MasTec Inc Q1 2025 Earnings Call Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Sangita Jain - KeyBanc Capital Markets - Analyst : Good morning. Thank you for taking my questions. Jose and Paul, if you could just give us a little more detail on the oil and gas bookings, maybe the geographies where you're seeing most interest and if these bookings came in maybe a little bit sooner than you were expecting?

Question: Sangita Jain - KeyBanc Capital Markets - Analyst : Great. And if I can ask a follow-up on capital allocation. I know Paul just mentioned tuck-in type acquisitions or buybacks. Could you help us end markets that you feel would be more suitable for MasTec at this point where you could look for acquisitions?

Question: Sangita Jain - KeyBanc Capital Markets - Analyst : Thank you so much for taking my question. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 1:00PM, MTZ.N - Q1 2025 MasTec Inc Earnings Call

Question: Jamie Cook - Truist Securities - Analyst : Hi, good morning and congrats on a nice quarter. I guess my first question, Jose, sorry, back on the pipeline business again. I think you said last quarter that given what you saw in terms of booking potentials, you thought revenues and pipeline in 2026 could potentially be at 2024 level. So I'm sorry if I missed it because there's multiple calls going on. But can you just sort of give us an update on your thoughts there and your confidence level? And I guess within pipeline, just the competitive environment, I would assume it's the projects are yours to sort of lose, I guess, is I would say with no one else in it. And then my second question, just the color on the power delivery. It sounded like the margins were off to a slower start than what you thought. Just a little more color there. And I think you said the same thing on the -- I can't remember what other business, maybe it was Clean Energy, but I guess I'm trying to understand what the true earnings power of the quarter would be if we didn't have that noise and obviously, the implications of what that would mean for your full year guide? Thanks.

Question: Jamie Cook - Truist Securities - Analyst : Thanks and congratulations.

Question: Andy Kaplowitz - Citi - Analyst : Thanks everyone. Marc, it's been a true pleasure. We'll miss you. Jose, could you give us more color into what you're seeing in communications? You beat your rev guidance on Q1, raised your outlook for the year. But I think there's some consternation out there that at least fiscal stimulus, whether it's start off, it could be slowed a bit. I know that BEAD hasn't been in your guidance. It's still wireline growing faster than wireless for you? When do you fully ramp up and all the market share wins that you've had and/or the fiber to data center opportunity?

Question: Andy Kaplowitz - Citi - Analyst : And Jose, maybe just stepping back, I asked you this last quarter, but I think I need to ask you again, frankly, it doesn't seem fair after you booked so much this quarter. But Paul just mentioned booking more work in clean energy in Q2 than you did in Q1. So maybe you can talk about whether you can continue to sequentially grow backlog in this environment? And have you noticed any changes in your customers' conversations or behavior since Liberation Day?

Question: Andy Kaplowitz - Citi - Analyst : Appreciate all the color.

Question: Atidrip Modak - Goldman Sachs - Analyst : Hey, good morning team. Jose, can you talk about the nature of the pipeline projects that you've booked already? You highlighted two larger ones. Are those long-haul pipelines, what's in the small ones? And how should we think about the order sizes in the second half of the year as you look at contracting? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 1:00PM, MTZ.N - Q1 2025 MasTec Inc Earnings Call

Question: Atidrip Modak - Goldman Sachs - Analyst : Thank you. And then on the framework agreements you spoke about, can you give us any more color there and how that de-risks your forward backlog visibility, especially in a world where the market might be concerned about things like IRA, for instance, I think you said framework agreements are across segments. So maybe any color there.

Question: Atidrip Modak - Goldman Sachs - Analyst : That's very helpful, Jose. Thank you.

Question: Steven Fisher - UBS - Analyst : But thanks, good morning and congrats on a a great quarter. Just wanted to come back to follow up on Andy's question on the communications. I mean, clearly, you have a lot of opportunities there and a great setup for '26. But -- and your slide is very helpful. And just looking at that slide shows that your second half of the year in communications is pretty flat with last year. So just curious, I'm sure it's just sort of timing, but why in light of all the trends here, only flat revenue growth in communications in the second half of the year?

Question: Steven Fisher - UBS - Analyst : Makes good sense. And then a similar question on the pipeline side. Obviously, very strong bookings. It sounds like you've got more to come. And you did only raise the guidance there by about $75 million. So I'm curious if there were any offsets to that? And I would think, typically, on these pipeline projects, especially if they're not like they're really huge ones, the time between booking and actually getting started is usually fairly short, if I understand that correctly. So I'm just curious, is that conservatism again? Are there permits that need to be kind of arranged here? Why isn't that ramping up a bit sooner?

