Jacobs Solutions (NYSE: J) grows revenue but boosts debt to complete PA Consulting buy
Filing Impact
Filing Sentiment
Form Type
10-Q
Jacobs Solutions Inc. reported strong top-line growth but a quarterly loss as it completed its purchase of PA Consulting. For the quarter ended March 27, 2026, revenue rose to $3.69 billion from $2.91 billion a year earlier, but higher selling, general and administrative costs and PA-related items drove an operating loss of $81.2 million and a net loss attributable to Jacobs of $45.9 million, or $(0.34) per share.
For the first six months, revenue reached $6.99 billion and net earnings attributable to Jacobs were $79.6 million, or $0.79 per share. Jacobs closed the £1.21 billion PA Consulting Transaction, paying about £997.6 million in cash and issuing 2,043,537 new shares, and will owe an additional £75 million in 2028. Long‑term debt increased to $4.08 billion from $2.24 billion, reflecting new term loans and bond issuances used to finance the deal, while net cash from operating activities for the six months was a use of $103 million. The company ended the period with $1.49 billion in cash and cash equivalents and reported about $19.0 billion in remaining performance obligations, with 47% expected to convert to revenue within 12 months.
Positive
- Strong revenue growth: Quarterly revenue increased to $3.69 billion from $2.91 billion, and six‑month revenue reached $6.99 billion, reflecting solid demand across geographies and services.
- Completion of PA Consulting acquisition: Jacobs closed the £1.21 billion PA Consulting Transaction, gaining full ownership of the business and eliminating Redeemable Noncontrolling Interests.
- Robust backlog: Remaining performance obligations totaled approximately $19.0 billion, with about 47% expected to convert to revenue within the next twelve months.
Negative
- Quarterly net loss: Jacobs posted a net loss attributable to the company of $45.9 million, or $(0.34) per share, for the quarter, driven by higher costs and transaction-related items.
- Higher leverage: Long‑term debt rose to $4.08 billion from $2.24 billion, reflecting new term loans and bond issuances used to fund the PA Consulting Transaction.
- Weak near-term cash generation: Net cash from operating activities for the six months was a use of $103.4 million, compared with positive operating cash flow in the prior year period.
Insights
Revenue is growing and PA Consulting is fully acquired, but leverage and near-term earnings pressure have increased.
Jacobs Solutions is reshaping its portfolio. Quarterly revenue grew to $3.69 billion from $2.91 billion, helped by broad-based demand and consolidation of PA Consulting. However, higher SG&A, restructuring and PA-related compensation costs pushed operating results to a loss.
Completion of the £1.21 billion PA Consulting Transaction makes PA a wholly owned segment and removes redeemable noncontrolling interests. The deal was funded with £997.6 million in cash, new shares and additional term loans and bonds, lifting long-term debt to $4.08 billion from $2.24 billion.
Despite a six‑month profit of $79.6 million, cash generation weakened, with operating activities using $103.4 million. At the same time, Jacobs repurchased 3.39 million shares for $471.8 million and continues paying a rising dividend. A sizeable $19.0 billion backlog of remaining performance obligations, nearly half due within a year, provides revenue visibility as integration and restructuring charges roll through future quarters.
Key Figures
Quarterly revenue: $3.69B
Quarterly net loss per share: $(0.34)
Six‑month net earnings: $79.6M
+5 more
8 metrics
Quarterly revenue
$3.69B
Revenue for the three months ended March 27, 2026 (vs. $2.91B prior-year quarter)
Quarterly net loss per share
$(0.34)
Diluted loss per share attributable to Jacobs for Q2 FY2026
Six‑month net earnings
$79.6M
Net earnings attributable to Jacobs for six months ended March 27, 2026
Long-term debt
$4.08B
Total long-term debt, net, as of March 27, 2026 (vs. $2.24B at September 26, 2025)
Net cash from operating activities
-$103.4M
Net cash used for operating activities for the six months ended March 27, 2026
PA Consulting consideration
£1.21B
Aggregate initial consideration for PA Consulting Transaction on March 20, 2026
Remaining performance obligations
$19.0B
Backlog as of March 27, 2026; 47% expected to be recognized within twelve months
Share repurchases
$471.8M / 3.39M shares
Repurchases under 2025 authorization through Q2 FY2026 at $139.21 average price
Key Terms
Reverse Morris Trust transaction, remaining performance obligations, Redeemable Noncontrolling Interests, effective tax rate, +1 more
5 terms
Reverse Morris Trust transaction financial
"completed the previously announced Reverse Morris Trust transaction pursuant to which (i) Jacobs first transferred its Critical Mission Solutions"
remaining performance obligations financial
"The Company’s remaining performance obligations as of March 27, 2026 represent a measure of the total dollar value of work"
Remaining performance obligations are the work a company still needs to complete for its customers, like finishing a service or delivering a product. It’s important because it shows how much future income the company has coming in from current agreements, giving a clearer picture of its ongoing business.
Redeemable Noncontrolling Interests financial
"As a result of the PA Consulting Transaction, the Company no longer carries Redeemable Noncontrolling Interests on the Jacobs Consolidated Financial Statements"
A redeemable noncontrolling interest is a minority ownership stake in a company that the holder can force the company to buy back at a set price or under certain conditions. For investors this matters because it creates a future cash obligation and can be treated more like a liability than permanent equity, affecting a company’s reported debt, net income and valuation — think of it as a part-owner who can cash out, forcing the business to pay them.
effective tax rate financial
"The Company’s effective tax rates from continuing operations for the three months ended March 27, 2026 and March 28, 2025 were 34.5 % and 90.6 %"
The effective tax rate is the percentage of a company's profits that it pays in taxes. It shows how much of its earnings go to taxes after all deductions and credits are considered. For investors, it indicates how much of the company's income is taken by taxes, impacting overall profitability and financial health.
Transition Services Agreement financial
"the Company entered into a Transition Services Agreement (the "TSA") with Amentum pursuant to which the Company, on an interim basis, will provide various services"
A transition services agreement is a formal arrangement where one company continues to provide essential services—such as IT, human resources, or accounting—to another company after a business deal or change in ownership. It acts like a temporary bridge, ensuring smooth operations during a transition period. For investors, it provides clarity on how long support will last and helps assess potential costs and stability during the change.
Earnings Snapshot
Revenue: $3.69B
Q2 FY2026
Revenue
$3.69B
Net loss attributable to Jacobs (quarter)
$45.9M
Diluted EPS (quarter)
$(0.34)
Net earnings attributable to Jacobs (six months)
$79.6M
Net cash from operating activities (six months)
-$103.4M
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark one)
For the quarterly period ended March 27, 2026
For the transition period from to
Commission File Number 1-7463
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification Number) | |||||||||||||
| (Address of principal executive offices) | (Zip Code) | |||||||||||||
(214 ) 583 – 8500
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
_________________________________________________________________
| Title of Each Class | Trading Symbol(s) | Name of Each Exchange on Which Registered | |||||||||
| $1 par value | |||||||||||
Indicate by check-mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days: ☒ Yes ☐ No
Indicate by check-mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). ☒ Yes ☐ No
Page 1
Indicate by check-mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| ☒ | Accelerated filer | ☐ | ||||||||||||
| Non-accelerated filer | ☐ | Smaller reporting company | ||||||||||||
| Emerging growth company | ||||||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check-mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ☐ Yes ☒ No
Number of shares of common stock outstanding at April 24, 2026: 118,080,879
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JACOBS SOLUTIONS INC.
INDEX TO FORM 10-Q
| Page No. | |||||||||||
| PART I | FINANCIAL INFORMATION | ||||||||||
| Item 1. | Financial Statements | 4 | |||||||||
Consolidated Balance Sheets - Unaudited | 5 | ||||||||||
Consolidated Statements of Earnings - Unaudited | 6 | ||||||||||
Consolidated Statements of Comprehensive Income (Loss) - Unaudited | 7 | ||||||||||
Consolidated Statements of Stockholders’ Equity - Unaudited | 8 | ||||||||||
Consolidated Statements of Cash Flows - Unaudited | 10 | ||||||||||
Notes to Consolidated Financial Statements - Unaudited | 11 | ||||||||||
| Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | 37 | |||||||||
| Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 54 | |||||||||
| Item 4. | Controls and Procedures | 55 | |||||||||
| PART II | OTHER INFORMATION | ||||||||||
| Item 1. | Legal Proceedings | 56 | |||||||||
| Item 1A. | Risk Factors | 56 | |||||||||
| Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 56 | |||||||||
| Item 3. | Defaults Upon Senior Securities | 57 | |||||||||
| Item 4. | Mine Safety Disclosures | 57 | |||||||||
| Item 5. | Other Information | 57 | |||||||||
| Item 6. | Exhibits | 58 | |||||||||
SIGNATURES | 60 | ||||||||||
Page 3
Part I - FINANCIAL INFORMATION
Item 1. Financial Statements.
