Legence (LGN) Q3 2025 Financial Results Summary
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Legence Corp. (LGN) Q3 2025 Financial Results Summary
Release Date: November 14, 2025
Legence Corp. reported its financial results for the third quarter ending September 30, 2025, showcasing impressive growth across various metrics compared to the same quarter in the previous year.
Key Financial Highlights:
- Revenues:
- Total revenues of $708.0 million, representing a 26.2% increase from $560.8 million in Q3 2024.
-
Breakdown:
- Engineering & Consulting: $212.2 million (up 9.5% from $193.8 million)
- Installation & Maintenance: $495.8 million (up 35.1% from $367.0 million)
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Gross Profit:
- Gross profit of $148.1 million, a 24.9% increase from $118.5 million.
-
Gross margin slightly decreased to 20.9% from 21.1% a year ago.
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Net Loss:
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Net loss attributable to Legence was $(0.6) million, or $(0.02) per diluted share, compared to a net loss of $(1.1) million in Q3 2024.
-
Adjusted EBITDA:
- Non-GAAP Adjusted EBITDA of $88.8 million, up 38.9% from $64.0 million year over year.
Segment Performance:
- Engineering & Consulting:
- Revenues of $212.2 million, up 9.5%.
- Gross profit of $67.3 million, a 5.3% increase.
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Margins slightly declined to 31.7% from 33.0%.
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Installation & Maintenance:
- Revenues surged to $495.8 million, marking a 35.1% growth.
- Gross profit increased to $80.7 million, a 47.9% increase.
- Margins improved to 16.3% from 14.9%.
Backlog and Awards:
- Total Backlog and Awards:
- Reached $3.1 billion, representing a 29.4% increase from $2.4 billion year-over-year.
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Book-to-bill ratio stood at 1.5x, up from 1.3x.
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Segment-specific backlog:
- Engineering & Consulting: $894.7 million (up 1.5% from $881.5 million).
- Installation & Maintenance: $2.2 billion (up 45.9% from $1.5 billion).
Debt and Liquidity:
- Total Debt: Decreased to $836 million.
- Net Debt: Reduced to $650 million following strong cash generation and IPO proceeds.
- Net leverage stood at 2.4 times based on Adjusted EBITDA for the last 12 months.
Guidance:
- For Q4 2025:
- Revenue Guidance: $600 million to $630 million.
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Adjusted EBITDA Guidance: $60 million to $65 million.
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For Full Year 2026:
- Revenue Guidance: $2.65 billion to $2.85 billion.
- Adjusted EBITDA Guidance: $295 million to $315 million.
Acquisitions:
- Legence signed a definitive agreement to acquire Bowers Group, a mechanical contractor based in the Northern Virginia/DC Metro area, for $475 million.
- Completed tuck-in acquisitions of Arizona Pinnacle Engineering and Innovative Mechanical & Design.
Dividends and Share Repurchase:
- No dividend was declared for the quarter.
- No share repurchase activity was mentioned in the report.
Summary:
Legence Corp. demonstrated robust growth in Q3 2025, with significant increases in revenue, Adjusted EBITDA, and backlog compared to the prior year. The company also highlighted a strategic acquisition process and significantly reduced its debt, positioning itself well for future growth.
Condensed Consolidated Statements of Operations
(In thousands, except per share data) (Unaudited)
| 2025 | 2024 | 2025 | 2024 | |
|---|---|---|---|---|
| Revenue | 708,006 | 560,804 | 1,812,849 | 1,550,387 |
| Cost of revenue | 559,947 | 442,258 | 1,424,412 | 1,232,561 |
| Gross profit | 148,059 | 118,546 | 388,437 | 317,826 |
| Selling, general and administrative | 85,887 | 67,199 | 227,814 | 179,848 |
| Depreciation and amortization | 24,183 | 25,475 | 75,619 | 70,738 |
| Acquisition-related costs | 795 | 154 | 971 | 5,593 |
| Loss (gain) on sale of property and equipment | 21 | — | -199 | — |
| Equity in earnings of joint venture | -24 | -1,233 | -848 | -3,131 |
| Income from operations | 37,197 | 26,951 | 85,080 | 64,778 |
| Interest expense | 28,183 | 23,707 | 88,228 | 65,392 |
| Interest income | -1,069 | -523 | -2,588 | -4,356 |
| Loss on debt extinguishment | 5,685 | — | 5,685 | — |
| Credit agreement amendment fees | 64 | — | 2,990 | 4,119 |
| Other income, net | -123 | -121 | -268 | -434 |
| Total other expense, net | 32,740 | 23,063 | 94,047 | 64,721 |
| Income (loss) before income tax | 4,457 | 3,888 | -8,967 | 57 |
| Income tax expense | 4,078 | 4,564 | 13,662 | 9,500 |
| Net income (loss) | 379 | -676 | -22,629 | -9,443 |
| Net income attributable to | 955 | 407 | 4,430 | 407 |
| Net loss attributable to Legence | -576 | -1,083 | -27,059 | -9,850 |
| Net loss per Class A Common Stock—basic and diluted | -0.02 | -0.02 | ||
| Weighted-average Class A Common Stock outstanding—basic and diluted | 58,511 |
Condensed Consolidated Balance Sheets
(In thousands) (Unaudited)
| September 30, 2025 | December 31, 2024 | |
|---|---|---|
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | 176,034 | 81,167 |
| Accounts receivable, net | 588,433 | 448,610 |
| Contract assets, net | 234,302 | 188,132 |
| Prepaid expenses and other current assets | 39,038 | 38,506 |
| Total current assets | 1,037,807 | 756,415 |
| Property and equipment, net | 81,094 | 73,381 |
| Operating lease right-of-use assets, (including amounts from related parties) | 106,469 | 90,922 |
| Goodwill | 782,931 | 781,194 |
| Intangible assets, net | 562,361 | 624,250 |
| Other assets | 29,607 | 26,338 |
| Total assets | 2,600,269 | 2,352,500 |
| Liabilities and Equity | ||
| Current liabilities: | ||
| Accounts payable | 224,256 | 126,502 |
| Accrued compensation and benefits | 89,832 | 54,601 |
| Accrued and other current liabilities | 25,659 | 28,490 |
| Contract liabilities | 285,894 | 164,130 |
| Current portion of operating lease liabilities, (including amounts from related parties) | 18,051 | 14,402 |
| Current portion of long-term debt | 16,301 | 22,984 |
| Total current liabilities | 659,993 | 411,109 |
| Long-term debt, net of current portion, (including amounts from related parties) | 812,628 | 1,585,846 |
| Operating lease liabilities, net of current portion, (including amounts from related parties) | 94,568 | 80,669 |
| Tax receivable agreement liability – related party | 146,474 | — |
| Deferred tax liabilities, net | 41,543 | 35,428 |
| Other long-term liabilities | 17,590 | 35,856 |
| Total liabilities | 1,772,796 | 2,148,908 |
| Stockholders’ equity / Member’s equity | ||
| Member’s equity | — | 443,738 |
| Preferred stock | — | — |
| Class A common stock | 585 | — |
| Class B common stock | 467 | — |
| Additional paid-in capital | 664,299 | — |
| Accumulated deficit | -277,228 | -250,169 |
| Accumulated other comprehensive (loss) income | -248 | 9,111 |
| Total Legence stockholders’ equity / Member’s equity | 387,875 | 202,680 |
| Noncontrolling interests | 439,598 | 912 |
| Total stockholders’ equity / Member’s equity | 827,473 | 203,592 |
| Total liabilities and stockholders’ equity / Member’s equity | 2,600,269 | 2,352,500 |