Dycom Industries, Inc.

Good day and thank you for standing by. Welcome to the DICOM Industry Think second quarter 2026 results conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to Ms. Callie Tommaso, DICOM's Vice President of Investor Relations. Please go ahead.

Thank you, Operator, and good morning, everyone. Welcome to DICOM's second quarter fiscal 2026 results conference call. Joining me today are Dan Paevich, our President and Chief Executive Officer, and Drew DeFerrari, our Chief Financial Officer. Earlier this morning, we released our fiscal 2026 second quarter results along with certain outlook information. The press release and accompanying materials are available in the investor relations section of our website. Today's discussion will include forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995. These statements reflect our expectations, assumptions, and beliefs regarding future events and are subject to risks and uncertainties that could cause actual results to differ materially. A detailed discussion of these risks and uncertainties is included in our filings with the SEC. Forward-looking statements are made as of today's date, and we undertake no obligation to update them. Additionally, we will reference certain non-GAAP financial measures during today's call. Explanations of these measures and reconciliations to the most directly comparable GAAP measures can be found in our press release and accompanying materials. With that, I will turn the call over to Dan Panavich.

Thank you, Callie, and good morning, everyone. We appreciate you joining us today. This quarter, we demonstrated the power of our strategy as we continue to execute against the rapidly expanding addressable market. We delivered a quarter of record revenue within our range of expectations and record EBITDA and EPS that exceeded our expectations, a direct result of operating leverage, increased efficiencies, and a discipline focused on operational excellence. Our revenue for the quarter was $1.38 billion, a 14.5% increase over the prior year. This top-line growth, combined with our strategic initiatives, drove adjusted EBITDA to $205.5 million, representing a 14.9% margin and a 29.8% increase over the prior year. Our commitment to efficient cash flow management also paid off. as we improved our DSOs by nine days year-over-year, ending the quarter at 108 days. We finished the quarter with a total backlog of $8 billion and next 12 months backlog of $4.6 billion. This represents a year-over-year increase of 16.9% and 20.2% respectively. We continue to cultivate a healthy pipeline and diverse customer and program opportunities. As a reminder, the size and complexity of these opportunities can lead to short-term variation in reported backlog, resulting from the timing of when contracts are signed. With that in mind, shortly after the quarters closed, we secured a significant new award for both service and maintenance and fiber to the homework across numerous states. This award will be reported in our Q3 backlog, and it's a clear testament to DICOM's breadth of capabilities across our national footprint. We continue to see a marketplace of unprecedented opportunity as our customers' ambitious plans grow. The increasing addressable market, coupled with our proven ability to execute, bolster our confidence to achieve our full-year growth target. As a result, we are reaffirming our fiscal 26 revenue outlook range of $5.29 billion to $5.425 billion. The demand for digital infrastructure is accelerating, and DICOM is uniquely positioned to lead. our customers are actively seeking partners with a scale and national reach to meet their ambitious goals. Shortly after the Q1 earnings call, AT&T and Lumen announced AT&T's acquisition of the majority of Lumen's mass market segment. With this announcement, both companies affirmed their current Fiber to the Home bill projections for calendar 25, and AT&T increased their total expected Fiber to the Home passings to 60 million, an increase of 10 million from their prior estimate. now incorporating the Lumen footprint. Collectively, our customers' fiber-to-the-home build plans comprise over 125 million passings, more than 50 million of which are incremental in the past 16 months. While the pace of these builds is not always linear, the opportunities for continued growth over the coming years are significant, and we continue to believe we'll extend well beyond 2030. It's important to note that beyond the market growth we're anticipating, we also expect to realize incremental opportunities driven by the shift we've seen among our customers to consolidate their engineering, construction, and service and maintenance partners. We continue to strengthen our portfolio, and this quarter, extended fiber to the home agreements and secured new fiber to the home markets across numerous customers.