Page 4
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share information)
| March 27, 2026 | September 26, 2025 | ||||||||||
| (Unaudited) | |||||||||||
| ASSETS | |||||||||||
| Current Assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Receivables and contract assets | |||||||||||
| Prepaid expenses and other | |||||||||||
| Total current assets | |||||||||||
| Property, Equipment and Improvements, net | |||||||||||
| Other Noncurrent Assets: | |||||||||||
| Goodwill | |||||||||||
| Intangibles, net | |||||||||||
| Deferred income tax assets | |||||||||||
| Operating lease right-of-use assets | |||||||||||
| Miscellaneous | |||||||||||
| Total other noncurrent assets | |||||||||||
| $ | $ | ||||||||||
| LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
| Current Liabilities: | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Accrued liabilities | |||||||||||
| Operating lease liabilities | |||||||||||
| Contract liabilities | |||||||||||
| Total current liabilities | |||||||||||
| Long-term debt | |||||||||||
| Liabilities relating to defined benefit pension and retirement plans | |||||||||||
| Deferred income tax liabilities | |||||||||||
| Long-term operating lease liabilities | |||||||||||
| Other deferred liabilities | |||||||||||
| Total other noncurrent liabilities | |||||||||||
| Commitments and Contingencies | |||||||||||
| Redeemable Noncontrolling interests | |||||||||||
| Stockholders’ Equity: | |||||||||||
| Capital stock: | |||||||||||
Preferred stock, $ | |||||||||||
Common stock, $ | |||||||||||
| Additional paid-in capital | |||||||||||
| Retained earnings | |||||||||||
| Accumulated other comprehensive loss | ( | ( | |||||||||
| Total Jacobs stockholders’ equity | |||||||||||
| Noncontrolling interests | ( | ||||||||||
| Total Group stockholders’ equity | |||||||||||
| $ | $ | ||||||||||
See the accompanying Notes to Consolidated Financial Statements – Unaudited.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
Three and Six Months Ended March 27, 2026 and March 28, 2025
(In thousands, except per share information)
(Unaudited)
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
| March 27, 2026 | March 28, 2025 | March 27, 2026 | March 28, 2025 | ||||||||||||||||||||
| Revenues | $ | $ | $ | $ | |||||||||||||||||||
| Direct cost of contracts | ( | ( | ( | ( | |||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Selling, general and administrative expenses | ( | ( | ( | ( | |||||||||||||||||||
| Operating (loss) profit | ( | ||||||||||||||||||||||
| Other Income (Expense): | |||||||||||||||||||||||
Interest income | |||||||||||||||||||||||
Interest expense | ( | ( | ( | ( | |||||||||||||||||||
Loss on extinguishment of debt | ( | ( | |||||||||||||||||||||
| Miscellaneous expense | ( | ( | ( | ( | |||||||||||||||||||
Total other expense, net | ( | ( | ( | ( | |||||||||||||||||||
| (Loss) Earnings from Continuing Operations Before Taxes | ( | ||||||||||||||||||||||
| Income Tax Benefit (Expense) from Continuing Operations | ( | ( | ( | ||||||||||||||||||||
| Net (Loss) Earnings of the Group from Continuing Operations | ( | ||||||||||||||||||||||
| Net Loss of the Group from Discontinued Operations, net of tax | ( | ( | ( | ( | |||||||||||||||||||
| Net (Loss) Earnings of the Group | ( | ( | ( | ||||||||||||||||||||
| Net Loss Attributable to Noncontrolling Interests from Continuing Operations | |||||||||||||||||||||||
| Net Loss (Earnings) Attributable to Redeemable Noncontrolling Interests | ( | ( | |||||||||||||||||||||
| Net (Loss) Earnings Attributable to Jacobs from Continuing Operations | ( | ( | |||||||||||||||||||||
| Net Loss Attributable to Jacobs from Discontinued Operations | ( | ( | ( | ( | |||||||||||||||||||
| Net (Loss) Earnings Attributable to Jacobs | $ | ( | $ | $ | $ | ( | |||||||||||||||||
| Net Earnings Per Share: | |||||||||||||||||||||||
| Basic Net (Loss) Earnings from Continuing Operations Per Share | $ | ( | $ | $ | $ | ||||||||||||||||||
| Basic (Loss) from Discontinuing Operations Per Share | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Basic (Loss) Earnings Per Share | $ | ( | $ | $ | $ | ( | |||||||||||||||||
| Diluted Net (Loss) Earnings from Continuing Operations Per Share | $ | ( | $ | $ | $ | ||||||||||||||||||
| Diluted (Loss) from Discontinuing Operations Per Share | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Diluted (Loss) Earnings Per Share | $ | ( | $ | $ | $ | ( | |||||||||||||||||
See the accompanying Notes to Consolidated Financial Statements - Unaudited.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Three and Six Months Ended March 27, 2026 and March 28, 2025
(In thousands)
(Unaudited)
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
| March 27, 2026 | March 28, 2025 | March 27, 2026 | March 28, 2025 | ||||||||||||||||||||
| Net (Loss) Earnings of the Group | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||
| Other Comprehensive (Loss) Income: | |||||||||||||||||||||||
| Foreign currency translation adjustments | ( | ( | ( | ||||||||||||||||||||
| Change in cash flow hedges | ( | ( | ( | ( | |||||||||||||||||||
| Change in pension plan liabilities | ( | ||||||||||||||||||||||
| Other Comprehensive (Loss) Income Before Taxes | ( | ( | ( | ||||||||||||||||||||
| Income Tax Benefit (Expense): | |||||||||||||||||||||||
| Cash flow hedges | |||||||||||||||||||||||
| Change in pension plan liabilities | ( | ( | ( | ( | |||||||||||||||||||
| Income Tax (Expense) Benefit: | ( | ( | ( | ||||||||||||||||||||
| Net Other Comprehensive (Loss) Income | ( | ( | ( | ||||||||||||||||||||
| Net Comprehensive (Loss) Income of the Group | ( | ( | |||||||||||||||||||||
| Net Loss Attributable to Noncontrolling Interests | |||||||||||||||||||||||
| Net Loss (Earnings) Attributable to Redeemable Noncontrolling Interests | ( | ( | |||||||||||||||||||||
| Net Comprehensive (Loss) Income Attributable to Jacobs | $ | ( | $ | $ | $ | ( | |||||||||||||||||
See the accompanying Notes to Consolidated Financial Statements - Unaudited.
Page 7
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
For the Three Months Ended March 27, 2026 and March 28, 2025
(In thousands)
(Unaudited)
| Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Jacobs Stockholders’ Equity | Noncontrolling Interests | Total Group Stockholders’ Equity | |||||||||||||||||||||||||||||||||||
| Balances at December 27, 2024 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||
| Net earnings (loss) | — | ( | ( | ||||||||||||||||||||||||||||||||||||||
| Foreign currency translation adjustments | — | — | — | — | |||||||||||||||||||||||||||||||||||||
Pension plan liability, net of deferred taxes of $ | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||
Change in cash flow hedges, net of deferred taxes of $( | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Dividends | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Redeemable Noncontrolling interests redemption value adjustment | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Repurchase and issuance of redeemable noncontrolling interests | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Noncontrolling interests - distributions and other | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
| Distribution adjustments relating to SpinCo Business | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Stock based compensation | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Issuances of equity securities including shares withheld for taxes | ( | — | — | ||||||||||||||||||||||||||||||||||||||
| Repurchases of equity securities | ( | ( | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
Balances at March 28, 2025 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||
| Balances at December 26, 2025 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||
Net loss | — | — | ( | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||
Foreign currency translation adjustments | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||
Pension plan liability, net of deferred taxes of $ | — | — | — | — | |||||||||||||||||||||||||||||||||||||
Change in cash flow hedges, net of deferred taxes of $( | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Dividends | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Redeemable Noncontrolling interests redemption value adjustment | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Redemption of redeemable noncontrolling interests relating to the PA Consulting Transaction | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Noncontrolling interests - distributions and other | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
| Stock based compensation | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Issuances of equity securities including shares withheld for taxes | ( | — | — | ||||||||||||||||||||||||||||||||||||||
| Repurchases of equity securities | ( | ( | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Balances at March 27, 2026 | $ | $ | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
See the accompanying Notes to Consolidated Financial Statements – Unaudited.
Page 8
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
For the Six Months Ended March 27, 2026 and March 28, 2025
(In thousands)
(Unaudited)
| Common Stock | Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Income (Loss) | Total Jacobs Stockholders’ Equity | Noncontrolling Interests | Total Group Stockholders’ Equity | |||||||||||||||||||||||||||||||||||
| Balances at September 27, 2024 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||
| Net loss | — | — | ( | — | ( | ( | ( | ||||||||||||||||||||||||||||||||||
| Foreign currency translation adjustments | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||
Pension liability, net of deferred taxes of $ | — | — | — | — | |||||||||||||||||||||||||||||||||||||
Change in cash flow hedges, net of deferred taxes of $( | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Dividends | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Redeemable Noncontrolling interests redemption value adjustment | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Repurchase of redeemable noncontrolling interests | |||||||||||||||||||||||||||||||||||||||||
| Noncontrolling interests - distributions and other | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
| Distribution adjustments relating to SpinCo Business | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Stock based compensation | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Issuances of equity securities including shares withheld for taxes | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||||
| Repurchases of equity securities | ( | ( | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Balances at March 28, 2025 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||
| Balances at September 26, 2025 | $ | $ | $ | $ | ( | $ | $ | $ | |||||||||||||||||||||||||||||||||
| Net earnings (loss) | — | — | — | ( | |||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustments | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||
Pension liability, net of deferred taxes of $ | — | — | — | — | |||||||||||||||||||||||||||||||||||||
Change in cash flow hedges, net of deferred taxes of $( | — | — | — | ( | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Dividends | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Redeemable Noncontrolling interests redemption value adjustment | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Repurchase and issuance of redeemable noncontrolling interests | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Redemption of redeemable noncontrolling interests relating to the PA Consulting Transaction | — | — | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Noncontrolling interests - distributions and other | — | — | — | — | — | ( | ( | ||||||||||||||||||||||||||||||||||
| Stock based compensation | — | — | — | — | |||||||||||||||||||||||||||||||||||||
| Issuances of equity securities including shares withheld for taxes | ( | — | — | ||||||||||||||||||||||||||||||||||||||
| Repurchases of equity securities | ( | ( | ( | — | ( | — | ( | ||||||||||||||||||||||||||||||||||
| Balances at March 27, 2026 | $ | $ | $ | $ | ( | $ | $ | ( | $ | ||||||||||||||||||||||||||||||||
See the accompanying Notes to Consolidated Financial Statements – Unaudited.
