MasTec’s latest quarter saw robust year-on-year revenue growth, but the market reacted negatively, reflecting concerns about execution and margin sustainability. Management attributed the quarter’s performance to organic expansion across Communications, Clean Energy, and Power Delivery segments. CEO Jose Mas emphasized that backlog reached a record level, supported by broad-based demand and investments in new geographies and services. However, operational investments and project mix—particularly in Power Delivery—tempered margin expansion, as highlighted by continued cost pressures and permitting delays in major projects.
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MasTec (MTZ) Q3 CY2025 Highlights:
- Revenue: $3.97 billion vs analyst estimates of $3.91 billion (22% year-on-year growth, 1.6% beat)
- Adjusted EPS: $2.48 vs analyst estimates of $2.30 (7.7% beat)
- Adjusted EBITDA: $373.4 million vs analyst estimates of $369.4 million (9.4% margin, 1.1% beat)
- The company slightly lifted its revenue guidance for the full year to $14.08 billion at the midpoint from $13.95 billion
- Management raised its full-year Adjusted EPS guidance to $6.40 at the midpoint, a 1% increase
- EBITDA guidance for the full year is $1.14 billion at the midpoint, below analyst estimates of $1.14 billion
- Operating Margin: 6.4%, in line with the same quarter last year
- Backlog: $16.78 billion at quarter end, up 21.1% year on year
- Market Capitalization: $15.46 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From MasTec’s Q3 Earnings Call
- Ati Modak (Goldman Sachs) asked about the visibility for Pipeline backlog and future revenue, to which CEO Jose Mas replied that structural changes in project awards provide more confidence in double-digit growth for 2026 and substantial growth beyond.
- Jamie Cook (Truist Securities) inquired about permitting issues on the Greenlink project and overall large project capacity. Mas explained that most of the guidance revision stemmed from Greenlink delays, but highlighted that the core Power Delivery business remains largely maintenance-driven and predictable.
- Steven Fisher (UBS) probed the Communications segment’s margin trajectory and investment cycle. Mas stated that margins are improving as earlier investments mature, and government broadband programs like BEADs could further support growth in 2026.
- Philip Shen (ROTH Capital Partners) questioned the sustainability of margin expansion and the impact of operational expenditures. Mas acknowledged that growth investments have pressured margins but expects improvement as new operations scale.
- Marc Bianchi (TD Cowen) sought clarification on backlog conversion rates and the outlook for Communications segment growth in 2026. Mas confirmed confidence in achieving double-digit top-line growth for Communications next year.
Catalysts in Upcoming Quarters
In the coming quarters, StockStory analysts will be monitoring (1) progress resolving permitting and execution challenges in large Power Delivery and Pipeline projects, (2) the pace at which new geographies and customer segments in Communications and Clean Energy transition from investment phase to profitability, and (3) evidence of sustained backlog growth translating into higher-margin revenue. Expansion into data center infrastructure and the impact of government broadband programs will also be key signposts.
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