million shares for $300 million in Q2 and plans $1.4 billion in repurchases for the full fiscal year 2026. Management also continues to evaluate disciplined inorganic opportunities in selected growth markets aligned with its strategic objectives.

    AI-generated summary of the company’s earnings call. Not investment advice.