Page 9
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the Six Months Ended March 27, 2026 and March 28, 2025
(In thousands)
(Unaudited)
See the accompanying Notes to Consolidated Financial Statements – Unaudited.
| For the Six Months Ended | |||||||||||
| March 27, 2026 | March 28, 2025 | ||||||||||
| Cash Flows from Operating Activities: | |||||||||||
| Net Earnings (Loss) of the Group | $ | $ | ( | ||||||||
| Adjustments to reconcile net earnings (loss) to net cash flows (used for) provided by operations: | |||||||||||
| Depreciation and amortization: | |||||||||||
| Property, equipment and improvements | |||||||||||
| Intangible assets | |||||||||||
| Loss on extinguishment of debt | |||||||||||
| Loss on investment in equity securities | |||||||||||
| Stock based compensation | |||||||||||
| Equity in earnings of operating ventures, net of return on capital distributions | ( | ( | |||||||||
| Loss (gain) on disposals of assets, net | ( | ||||||||||
| Deferred income taxes | ( | ||||||||||
| Changes in assets and liabilities: | |||||||||||
| Receivables and contract assets, net of contract liabilities | ( | ( | |||||||||
| Prepaid expenses and other current assets | ( | ( | |||||||||
| Miscellaneous other assets | |||||||||||
| Accounts payable | ( | ||||||||||
| Accrued liabilities | ( | ( | |||||||||
| Other deferred liabilities | |||||||||||
| Other, net | ( | ||||||||||
Net cash (used for) provided by operating activities | ( | ||||||||||
| Cash Flows from Investing Activities: | |||||||||||
| Additions to property and equipment | ( | ( | |||||||||
| Disposals of property and equipment and other assets | |||||||||||
| Capital contributions to equity investees, net of return of capital distributions | |||||||||||
Net cash used for investing activities | ( | ( | |||||||||
| Cash Flows from Financing Activities: | |||||||||||
| Proceeds from long-term borrowings | |||||||||||
| Repayments of long-term borrowings | ( | ( | |||||||||
| Repayments of short-term borrowings | ( | ||||||||||
| Debt issuance costs | ( | ( | |||||||||
| Proceeds from issuances of common stock | |||||||||||
| Common stock repurchases | ( | ( | |||||||||
| Taxes paid on vested restricted stock | ( | ( | |||||||||
| Cash dividends to shareholders | ( | ( | |||||||||
| Net dividends associated with noncontrolling interests | ( | ( | |||||||||
| Repurchase of redeemable noncontrolling interests | ( | ( | |||||||||
Net cash provided by financing activities | |||||||||||
| Effect of Exchange Rate Changes | ( | ( | |||||||||
| Net Increase in Cash and Cash Equivalents and Restricted Cash | |||||||||||
| Cash and Cash Equivalents, including Restricted Cash, at the Beginning of the Period | |||||||||||
| Cash and Cash Equivalents, including Restricted Cash, at the End of the Period | $ | $ | |||||||||
See the accompanying Notes to Consolidated Financial Statements – Unaudited.
Page 10
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1.Basis of Presentation
Unless the context otherwise requires:
•References herein to “Jacobs” are to Jacobs Solutions Inc. and its predecessors;
•References herein to the “Company”, “we”, “us” or “our” are to Jacobs Solutions Inc. and its consolidated subsidiaries; and
•References herein to the “Group” are to the combined economic interests and activities of the Company and the persons and entities holding noncontrolling interests in our consolidated subsidiaries.
On August 29, 2022, Jacobs Engineering Group Inc. ("JEGI"), the predecessor to Jacobs Solutions Inc., implemented a holding company structure, which resulted in Jacobs Solutions Inc. becoming the parent company of, and successor issuer to, JEGI (the "Holding Company Reorganization"). For purposes of this report, references to Jacobs and the "Company", "we", "us" or "our" or our management or business at any point prior to August 29, 2022 refer to JEGI, or JEGI and its consolidated subsidiaries as the predecessor to Jacobs Solutions Inc.
The accompanying consolidated financial statements and financial information included herein have been prepared pursuant to the interim period reporting requirements of Form 10-Q. Consequently, certain information and note disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) have been condensed or omitted. Readers of this Quarterly Report on Form 10-Q should also read our consolidated financial statements and the notes thereto included in our Annual Report on Form 10-K for the fiscal year ended September 26, 2025 (“2025 Form 10-K”).
In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary for a fair presentation of our consolidated financial statements as of March 27, 2026, and for the three and six months ended March 27, 2026.
Our interim results of operations are not necessarily indicative of the results to be expected for the full fiscal year.
Page 11
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
On January 2, 2026, Jacobs entered into an Implementation Deed (the “Implementation Deed”) with PA Consulting. Pursuant to the Implementation Deed and certain related agreements, and in accordance with the terms and conditions thereof, on March 20, 2026, Jacobs completed the transaction to acquire from shareholders of PA Consulting all of the remaining issued share capital of PA Consulting ("PA Shares") owned by the PA Consulting shareholders (excluding shares already held by Jacobs and its affiliates). The Company acquired the PA Shares for an aggregate initial consideration of approximately £1.21 billion which was paid through a combination of approximately £997.6 million in cash (net of certain PA Consulting shareholder expenses) and 2,043,537 newly issued shares of Jacobs' common stock, par value $1.00 per share (“Company Common Stock”). Also, on March 20, 2028, the Company will pay an additional £75 million in consideration with shares of Company Common Stock, cash or a combination thereof (as determined by the Company in its sole discretion), with accruals associated with this additional consideration reflected in Other deferred liabilities on the Consolidated Balance Sheet as of March 27, 2026. The transactions described in this paragraph, are collectively referred to as the “PA Consulting Transaction”. As a result of the PA Consulting Transaction, the Company no longer carries Redeemable Noncontrolling Interests on the Jacobs Consolidated Financial Statements. See Note 15- PA Consulting Redeemable Noncontrolling Interests for more discussion on the transaction and Note 12- Borrowings for more discussion on the financing for the transaction.
On September 27, 2024, Jacobs Solutions Inc. ("Jacobs") completed the previously announced Reverse Morris Trust transaction pursuant to which (i) Jacobs first transferred its Critical Mission Solutions business (“CMS”) and portions of its Divergent Solutions (“DVS”) business (referred to herein as the Cyber & Intelligence business (“C&I”) and together with CMS referred to as the “SpinCo Business”), to Amazon Holdco Inc., a Delaware corporation, that was subsequently renamed Amentum Holdings, Inc. (“SpinCo”) (the “Separation”), (ii) Jacobs then effectuated a spin-off of SpinCo by distributing 124,084,108 shares of SpinCo Common stock, par value $0.01 per share (the “SpinCo Common Stock”) by way of a pro rata distribution to its shareholders such that each holder of shares of Jacobs Common stock, par value $1.00 per share, (the “Jacobs Common Stock”) was entitled to receive one share of SpinCo Common Stock for each share of Jacobs Common Stock held as of the record date, September 23, 2024 (the “Distribution”), and (iii) finally, Amentum Parent Holdings LLC merged with and into SpinCo, with SpinCo surviving the merger (the “Merger” and together with the Separation and the Distribution, the “Separation Transaction”).
As a result of the Separation, substantially all SpinCo Business-related assets and liabilities have been separated and distributed (the "Disposal Group"). The Company determined that the Disposal Group should be reported as discontinued operations in accordance with ASC 205-20, Discontinued Operations because their disposal represents a strategic shift that had a major effect on the Company's operations and financial results. As such, the financial results of the SpinCo Business are reflected in the Company's Consolidated Statements of Earnings as well as relevant disclosures as discontinued operations for all periods presented. See Note 14- Discontinued Operations for more information.
2. Use of Estimates and Assumptions
The preparation of financial statements in conformity with U.S. GAAP requires us to employ estimates and make assumptions that affect the reported amounts of certain assets and liabilities; the revenues and expenses reported for the periods covered by the financial statements; and certain amounts disclosed in these Notes to the Consolidated Financial Statements. Although such estimates and assumptions are based on management’s most recent assessment of the underlying facts and circumstances utilizing the most current information available and past experience, actual results could differ significantly from those estimates and assumptions. Our estimates, judgments and assumptions are evaluated periodically and adjusted accordingly.
3. Fair Value and Fair Value Measurements
Certain amounts included in the accompanying consolidated financial statements are presented at fair value. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants as of the date fair value is determined (the “measurement date”). When determining fair value, we consider the principal or most advantageous market in which we would transact, and we
Page 12
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
consider only those assumptions we believe a typical market participant would consider when pricing an asset or liability. In measuring fair value, we use the following inputs in the order of priority indicated:
Level 1 - Quoted prices in active markets for identical assets or liabilities.
Level 2 - Observable inputs other than quoted prices in active markets included in Level 1, such as (i) quoted prices for similar assets or liabilities; (ii) quoted prices in markets that have insufficient volume or infrequent transactions (e.g., less active markets); and (iii) model-driven valuations in which all significant inputs are observable or can be derived principally from, or corroborated with, observable market data for substantially the full term of the asset or liability.
Level 3 - Unobservable inputs to the valuation methodology that are significant to the fair value measurement.
Please refer to Note 2- Significant Accounting Policies of Notes to Consolidated Financial Statements included in our 2025 Form 10-K for a more complete discussion of the various items within the consolidated financial statements measured at fair value and the methods used to determine fair value. Please also refer to Note 17- Commitments and Contingencies and Derivative Financial Instruments for discussion regarding the Company's derivative instruments and Note 14- Discontinued Operations for discussion regarding the Company's former investment in Amentum common shares.
The net carrying amounts of cash and cash equivalents, trade receivables and payables and short-term debt approximate fair value due to the short-term nature of these instruments. See Note 12- Borrowings for a discussion of the fair value of long-term debt.
Page 13
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
4. New Accounting Pronouncements
ASU 2025-12, Accounting Standards Codification ("Codification") Improvements, represents changes to the Codification that clarify, correct errors or make minor improvements to U.S. GAAP. The amendments in this update are effective for annual reporting periods beginning after December 15, 2026, and interim periods within those annual reporting periods, with early adoption permitted. ASU 2025-12 will be effective for the Company in first quarter of fiscal 2028. The Company is evaluating the impact of this guidance on its consolidated financial statements and related disclosures.
ASU 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements, clarifies the applicability of Topic 270, the types of interim reporting, and the form and content of interim financial statements in accordance with U.S. GAAP, as well as includes a disclosure principle that requires entities to disclose events since the end of the last annual reporting period that have a material impact on the entity. The amendments in this update are effective for interim reporting periods within annual reporting periods beginning after December 15, 2027, with early adoption permitted. ASU 2025-11 will be effective for the Company in first quarter of fiscal 2029. The Company is evaluating the impact of this guidance on its consolidated financial statements and related disclosures.
ASU 2025-09, Derivatives and Hedging (Topic 815): Hedge Accounting Improvements, clarifies certain aspects of the guidance on hedge accounting to address several incremental hedge accounting issues arising from the global reference rate reform initiative. The amendments in this update are effective for annual reporting periods beginning after December 15, 2026, and interim periods within those annual reporting periods, with early adoption permitted. ASU 2025-09 will be effective for the Company in first quarter of fiscal 2028. The Company is evaluating the impact of this guidance on its consolidated financial statements and related disclosures.
