Legence Raises 2026 Outlook After Record Quarter
Second-quarter revenue hit a record $1.26 billion, up 110.7% from a year earlier, and the company lifted full-year revenue guidance to $4.7 billion to $4.8 billion.
Legence Corp. (LGN) reported record second-quarter revenue of $1.26 billion, a 110.7% increase from $598.9 million a year earlier, and raised its full-year 2026 outlook for both revenue and non-GAAP Adjusted EBITDA after another quarter of double-digit growth in the Installation & Maintenance franchise.
The engineering, installation and maintenance contractor said year-over-year growth accelerated from 105.1% in the first quarter, when revenue was $1.04 billion. Excluding about $303.8 million of Bowers Group revenue, non-GAAP growth was 60.0%, versus 57.1% in the prior quarter.
Chief Executive Officer Jeff Sprau said strong customer demand produced new highs in revenue, Adjusted EBITDA and backlog, and that data centers and technology remained a significant driver while life sciences and healthcare, state and local government, and education also contributed.
Installation & Maintenance was the engine of the mix. Segment revenue was $1.06 billion, or 83.6% of the total, up 162.0% from $402.8 million a year earlier. Excluding Bowers, the segment grew 86.6%. Installation & Fabrication accounted for $924.9 million, or 87.6% of the segment, and Maintenance & Service for $130.4 million. The increase was driven by strong demand for Installation & Fabrication, primarily from data centers and technology clients, with Maintenance & Service growth from data centers and technology, education, state and local government, and life sciences and healthcare.
Engineering & Consulting revenue was $206.9 million, or 16.4% of the mix, up 5.5% from $196.1 million a year earlier. Program & Project Management was $104.5 million and Engineering & Design $102.3 million. Higher demand for Program & Project Management, primarily from state and local government and data centers and technology clients, was partially offset by lower Engineering & Design revenue from mixed-use clients.
Non-GAAP Adjusted EBITDA was $154.6 million, up 114.1% from $72.2 million a year earlier, with an Adjusted EBITDA margin of 12.2%. Sequential Adjusted EBITDA rose from $118.1 million in the first quarter.
GAAP gross margin compressed to 17.4% from 21.5% a year earlier. Non-GAAP Adjusted Gross Margin was 18.5%, versus 21.8% a year earlier. The decline was primarily attributable to a revenue mix shift toward Installation & Maintenance and a slight decline in Engineering & Consulting Adjusted Gross Margin.
In Engineering & Consulting, GAAP gross profit fell 12.4% to $56.1 million from $64.1 million a year earlier. Non-GAAP Adjusted Gross Profit was $64.3 million and Adjusted Gross Margin 31.1%, versus 33.2% a year earlier. The margin decline was driven by a mix shift toward Program & Project Management and rising indirect customer fulfillment costs.
Installation & Maintenance GAAP gross profit was $164.1 million with a margin of 15.5%. Non-GAAP Adjusted Gross Profit was $169.6 million and Adjusted Gross Margin 16.1%. The slight margin decline reflected an increase in Installation & Fabrication mix and lower service-line margins, largely offset by greater economies of scale in customer fulfillment support costs.
Net loss attributable to Legence widened to $27.8 million, or $(0.37) a share, from a $5.3 million loss a year earlier, after $21.6 million of goodwill impairment and $19.5 million of long-lived asset impairment in the quarter.
Total backlog and awarded contracts reached a record $5.67 billion, up 104.6% from $2.77 billion a year earlier. Installation & Maintenance backlog rose 141.2% and Engineering & Consulting 26.6%. The book-to-bill ratio was 1.2x, matching the first quarter.
Cash and equivalents were $292.0 million and total debt $1.03 billion at June 30, 2026, for net leverage of 1.6 times on last-twelve-months Adjusted EBITDA, or 1.5 times including Bowers EBITDA for the six months ended December 31, 2025.
Legence set third-quarter 2026 guidance for revenue of $1.225 billion to $1.275 billion and non-GAAP Adjusted EBITDA of $150 million to $160 million, above the prior quarter’s $1.05 billion to $1.1 billion revenue and $115 million to $125 million EBITDA guidance. Full-year 2026 guidance was raised to revenue of $4.7 billion to $4.8 billion and non-GAAP Adjusted EBITDA of $565 million to $585 million, from $4.1 billion to $4.3 billion and $470 million to $490 million. Sprau said healthy industry conditions and backlog-supported visibility gave the company confidence to raise the year’s revenue and profit outlook.