Question: Steven Fisher - UBS - Analyst : Sounds good. Thanks very much. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 1:00PM, MTZ.N - Q1 2025 MasTec Inc Earnings Call

Question: Justin Hauke - Robert W. Baird - Analyst : Great. I guess, I wanted to ask on the power delivery and some of the large transmission lines that have been announced like in the Texas region. And just -- I know you talked about in the past that you've got capacity to do like another Greenlink and you feel comfortable about that. And I guess I was just going to ask just any kind of geographic strength where you feel maybe you've got a more competitive position on winning something of that size? I don't know if it's just in the West or Texas would include that? And then I guess the corollary to that is just looking at your head count, it's actually down a little bit year-over-year despite the growth. And so just thinking about where you see head count going against kind of the growth trends that you're seeing and your ability to kind of ramp up training and staffing to meet that? Thank you.

Question: Justin Hauke - Robert W. Baird - Analyst : Okay. Thanks for that perspective. My second one would just be, you talked a lot about the indirect benefit from the data center infrastructure, but I know you also have some direct work that you've done for them, I think, about $200 million that you did last REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 1:00PM, MTZ.N - Q1 2025 MasTec Inc Earnings Call year. I guess, just any update on maybe some of the direct work that you've won and thinking about the revenue potential for that business in '25? And that's my last question. Thank you.

Question: Drew Chamberlain - JPMorgan - Analyst : Yeah, thanks for taking the questions. First one, just on the renewable side. I mean how is that -- to the extent that some of these projects might end up facing delays, so into tariffs or other sorts of policy concerns. I mean do you think you have an ability to pull in other projects or replace teams onto other areas of work to backfill whatever could come of any revenue holes?

Question: Drew Chamberlain - JPMorgan - Analyst : Okay. Great. Makes sense. And then just I appreciate the revenue color for '25 from Greenlink there. I think that might have been a bit more than some folks had been thinking was going to come in, in '25. Can you just talk a little bit about how that project is starting and what additional color you can provide about revenue cadence throughout the next couple of years there? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 1:00PM, MTZ.N - Q1 2025 MasTec Inc Earnings Call

Question: Drew Chamberlain - JPMorgan - Analyst : Great. Thanks, Jose.

Question: Liam Burke - B. Riley - Analyst : Thank you. Good morning, Jose.

Question: Liam Burke - B. Riley - Analyst : Jose, you touched on in one of your earlier questions on LNG. Is your pipeline business seeing any benefit now? Or is that something on the holdback that we can expect in the future?

Question: Liam Burke - B. Riley - Analyst : Great. And on the regulatory front, there's been a lot of chatter, obviously, about the renewables, but have you seen any positive benefits of deregulation? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 1:00PM, MTZ.N - Q1 2025 MasTec Inc Earnings Call

Question: Liam Burke - B. Riley - Analyst : Great. Thank you Jose.

Question: Brian Brophy - Stifel - Analyst : Thanks, good morning everybody. Just one for me. You guys took down depreciation guidance a bit here. And obviously, it's already down a bit from last year. Can you talk about the drivers for that change? And then how you're thinking about any structural changes to the capital requirements for the business? Thanks.

Question: Brian Brophy - Stifel - Analyst : Thanks, I'll pass it on.

Question: Joseph Osha - Guggenheim Partners - Analyst : Good morning. Thanks for taking my question. Just sort of a two-part question. First, looking at your leverage, it ticked back up a little bit. I'm wondering how we should think about the longer-term target. I know there's been some talk about maybe continuing to drive that lower. And then secondly, looking at the buybacks, Jose, you talked about picking up the stock when it falls below intrinsic value. Can we think about some rough time frame in terms of executing this new $250 million? Or is it going to be dependent upon the price of the stock? Thank you.

Question: Joseph Osha - Guggenheim Partners - Analyst : Thank you very much. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 02, 2025 / 1:00PM, MTZ.N - Q1 2025 MasTec Inc Earnings Call

Question: Kashy Harrison - Piper Sandler - Analyst : Good morning, and, thank you for taking my questions. So based on the commentary today, it sounds like you're expecting continued bookings growth through year-end despite all the tariff uncertainty. What's behind that viewpoint? Is that just based on discussions you're having with your customers? And can you share your perspective on why that tariff uncertainty isn't driving more delays in order activity?

Question: Kashy Harrison - Piper Sandler - Analyst : That's really great color. Thank you. And then just for my follow-up question, just going back to the discussions on pipeline. You talked about potentially revisiting 2023 revenue levels or greater in the -- sorry, yes, '24 levels, sorry, by 2026. Can you help us think through the path towards -- or if there is a path towards your prior 2017 peak of $3.5 billion or even the more recent peak of $2.5 billion. Just trying to think about where that business could go, not necessarily in one year, but on a multiyear basis? Thank you.

Question: Kashy Harrison - Piper Sandler - Analyst : Thank you.

Question: Adam Thalhimer - Thompson Davis - Analyst : Thanks. Good quarter, guys. Marc, congratulations on your retirement. And Chris, welcome to the call. Most of my questions have been asked, I did want to ask you on power delivery. The market challenges you saw in distribution last year, are those behind you

Question: Adam Thalhimer - Thompson Davis - Analyst : I'll turn it over. Thanks.