ASU 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets, provides all entities with a practical expedient option when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. The amendments in this update are effective for annual reporting periods beginning after December 15, 2025, including interim periods within those annual periods, with early adoption permitted. ASU 2025-05 will be effective for the Company in first quarter of fiscal 2027. The Company is evaluating the impact of this guidance on its consolidated financial statements and related disclosures.
ASU 2025-03, Business Combinations (Topic 805) and Consolidation (Topic 810): Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity, clarifies the guidance in determining the accounting acquirer in a business combination effected primarily by exchanging equity interests when the acquiree is a variable interest entity that meets the definition of a business. The standard is effective for fiscal years beginning after December 15, 2026, including interim periods within those fiscal years. Early adoption is permitted, and the standard is to be applied prospectively to acquisitions after the adoption date. ASU 2025-03 will be effective for the Company in the first quarter of fiscal 2028. The Company is evaluating the impact of this guidance on its consolidated financial statements and related disclosures.
ASU 2024-03, Income Statement (Subtopic 220-40): Reporting Comprehensive Income - Disaggregation of Income Statement Expenses, requires disclosure, in the notes to financial statements, of specified information about certain costs and expenses. The amendments in this update also provide guidance on the disaggregation disclosure requirements for certain expense captions presented on the face of an entity’s income statement and provide guidance on the disclosure of selling expenses. The amendments in ASU 2024-03 are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027, with early adoption permitted. The amendments should be applied prospectively; however, retrospective application is also permitted. ASU 2024-03 will be effective for the Company in the fourth quarter of fiscal 2028. The Company is evaluating the impact of this guidance on its consolidated financial statements and related disclosures.
Page 14
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures, provides qualitative and quantitative updates to the Company's effective income tax rate reconciliation and income taxes paid disclosures, among others, in order to enhance the transparency of income tax disclosures, including consistent categories and greater disaggregation of information in the rate reconciliation and disaggregation by jurisdiction of income taxes paid. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendments should be applied prospectively; however, retrospective application is also permitted. ASU 2023-09 will be effective for the Company in the fourth quarter of fiscal 2026. The Company is evaluating the impact of this guidance on its consolidated financial statements and related disclosures.
ASU 2023-06, Disclosure Improvements: Amendments - Codification Amendments in Response to the Disclosure Update and Simplification Initiative of the Securities and Exchange Commission ("SEC"). The Financial Accounting Standards Board issued the standard to introduce changes to U.S. GAAP that originate in either SEC Regulation S-X or S-K, which are rules about the form and content of financial reports filed with the SEC. The provisions of the standard are contingent upon instances where the SEC removes the related disclosure provisions from Regulation S-X and S-K. ASU 2023-06 is effective for fiscal years beginning after December 15, 2024, with early adoption permitted. The amendments should be applied prospectively; however, retrospective application is also permitted. ASU 2023-06 will be effective for the Company in the fourth quarter of fiscal 2026. The Company does not expect that the application of this standard will have a material impact on our consolidated financial statements and related disclosures.
5. Revenue Accounting for Contracts
Disaggregation of Revenues
Our revenues are principally derived from contracts to provide a diverse range of technical, professional, and construction services to a large number of industrial, commercial, and governmental clients. We provide a broad range of engineering, design, and architectural services; construction and construction management services; operations and maintenance services; and technical, digital, process, scientific and systems consulting services. We provide our services through offices and subsidiaries located primarily in North America, Europe, the Middle East, India, Australia, Africa, and Asia. We provide our services under cost-reimbursable (including limited amounts of guaranteed maximum price) and fixed-price contracts. Our contracts are with many different customers in numerous industries. Refer to Note 18- Segment Information for additional information on how we disaggregate our revenues by reportable segment.
The following table further disaggregates our revenue by geographic area for the three and six months ended March 27, 2026 and March 28, 2025 (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| March 27, 2026 | March 28, 2025 | March 27, 2026 | March 28, 2025 | ||||||||||||||||||||
| Revenues: | |||||||||||||||||||||||
| United States | $ | $ | $ | $ | |||||||||||||||||||
| Europe | |||||||||||||||||||||||
| Canada | |||||||||||||||||||||||
| Asia | |||||||||||||||||||||||
| India | |||||||||||||||||||||||
| Australia and New Zealand | |||||||||||||||||||||||
| Middle East and Africa | |||||||||||||||||||||||
| Total | $ | $ | $ | $ | |||||||||||||||||||
Contract Liabilities
Contract liabilities represent amounts billed to clients in excess of revenue recognized to date. Revenue recognized for the three and six months ended March 27, 2026 that was previously included in the contract liability balance on September 26, 2025 was $169.6 million and $618.4 million, respectively. Revenue recognized for the three and six months ended March 28, 2025 that was included in the contract liability balance on September 27, 2024 was $172.2 million and $583.0 million, respectively.
Page 15
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Remaining Performance Obligations
The Company’s remaining performance obligations as of March 27, 2026 represent a measure of the total dollar value of work to be performed on contracts awarded and in progress. The Company had approximately $19.0 billion in remaining performance obligations as of March 27, 2026. The Company expects to recognize approximately 47 % of its remaining performance obligations into revenue within the next twelve months and the remaining 53 % thereafter. The majority of the remaining performance obligations after the first twelve months are expected to be recognized over a four-year period.
Although our remaining performance obligations reflect business volumes that are considered to be firm, normal business activities including scope adjustments, deferrals or cancellations may occur that impact volume or expected timing of their recognition. Remaining performance obligations are adjusted to reflect any known project cancellations, revisions to project scope and cost, foreign currency exchange fluctuations and project deferrals, as appropriate.
6. Earnings Per Share and Certain Related Information
Basic and diluted earnings per share (“EPS”) are computed using the two-class method, which is an earnings allocation method that determines EPS for common shares and participating securities. The undistributed earnings are allocated between common shares and participating securities as if all earnings had been distributed during the period. Participating securities and common shares have equal rights to undistributed earnings. Net earnings used for the purpose of determining basic and diluted EPS is determined by taking net earnings, less earnings available to participating securities and the redeemable noncontrolling interests redemption value adjustment associated with the PA Consulting investment.
In connection with the PA Consulting Transaction, the Company issued 2,043,537 shares of Company Common Stock. See Note 15- PA Consulting Redeemable Noncontrolling Interests for more discussion on the transaction.
Page 16
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
The following table reconciles the numerator and denominator used to compute basic EPS to the numerator and denominator used to compute diluted EPS for the three and six months ended March 27, 2026 and March 28, 2025 (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| March 27, 2026 | March 28, 2025 | March 27, 2026 | March 28, 2025 | ||||||||||||||||||||
| Numerator for Basic and Diluted EPS: | |||||||||||||||||||||||
| Net (Loss) Earnings Attributable to Jacobs from Continuing Operations | $ | ( | $ | $ | $ | ( | |||||||||||||||||
Redeemable Noncontrolling interests redemption value adjustment (See Note 15- PA Consulting Redeemable Noncontrolling Interests) | |||||||||||||||||||||||
| Net (Loss) Earnings from continuing operations allocated to common stock for EPS calculation | $ | ( | $ | $ | $ | ( | |||||||||||||||||
| Net (Loss) from discontinued operations allocated to common stock for EPS calculation | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Net (Loss) Earnings allocated to common stock for EPS calculation | $ | ( | $ | $ | $ | ( | |||||||||||||||||
| Denominator for Basic and Diluted EPS: | |||||||||||||||||||||||
| Shares used for calculating basic EPS attributable to common stock | |||||||||||||||||||||||
| Effect of dilutive securities: | |||||||||||||||||||||||
| Stock compensation plans (1) | |||||||||||||||||||||||
| Shares used for calculating diluted EPS attributable to common stock | |||||||||||||||||||||||
| Net Earnings Per Share: | |||||||||||||||||||||||
| Basic Net (Loss) Earnings from Continuing Operations Per Share | $ | ( | $ | $ | $ | ||||||||||||||||||
| Basic Net (Loss) from Discontinuing Operations Per Share | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Basic (Loss) Earnings Per Share | $ | ( | $ | $ | $ | ( | |||||||||||||||||
| Diluted Net (Loss) Earnings from Continuing Operations Per Share | $ | ( | $ | $ | $ | ||||||||||||||||||
| Diluted Net (Loss) from Discontinuing Operations Per Share | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
| Diluted (Loss) Earnings Per Share | $ | ( | $ | $ | $ | ( | |||||||||||||||||
Note: Per share amounts may not add due to rounding. | |||||||||||||||||||||||
(1) For the three months ended March 27, 2026 and the six months ended March 28, 2025, because net (loss) earnings from continuing operations was a loss, the effect of antidilutive securities of | |||||||||||||||||||||||
Page 17
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Share Repurchases
On January 25, 2023, the Company's Board of Directors authorized a share repurchase program of up to $ On January 30, 2025, the Company's Board of Directors authorized an incremental share repurchase program of up to $ | ||
The following table summarizes repurchase activity for fiscal 2026 under the 2025 Repurchase Authorization through the second fiscal quarter of 2026:
Amount Authorized (2025 Repurchase Authorization) | Average Price Per Share (1) | Total Shares Repurchased and Retired | ||||||||||||||||||
| $ | $ | |||||||||||||||||||
(1)Includes commissions paid and excise tax due under the Inflation Reduction Act of 2022 and calculated at the average price per share.
Our share repurchase program does not obligate the Company to purchase any shares. Share repurchases may be executed through various means including, without limitation, accelerated share repurchases, open market transactions, privately negotiated transactions, purchases pursuant to Rule 10b5-1 plans or otherwise. The authorization for the share repurchase programs may be terminated, increased or decreased by the Company’s Board of Directors in its discretion at any time. The timing, amount and manner of share repurchases may depend upon market conditions and economic circumstances, availability of investment opportunities, the availability and costs of financing, currency fluctuations, the market price of the Company's common stock, other uses of capital and other factors. | ||
Cash Dividends
On April 30, 2026, the Company’s Board of Directors declared a quarterly dividend of $0.36 per share of the Company’s common stock to be paid on June 19, 2026, to shareholders of record on the close of business on May 22, 2026. Future dividend declarations are subject to review and approval by the Company’s Board of Directors. Dividends paid through the second fiscal quarter of 2026 and the preceding fiscal year are as follows:
| Declaration Date | Record Date | Payment Date | Cash Amount (per share) | |||||||||||||||||||||||
| January 29, 2026 | February 20, 2026 | March 20, 2026 | $ | |||||||||||||||||||||||
| November 18, 2025 | December 2, 2025 | December 19, 2025 | $ | |||||||||||||||||||||||
| July 31, 2025 | August 22, 2025 | September 19, 2025 | $ | |||||||||||||||||||||||
| April 30, 2025 | May 23, 2025 | June 20, 2025 | $ | |||||||||||||||||||||||
| January 30, 2025 | February 21, 2025 | March 21, 2025 | $ | |||||||||||||||||||||||
| September 26, 2024 | October 25, 2024 | November 22, 2024 | $ | |||||||||||||||||||||||
Page 18
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
7. Goodwill and Intangibles
The carrying value of goodwill appearing in the accompanying Consolidated Balance Sheets at March 27, 2026 and September 26, 2025 was as follows (in thousands):
| Infrastructure & Advanced Facilities | PA Consulting | Total | |||||||||||||||
| Balance September 26, 2025 | $ | $ | $ | ||||||||||||||
| Foreign currency translation adjustments and other | ( | ( | ( | ||||||||||||||
| Balance March 27, 2026 | $ | $ | $ | ||||||||||||||
The following table provides certain information related to the Company’s acquired intangibles in the accompanying Consolidated Balance Sheets at March 27, 2026 and September 26, 2025 (in thousands):
| Customer Relationships, Contracts and Backlog | Developed Technology | Trade Names | Total | ||||||||||||||||||||||||||||||||||||||||||||
| Balance September 26, 2025 | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
| Amortization | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||
| Foreign currency translation adjustments and other | ( | ( | ( | ( | |||||||||||||||||||||||||||||||||||||||||||
| Balance March 27, 2026 | $ | $ | $ | $ | |||||||||||||||||||||||||||||||||||||||||||
The following table presents estimated amortization expense of intangible assets for the remainder of fiscal 2026 and for the succeeding years.
| Fiscal Year | (in millions) | |||||||
| 2026 | $ | |||||||
| 2027 | ||||||||
| 2028 | ||||||||
| 2029 | ||||||||
| 2030 | ||||||||
| 2031 | ||||||||
| Thereafter | ||||||||
| Total | $ | |||||||
Page 19
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
8. Receivables and Contract Assets
The following table presents the components of receivables and contract assets appearing in the accompanying Consolidated Balance Sheets at March 27, 2026 and September 26, 2025, as well as certain other related information (in thousands):
| March 27, 2026 | September 26, 2025 | ||||||||||
| Components of receivables and contract assets: | |||||||||||
| Amounts billed, net | $ | $ | |||||||||
| Unbilled receivables and other | |||||||||||
| Contract assets | |||||||||||
| Total receivables and contract assets, net | $ | $ | |||||||||
Amounts billed, net consist of amounts invoiced to clients in accordance with the terms of our client contracts and are shown net of an allowance for expected credit losses. We anticipate that substantially all of such billed amounts will be collected over the next twelve months.
Unbilled receivables and other, which represent an unconditional right to payment subject only to the passage of time, are reclassified to amounts billed when they are billed under the terms of the contract. We anticipate that substantially all of such unbilled amounts will be billed and collected over the next twelve months.
Contract assets represent unbilled amounts where the right to payment is subject to more than merely the passage of time and includes performance-based incentives and services that have been provided in advance of agreed contractual milestones. Contract assets are transferred to unbilled receivables when the right to consideration becomes unconditional and are transferred to amounts billed upon invoicing.
9. Accumulated Other Comprehensive Income (Loss)
The following table presents the Company's roll forward of accumulated other comprehensive loss after-tax as of March 27, 2026 (in thousands):
| Change in Net Pension Obligation | Foreign Currency Translation Adjustments | Gain/(Loss) on Cash Flow Hedges (1) | Total | ||||||||||||||||||||
Balance at September 26, 2025 | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||
| Other comprehensive income (loss) | ( | ( | |||||||||||||||||||||
| Reclassifications from accumulated other comprehensive loss | ( | ( | |||||||||||||||||||||
Balance at March 27, 2026 | $ | ( | $ | ( | $ | $ | ( | ||||||||||||||||
(1) Included in the Company’s cumulative net unrealized gains from interest rate and cross currency swaps recorded in accumulated other comprehensive loss as of March 27, 2026 were approximately $
Page 20
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
10. Income Taxes
The Company’s effective tax rates from continuing operations for the three months ended March 27, 2026 and March 28, 2025 were | ||
The most significant items contributing to the difference between the statutory U.S. federal corporate tax rate of 21.0% and the Company's effective tax rate of | ||
The Company’s effective tax rates from continuing operations for the six months ended March 27, 2026 and March 28, 2025 were | ||
The most significant item contributing to the difference between the statutory U.S. federal corporate tax rate of 21.0% and the Company's effective tax rate of | ||
On July 4, 2025, H.R. 1, also referred to as the “One Big Beautiful Bill Act” (“OBBBA”), was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act (“TCJA”), modifications to the international tax framework and pre-TCJA treatment for certain business provisions. ASC 740, Income Taxes, requires the effects of changes in tax rates and laws on deferred tax balances to be recognized in the period in which the legislation is enacted. The OBBBA has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The Company is currently assessing its impact on the consolidated financial statements for the provisions that will be effective in future periods. | ||
| The amount of income taxes the Company pays is subject to ongoing audits by tax jurisdictions around the world. In the normal course of business, the Company is subject to examination by tax authorities throughout the world, including such major jurisdictions as Australia, Canada, India, the United Kingdom and the United States. Our estimate of the potential outcome of any uncertain tax issue is subject to our assessment of the relevant risks, facts, and circumstances existing at the time. The Company believes that it has adequately provided for reasonably foreseeable outcomes related to these matters. However, future results may include favorable or unfavorable adjustments to our estimated tax liabilities in the period the assessments are made or resolved, which may impact our effective tax rate. | ||
11. Joint Ventures, VIEs and Other Investments
For the Company's consolidated variable interest entities ("VIE") joint ventures, the carrying value of assets and liabilities was $119.7 million and $132.9 million, respectively, as of March 27, 2026 and $163.4 million and $144.7 million, respectively, as of September 26, 2025. There are no consolidated VIEs that have debt or credit facilities.
For the Company's proportionate consolidated VIEs, the carrying value of assets and liabilities was $159.3 million and $147.2 million, respectively, as of March 27, 2026, and $143.9 million and $131.9 million, respectively, as of September 26, 2025.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
The carrying values of our investments in equity method joint ventures in the Consolidated Balance Sheets (reported in Other Noncurrent Assets: Miscellaneous) as of March 27, 2026 and September 26, 2025 were $38.4 million and $36.3 million, respectively. Additionally, net income (loss) from equity method joint ventures (reported in Revenue) was $2.6 million and $(0.2 ) million, respectively, during the three months ended March 27, 2026 and March 28, 2025, with $6.8 million and $3.5 million respectively, for the corresponding six month periods. As of March 27, 2026, the Company's equity method investment carrying values do not include material amounts exceeding their share of the respective joint ventures' reported net assets.
Accounts receivable from unconsolidated joint ventures accounted for under the equity method was $15.6 million and $13.6 million as of March 27, 2026 and September 26, 2025, respectively.
12. Borrowings
At March 27, 2026 and September 26, 2025, long-term debt consisted of the following (principal amounts in thousands):
| Interest Rate | Maturity | March 27, 2026 | September 26, 2025 | ||||||||||||||||||||
| JSI Revolving Credit Facility | Benchmark + applicable margin (1) | March 2031 | $ | $ | |||||||||||||||||||
| 2026 Term Loan Facility - Three-year | Benchmark + applicable margin (2) | March 2029 | |||||||||||||||||||||
| 2026 Term Loan Facility - Five-year | Benchmark + applicable margin (3) | March 2031 | |||||||||||||||||||||
| Revolving Credit Facility | Benchmark + applicable margin (4) | February 2028 | |||||||||||||||||||||
| 2025 Term Loan Facility - USD Portion | Benchmark + applicable margin (5) | March 2027 | |||||||||||||||||||||
| 2025 Term Loan Facility - GBP Portion | Benchmark + applicable margin (5) | March 2027 | |||||||||||||||||||||
| Fixed-rate: | |||||||||||||||||||||||
| March 2033 | |||||||||||||||||||||||
| August 2028 | |||||||||||||||||||||||
| March 2036 | |||||||||||||||||||||||
| March 2031 | |||||||||||||||||||||||
| Less: Deferred Financing Fees | ( | ( | |||||||||||||||||||||
| Total Long-term debt, net | $ | $ | |||||||||||||||||||||
(1)The U.S. dollar denominated borrowings under the JSI Revolving Credit Facility (as defined below) bear interest at either a SOFR rate plus a margin of between 0.875 % and 1.625 % or a base rate plus a margin of between 0 % and 0.625 % depending on the Company’s Consolidated Leverage Ratio or Debt Rating (each as defined in the JSI Revolving Credit Facility). The applicable SOFR rate, including applicable margins at March 27, 2026 was approximately 4.90 %.
(2)The borrowings under the 2026 Term Loan Facility - three-year bear interest at either a SOFR rate plus a margin of between 0.750 % and 1.500 % or a base rate plus a margin of between 0 % and 0.500 % depending on the Company’s Consolidated Leverage Ratio or Debt Rating. The applicable SOFR rate including applicable margins for borrowings denominated in U.S. dollars at March 27, 2026 was approximately 4.80 %.
(3)The borrowings under the 2026 Term Loan Facility- five-year bear interest at either a SOFR rate plus a margin of between 0.875 % and 1.625 % or a base rate plus a margin of between 0 % and 0.625 % depending on the Company’s Consolidated Leverage Ratio or Debt Rating. The applicable SOFR rate including applicable margins for borrowings denominated in U.S. dollars at March 27, 2026 was approximately 4.93 %.
(4)The U.S. dollar denominated borrowings under the Revolving Credit Facility bore interest at either a SOFR rate plus a margin of between 0.975 % and 1.725 % or a base rate plus a margin of between 0 % and 0.625 % depending on the Company’s Consolidated Leverage Ratio or Debt Rating (each as defined in the Revolving Credit Facility (defined below)). The interest rate under the Revolving Credit Agreement also incorporated a modest sustainability-linked pricing adjustment, which resulted in a favorable interest rate adjustment to the Company in February 2025. The applicable SOFR rate, including applicable margins, at September 26, 2025 was approximately 5.37 %. Borrowings denominated in British pounds bore interest at an adjusted SONIA rate plus a margin of between 0.908 % and 1.658 %. There were no amounts drawn in British pounds as of September 26, 2025.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
(5)Borrowings under the 2025 Term Loan Facility bore interest at either a SONIA rate or term SOFR rate plus a margin of between 0.975 % and 1.60 % or a base rate plus a margin of between 0 % and 0.50 % depending on the Company’s Consolidated Leverage Ratio or Debt Rating. The applicable SOFR and SONIA rates, including applicable margins, at September 26, 2025 were approximately 5.42 % for borrowings denominated in U.S. dollars and 4.97 % for borrowings denominated in British pounds.
(6)The interest rate payable on the 5.90 % Bonds (as defined below) may be increased by an additional 12.5 basis points on each of September 1, 2028 and September 1, 2030, based on whether or not the Company achieves the key performance indicators set forth in the First Supplemental Indenture (as defined below). Each key performance indicator is independent of the other. Therefore, we may achieve one, both, or neither.
We believe the carrying values of the JSI Revolving Credit Facility and the 2026 Term Loan Facility (as defined below) approximates fair value based on the interest rates and scheduled maturities applicable to the outstanding borrowings.
The following table presents the estimated fair value of each outstanding bond based on Level 2 inputs as of March 27, 2026 (in thousands):
Bond | Estimated Fair Value | |||||||
| $ | ||||||||
| $ | ||||||||
| $ | ||||||||
| $ | ||||||||
Revolving Credit Facility and Term Loans
The Company and certain of its subsidiaries maintained an unsecured revolving credit facility (the “Revolving Credit Facility”) established under a third amended and restated credit agreement, dated February 6, 2023 (the "Revolving Credit Agreement"), among Jacobs and certain of its subsidiaries as borrowers and a syndicate of U.S. and international banks and financial institutions. Amounts up to $2.25 billion in credit extensions under the Revolving Credit Facility could be funded in U.S. dollars, British Sterling, Euros, Canadian dollars, Australian dollars, Swedish Krona, Singapore dollars and other agreed upon alternative currencies. The Revolving Credit Agreement also provided for a letter of credit sub facility of $400.0 million, and provided for a $100.0 million sub facility for swing line loans. Letters of credit were subject to fees based on the Company’s Consolidated Leverage Ratio or Debt Rating, whichever was more favorable to the Company. The Company is a guarantor of the obligations of JEGI and its subsidiaries under the Revolving Credit Agreement. The maturity date of the Revolving Credit Facility was February 6, 2028. However, on March 16, 2026 the Revolving Credit Facility was repaid and the JSI Revolving Credit Facility, a new revolving credit facility, was established (see below).
On March 16, 2026, the Company, JEGI, and certain subsidiaries of the Company, entered into a $1.5 billion long-term unsecured, revolving credit facility (the “JSI Revolving Credit Facility”) with a syndicate of U.S. and international banks and financial institutions. The JSI Revolving Credit Facility permits the Company to borrow in U.S. dollars, British Sterling, Euros, Canadian dollars, Australian dollars, Swedish Krona, Singapore dollars and other agreed upon alternative currencies. The Revolving Credit Agreement also provides for a letter of credit sub facility of $400.0 million, and provides for a $100.0 million sub facility for swing line loans, which are a part of, and not in addition to the overall aggregate borrowing limit. Letters of credit are subject to fees based on the Company’s Consolidated Leverage Ratio or Debt Rating, whichever is more favorable to the Company. The maturity date of the JSI Revolving Credit Facility is March 14, 2031.
The Company and JEGI maintained an unsecured delayed draft term loan facility (the “2021 Term Loan Facility”) established under an amended and restated term loan agreement dated February 6, 2023 (the "Amended and Restated Term Loan Agreement"), by and among the Company and JEGI and a syndicate of banks and financial institutions. On March 13, 2025, the Company exchanged approximately 19.5 million shares of our investment in Amentum Holdings, Inc. for approximately £239.8 million, or $311.5 million, in aggregate principal amount under the 2021 Term Loan Facility in an equity-for-debt transaction (the "Equity-for-Debt Transaction"). The aggregate principal amount of debt was immediately extinguished, and the Company received no other consideration (cash or otherwise) in connection with the exchange. For more information, please refer to Note 14- Discontinued Operations. In connection with the Equity-for-Debt Transaction, $20.5 million in discounts and expenses were recognized as loss on extinguishment of debt.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
On March 27, 2025, the Company, as guarantor, and JEGI, as borrower, entered into a term loan agreement (the “2025 Term Loan Facility”) with Bank of America, N.A., as administrative agent and sole lead arranger, and the lenders party thereto. Under the 2025 Term Loan Facility, JEGI borrowed a $200.0 million term loan and £410.0 million term loan for a term of two-years from the date of initial funding, maturing on March 26, 2027. The proceeds from the 2025 Term Loan Facility were used to repay the remaining outstanding 2021 Term Loan Facility principal equal to $120.0 million and £410.2 million, or $531.6 million, with the remaining proceeds used for general corporate purposes. On March 3, 2026, the Company repaid the outstanding obligations under the 2025 Term Loan Facility using proceeds from the offering and issuance of the 4.75 % Bonds and 5.375 % Bonds.
On March 16, 2026, the Company, as borrower, and JEGI, as guarantor, entered into a unsecured term loan agreement (the “2026 Term Loan Facility”) with a syndicate of financial institutions as lenders. Under the 2026 Term Loan Facility, the Company borrowed a $700.0 million term loan for a term of three-years from the date of initial funding, maturing on March 16, 2029 and $500.0 million term loan for a term of five-years from the date of initial funding, maturing on March 14, 2031. The proceeds from the 2026 Term Loan Facility proceeds were used to fund the cash portion of the PA Consulting Transaction.
We were in compliance with the covenants under the JSI Revolving Credit Facility and 2026 Term Loan Facility at March 27, 2026.
On February 16, 2023, JEGI completed an offering of $500.0 million aggregate principal amount of 5.90 % Bonds due 2033 (the “5.90 % Bonds”). The 5.90 % Bonds are fully and unconditionally guaranteed by the Company (the “5.90 % Bonds Guarantee”). The 5.90 % Bonds and the 5.90 % Bonds Guarantee were offered pursuant to a prospectus supplement, dated February 13, 2023, to the prospectus dated February 6, 2023, that forms a part of the Company's and JEGI’s automatic shelf registration statement on Form S-3ASR previously filed with the SEC, and were issued pursuant to an indenture (the "Indenture"), dated as of February 16, 2023, between JEGI, as issuer, the Company, as guarantor, and U.S. Bank Trust Company, National Association, as trustee (the "Trustee"), as amended and supplemented by the First Supplemental Indenture, dated as of February 16, 2023 (the “First Supplemental Indenture”). Interest on the 5.90 % Bonds is payable semi-annually in arrears on each March 1 and September 1, until maturity. The 5.90 % Bonds bear interest at 5.90 % per annum, subject to adjustments as discussed in note (6) to the table above.
Prior to December 1, 2032 (the “5.90 % Bonds Par Call Date”), JEGI may redeem the 5.90 % Bonds at its option, in whole or in part, at any time and from time to time, at the redemption price calculated by JEGI (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of: (1) (a) the sum of the present values of the remaining scheduled payments of principal and interest on the 5.90 % Bonds being redeemed, assuming that such 5.90 % Bonds matured on the 5.90 % Bonds Par Call Date, discounted to the redemption date on a semiannual basis (assuming a 360-day year of twelve 30-day months), at the Treasury Rate (as defined in the First Supplemental Indenture) plus 35 basis points, less (b) interest accrued to the redemption date, and (2) 100 % of the principal amount of such 5.90 % Bonds to be redeemed, plus, in either case, accrued and unpaid interest on the 5.90 % Bonds, if any, to, but excluding, the redemption date. At any time and from time to time on or after the 5.90 % Bonds Par Call Date, JEGI may redeem the 5.90 % Bonds, at its option, in whole or in part, at a redemption price equal to 100 % of the principal amount of the 5.90 % Bonds to be redeemed, plus accrued and unpaid interest thereon, if any, up to, but excluding, the redemption date.
On August 18, 2023, JEGI completed an offering of $600.0 million aggregate principal amount of 6.35 % Bonds due 2028 (the “6.35 % Bonds”). The 6.35 % Bonds are fully and unconditionally guaranteed by the Company (the “6.35 % Bonds Guarantee”). The 6.35 % Bonds and the 6.35 % Bonds Guarantee were offered pursuant to a prospectus supplement, dated August 15, 2023, to the prospectus dated February 6, 2023, that forms a part of the Company and JEGI’s automatic shelf registration statement on Form S-3ASR previously filed with the SEC, and were issued pursuant to the Indenture, as amended and supplemented by the Second Supplemental Indenture, dated as of August 18, 2023 (the “Second Supplemental Indenture”). Interest on the 6.35 % Bonds is payable semi-annually in arrears on each February 18 and August 18, until maturity. The Notes will bear interest at a rate of 6.35 % per annum and will mature on August 18, 2028. The 6.35 % Bonds bear interest at 6.35 % per annum.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Prior to July 18, 2028 (the “6.35 % Bonds Par Call Date”), JEGI may redeem the 6.35 % Bonds at its option, in whole or in part, at any time and from time to time, at the redemption price calculated by JEGI (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of: (1) (a) the sum of the present values of the remaining scheduled payments of principal and interest on the 6.35 % Bonds being redeemed, assuming that such 6.35 % Bonds matured on the 6.35 % Bonds Par Call Date, discounted to the redemption date on a semiannual basis (assuming a 360-day year of twelve 30-day months), at the Treasury Rate (as defined in the Second Supplemental Indenture) plus 30 basis points, less (b) interest accrued to the redemption date, and (2) 100 % of the principal amount of such 6.35 % Bonds to be redeemed, plus, in either case, accrued and unpaid interest on the 6.35 % Bonds, if any, to, but excluding, the redemption date. At any time and from time to time on or after the 6.35 % Bonds Par Call Date, JEGI may redeem the 6.35 % Bonds, at its option, in whole or in part, at a redemption price equal to 100 % of the principal amount of the 6.35 % Bonds to be redeemed, plus accrued and unpaid interest thereon, if any, to, but excluding, the redemption date.
On March 3, 2026, the Company completed an offering of $800.0 million aggregate principal amount of 4.75 % Bonds due 2031 (the "4.75 % Bonds") and $500.0 million aggregate principal amount of 5.375 % Bonds due 2036 (the "5.375 % Bonds"). The 4.75 % Bonds and 5.375 % Bonds are fully and unconditionally guaranteed by JEGI (the “Guarantees”). The 4.75 % Bonds and 5.375 % Bonds, and the Guarantees were offered pursuant to a prospectus supplement, dated February 24, 2026, to the prospectus dated February 2, 2026, that forms a part of the Company and the JEGI's automatic shelf registration statement on Form S-3ASR previously filed with the SEC, and were issued pursuant to the Indenture, as amended and supplemented by the Third Supplemental Indenture, dated March 3, 2026 (the “Third Supplemental Indenture”). Interest on the 4.75 % Bonds and 5.375 % Bonds is payable semi-annually in areas on March 3 and September 3 of each year, commencing on September 3, 2026, until maturity. The 4.75 % Bonds bear interest at the rate of 4.75 % per annum and will mature on March 3, 2031. The 5.375 % Bonds bear interest at the rate of 5.375 % per annum and will mature on March 3, 2036.
Prior to February 3, 2031 for the 4.75 % Bonds (one month prior to the maturity date of the 4.75 % Bonds) and December 3, 2035 for the 5.375 % Bonds (three months prior to the maturity date of the 5.375 % Bonds) (each such date, a "Par Call Date”), the Company may redeem the 4.75 % Bonds and 5.375 % Bonds at its option, in whole or in part, at any time and from time to time, at the applicable redemption price calculated by the Company (expressed as a percentage of principal amount and rounded to three decimal places) equal to the greater of: (1) (a) the sum of the present values of the remaining scheduled payments of principal and interest on the 4.75 % Bonds and 5.375 % Bonds being redeemed, assuming that such 4.75 % Bonds and 5.375 % Bonds matured on the Par Call Date, discounted to the redemption date on a semiannual basis (assuming a 360-day year of twelve 30-day months), at the Treasury Rate (as defined in the Third Supplemental Indenture) plus 20 basis points for the 4.75 % Bonds and 25 basis points for the 5.375 % Bonds, less (b) interest accrued to the redemption date, and (2) 100 4.75 % Bonds and 5.375 % Bonds to be redeemed, plus, in either case, accrued and unpaid interest on the 4.75 % Bonds and 5.375 % Bonds, if any, to, but excluding, the redemption date. At any time and from time to time on or after the applicable Par Call Date, the Company may redeem the 4.75 % Bonds and 5.375 % Bonds, at its option, in whole or in part, at a redemption price equal to 100 4.75 % Bonds and 5.375 % Bonds to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date.
Other arrangements
The Company holds an interest rate derivative contract to swap a portion of our variable rate debt to fixed rate debt. See Note 17- Commitments and Contingencies and Derivative Financial Instruments for discussion regarding the Company's derivative instruments.
The Company issued $0.3 million in letters of credit under the JSI Revolving Credit Facility, leaving $994.7 million of available borrowing capacity under the JSI Revolving Credit Facility at March 27, 2026. In addition, the Company had issued $253.1 million under various separate, committed and uncommitted letter-of-credit facilities for total issued letters of credit of $253.4 million at March 27, 2026.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
13. Pension and Other Postretirement Benefit Plans
The following table presents the components of net periodic pension benefit expense recognized in earnings during the three and six months ended March 27, 2026 and March 28, 2025 (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| March 27, 2026 | March 28, 2025 | March 27, 2026 | March 28, 2025 | ||||||||||||||||||||
| Component: | |||||||||||||||||||||||
| Service cost | $ | $ | $ | $ | |||||||||||||||||||
| Interest cost | |||||||||||||||||||||||
| Expected return on plan assets | ( | ( | ( | ( | |||||||||||||||||||
| Amortization of previously unrecognized items | |||||||||||||||||||||||
| Settlement | |||||||||||||||||||||||
| Total net periodic pension benefit expense recognized | $ | $ | $ | $ | |||||||||||||||||||
The service cost component of net periodic pension benefit is presented in the same line item as other compensation costs (Direct cost of contracts and Selling, general and administrative expenses) and the other components of net periodic pension expense are presented in Miscellaneous expense on the Consolidated Statements of Earnings.
The following table presents certain information regarding the Company’s cash contributions to our pension plans for fiscal 2026 (in thousands):
Cash contributions made during the first six months of fiscal 2026 | $ | ||||
Cash contributions projected for the remainder of fiscal 2026 | |||||
| Total | $ | ||||
14.Discontinued Operations
Separation of Critical Mission Solutions (“CMS”) and Cyber & Intelligence (“C&I”) Businesses
On September 27, 2024, Jacobs completed the previously announced Reverse Morris Trust transaction pursuant to which (i) Jacobs first transferred its CMS and portions of its DVS business to Amazon Holdco Inc., a Delaware corporation (SpinCo), which has since been renamed Amentum Holdings, Inc., (ii) Jacobs then effectuated a spin-off of SpinCo by distributing 124,084,108 shares of SpinCo Common Stock, by way of a pro rata distribution to its shareholders such that each holder of shares of Jacobs Common Stock was entitled to receive one share of SpinCo Common Stock for each share of Jacobs common stock held as of the record date, September 23, 2024 (the "Distribution"), and (iii) finally, Amentum Parent Holdings LLC merged with and into SpinCo, with SpinCo surviving the merger. Amentum Holdings, Inc., as the surviving entity of the Separation Transaction is now an independent public company with common stock listed on the New York Stock Exchange under the symbol “AMTM” (“Amentum”).
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
In connection and in accordance with the terms of the Separation Transaction and prior to the Distribution and the Merger, Jacobs received a cash payment from SpinCo of approximately $911.0 million, after adjustments based on the estimated levels of cash, debt and working capital in the SpinCo Business as of the transaction date, and recorded estimated additional net working capital receivable amounts reflected in Receivables and Contract Assets in the Company's September 27, 2024 Consolidated Balance Sheet, subject to final settlement between the parties after the closing of the transaction and as set forth in the Agreement and Plan of Merger, dated as of November 20, 2023 (as amended, the “Merger Agreement"). Subsequent to the closing and upon final determination in March 2025, the parties determined that the Company was entitled to $70.0 million in final settlement of the post-closing working capital adjustment, resulting in a $24.0 million reduction from preliminary recorded receivable amounts, which was charged to Retained Earnings in the Company's Consolidated Balance Sheet. The $70.0 million final receivable balance was collected in full on April 10, 2025 and immediately utilized to pay down existing amounts owed on Company’s Revolving Credit Facility upon receipt.
Summarized Financial Information of Discontinued Operations
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| March 27, 2026 | March 28, 2025 | March 27, 2026 | March 28, 2025 | ||||||||||||||||||||
| Revenues | $ | $ | ( | $ | $ | ( | |||||||||||||||||
| Direct cost of contracts | ( | ||||||||||||||||||||||
Gross (loss) profit | ( | ( | |||||||||||||||||||||
Selling, general and administrative expense | ( | ( | ( | ||||||||||||||||||||
Operating (Loss) Profit | ( | ( | ( | ||||||||||||||||||||
Other expense, net (1) | ( | ( | |||||||||||||||||||||
(Loss) Earnings Before Taxes from Discontinued Operations | ( | ( | ( | ( | |||||||||||||||||||
Income Tax Benefit (Expense) | |||||||||||||||||||||||
Net (Loss) Earnings of the Group from Discontinued Operations | ( | ( | ( | ( | |||||||||||||||||||
Net Earnings Attributable to Noncontrolling Interests from Discontinued Operations | |||||||||||||||||||||||
Net (Loss) Earnings Attributable to Jacobs from Discontinued Operations | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
(1)Other expense, net for the three and six months ended March 27, 2026 was unfavorably impacted by $2.6
For the three and six months ended March 27, 2026, discontinued operations used $32.7
No assets and liabilities remained held for spin as of March 27, 2026 and September 26, 2025 balance sheet dates.
Investment in Amentum Stock
As a result of the Separation Transaction on September 27, 2024, Jacobs held approximately 29.2 million of the outstanding shares of Amentum common stock initially recorded on a net book value basis under spin-off accounting rules.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Following the Merger and in accordance with the Escrow Agreement, Jacobs transferred approximately 10.9 million of the 29.2 million of Amentum shares held into escrow to be held and distributed between the parties based on terms and conditions set forth in the Merger Agreement. The entire 29.2 million shares of Amentum, consisting of both the 10.9 million in escrow shares and the remaining 18.3 million shares owned by Jacobs was reflected in the Company’s September 27, 2024 Consolidated Balance Sheet pending final settlement of the escrow shares at a recorded fair value of $749.5 million.
In February 2025, in connection with the determination of SpinCo’s fiscal year 2024 performance against certain agreed upon milestones and ensuing escrow share settlement proceedings (the “Post-Closing Additional Merger Consideration Adjustment”), the parties agreed that Jacobs was entitled to receive at least an additional 1.2 million shares held in escrow, which were then released to Jacobs. Subsequently, on March 13, 2025, Jacobs completed the Equity-for-Debt Transaction (see Note 12- Borrowings for additional information). After giving effect to the above transactions, the Company's remaining investment in Amentum represented the 9.7 million shares remaining in escrow.
Further, on April 7, 2025, the parties agreed to a final determination of the Post-Closing Additional Merger Consideration Adjustment, pursuant to which Jacobs became entitled to receive approximately 7.3 million Amentum shares from the remaining 9.7 million shares held in escrow mentioned above, and former Amentum equity sponsors became entitled to receive the remainder of approximately 2.4 million shares. The finalization of the shares deemed owed to the former Amentum equity sponsors resulted in approximately $21.9 million in charges to Miscellaneous Expense in the Company's Consolidated Statement of Earnings in the second fiscal quarter of 2025. These shares were subsequently released to the respective parties during the third fiscal quarter of 2025.
Finally, on April 30, 2025, the Jacobs Board of Directors declared a dividend in kind to distribute the remaining 7.3 million shares of Amentum's stock to Jacobs’ shareholders of record as of May 16, 2025, which were distributed on a pro rata basis on May 30, 2025, resulting in an impact on retained earnings as shown on the Company's Consolidated Statements of Shareholders' Equity for the year ended September 26, 2025. Following the distribution, the Company no longer owns any shares of Amentum common stock.
The Company reported $109.5 million and $254.7 million in fair value mark-to-market losses and other related charges associated with the former investment in Amentum shares for the three and six months ended March 28, 2025, respectively, which were included in Miscellaneous expense as reported in Other Income (Expense) in the Company’s Consolidated Statement of Earnings.
Transition Services Agreement
Upon closing of the Separation Transaction, the Company entered into a Transition Services Agreement (the "TSA") with Amentum pursuant to which the Company, on an interim basis, will provide various services to Amentum including corporate, information technology, and project services. The initial term of the TSA began immediately following the closing of the transaction on September 27, 2024. As of September 26, 2025, the TSA was substantially exited with certain agreed upon extensions which were completed as of December 26, 2025. Pursuant to the terms of the TSA, the Company received payments for the interim services. From inception of the TSA agreement, the Company recognized costs recorded in SG&A expense incurred to perform the TSA, offset by $10.3 million in TSA related income for such services that is reported in Miscellaneous expense for the three months ended March 28, 2025, with $0.1 million and $21.7 million respectively, for the six month periods ended March 27, 2026 and March 28, 2025.
Sale of Energy, Chemicals and Resources ("ECR") Business
15. PA Consulting Redeemable Noncontrolling Interests
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
In connection with the Company's strategic investment in PA Consulting on March 2, 2021, the Company recorded redeemable noncontrolling interests, including subsequent purchase accounting adjustments, representing the noncontrolling interest holders' equity interests in the form of preferred and common shares of PA Consulting, with substantially all of the value associated with these interests allocable to the preferred shares. Since the March 2, 2021 investment date, PA Consulting has been accounted for as a consolidated subsidiary and as a separate operating segment of the Company.
On January 2, 2026, Jacobs entered into the Implementation Deed with PA Consulting. Pursuant to the Implementation Deed and certain related agreements, and in accordance with the terms and conditions thereof, on March 20, 2026, Jacobs completed the transaction to acquire from shareholders of PA Consulting all of the remaining issued share capital of PA Consulting ("PA Shares") owned by the PA Consulting shareholders (excluding shares already held by Jacobs and its affiliates). The Company acquired the PA Shares for an aggregate initial consideration of approximately £1.21 billion which was paid through a combination of approximately £997.6 million in cash (net of certain PA Consulting shareholder expenses) and 2,043,537 newly issued shares of Jacobs' common stock, par value $1.00 per share (“Company Common Stock”). Also, on March 20, 2028, the Company will pay an additional £75 million in consideration with shares of Company Common Stock, cash or a combination thereof (as determined by the Company in its sole discretion), with accruals associated with this additional consideration reflected in Other deferred liabilities on the Consolidated Balance Sheet as of March 27, 2026. The transactions described in this paragraph, are collectively referred to as the “PA Consulting Transaction”. As a result of the PA Consulting Transaction, the Company no longer carries Redeemable Noncontrolling Interests on the Jacobs Consolidated Financial Statements. See Note 12- Borrowings for discussion on the financing for the transaction.
All of the shares of Company Common Stock issued for the initial consideration in connection with the PA Consulting Transaction (2,043,537 shares of Company Common Stock) are subject to a contractual lockup period that restricts any sale, assignment, pledge, or other transfer of those shares until March 20, 2027. The locked-up shares have the same voting, dividend, and other rights as Jacobs’ other outstanding common shares. The lockup restriction affects only the sale, assignment, pledge or other transfer of those shares and will expire by its terms on March 20, 2027, at which time such transfer restriction will lapse. As of March 27, 2026, 2,043,537 shares remain subject to the lockup.
Also, in connection with the PA Consulting Transaction, approximately $113.5 million of initial consideration was paid on March 20, 2026 in cash for PA Consulting shares held to the PA Consulting employee benefit trust (the "PA Consulting EBT" - a consolidated entity of Jacobs), with these cash amounts reported as restricted cash in Prepaid expenses and other on the Consolidated Balance Sheets as of March 27, 2026. Further, upon the recommendation of the PA Consulting shareholder representatives, this restricted cash is anticipated to be distributed by the trustees of the PA Consulting EBT to PA Consulting employees that were employed by PA Consulting as of the March 20, 2026 transaction completion date, with the majority of this distribution expected to take place in the third quarter of fiscal year 2026 (also see the Restricted Cash section of this footnote below for more information). Based on the terms of the agreements, this amount represents compensation expense incurred related to the transaction with associated charges reflected in Selling, general and administrative expense on the accompanying Consolidated Statements of Earnings and related accruals reported in Accrued liabilities on the Consolidated Balance Sheets as of March 27, 2026. In addition, approximately $10.4 million of the deferred consideration discussed above is also payable to the PA Consulting EBT, which will be distributed to PA Consulting employees on March 20, 2028. Similar to the terms and conditions described above, this amount represents compensation expense incurred as of the transaction date and is also reflected in Selling, general and administrative expense on the accompanying Consolidated Statements of Earnings and in Other deferred liabilities on the Consolidated Balance Sheets as of and for the period ended March 27, 2026.
Other transaction costs associated with the PA Consulting Transaction of $36.0 million is reflected within Retained earnings and presented in the Consolidated Statements of Stockholders' Equity for the six months ended March 27, 2026.
Prior to the PA Consulting Transaction, during the first half of fiscal 2026 and 2025, PA Consulting repurchased certain shares of the redeemable noncontrolling interest holders for $0.4 million and $4.1 million respectively, in cash. The difference between the cash purchase prices and the recorded book values of these repurchased and issued interests was recorded in the Company’s consolidated retained earnings. The Company held approximately 71 % of the outstanding ownership of PA Consulting prior to the PA Consulting Transaction completion date and as of September 26, 2025.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
During the first half of fiscal 2026 and 2025, there were adjustments of $0.11 and $0.05 , respectively, to consolidated earnings per share resulting from adjustments to the redeemable noncontrolling interests to reflect the excess of redemption values over fair values of the B common shares component of the redeemable noncontrolling interests. The redemption value adjustments associated with redeemable noncontrolling interests preference share repurchase and reissuance activities that were recorded had an immaterial impact to earnings per share for the six months ended March 27, 2026 and March 28, 2025. As a result of the PA Consulting Transaction, these shares were redeemed at fair value therefore there was no cumulative impact to EPS. The changes above had no impact on the Company’s overall results of operations, financial position or cash flows. See Note 6- Earnings Per Share and Certain Related Information for more information.
Changes in the redeemable noncontrolling interests during the six months ended March 27, 2026 are as follows (in thousands):
| Balance at September 26, 2025 | $ | ||||||||||||||||||||||
| Accrued Preferred Dividend to Preference Shareholders | |||||||||||||||||||||||
| Attribution of Preferred Dividend to Common Shareholders | ( | ||||||||||||||||||||||
Net loss attributable to redeemable noncontrolling interests to Common Shareholders | ( | ||||||||||||||||||||||
| Redeemable Noncontrolling interests redemption value adjustment | |||||||||||||||||||||||
| Repurchase of redeemable noncontrolling interests | ( | ||||||||||||||||||||||
Cumulative translation adjustments and other | ( | ||||||||||||||||||||||
Redemption of redeemable noncontrolling interests relating to the PA Consulting Transaction | ( | ||||||||||||||||||||||
| Balance at March 27, 2026 | $ | ||||||||||||||||||||||
In addition, certain employees and non-employees of PA Consulting were eligible to receive equity-based incentive grants since the March 2, 2021 original investment date. Under the terms of the applicable agreements, these grants reached vested status on a tranche basis of approximately 40 % through July 2025, and the remaining 60 % vested on March 20, 2026 upon completion of the PA Consulting Transaction. The previously recorded accrued liabilities in connection with the vested grants under these agreements (reported in Other deferred liabilities on our Consolidated Balance Sheets at fair value) were settled with transaction proceeds in connection with the PA Consulting Transaction on March 20, 2026. No remaining unrecognized compensation costs are expected to be incurred in connection with these agreements in the future. As of September 26, 2025, the liabilities for the vested grants associated with these equity-based incentive agreements were reported at fair value in the amount of $103.8 million and reflected in Other deferred liabilities in our Consolidated Balance Sheets. Further, during the six months ended March 27, 2026 and March 28, 2025, the Company has recorded $237.5 million and $13.9 million, respectively, in expenses associated with these agreements, which were reflected in Selling, general and administrative expenses in the Consolidated Statements of Earnings.
Restricted Cash
The Company's Consolidated Balance Sheets include restricted cash amounts of $116.5 million and $1.4 million at March 27, 2026 and September 26, 2025, respectively, in PA Consulting subsidiaries that is restricted from general use and is reflected in Prepaid expenses and other, with the increase due primarily to the PA Consulting Transaction as described above.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
16. Restructuring and Other Charges
During fiscal 2023, the Company implemented restructuring and separation initiatives relating to the Separation Transaction (see Note 14- Discontinued Operations for additional information) which continued through fiscal years 2024 and 2025; Jacobs has substantially completed the restructuring program for the Separation Transaction at the end of calendar year 2025. Restructuring initiatives were also implemented during fiscal 2023 relating to our PA Consulting business, which are substantially completed. During fiscal 2026, the Company implemented integration initiatives relating to the PA Consulting Transaction (see Note 15- PA Consulting Redeemable Noncontrolling Interests for additional information). While restructuring activities for these programs are comprised mainly of employee termination costs, the separation and integration activities are primarily related to the engagement of outside services, dedicated internal personnel and other related costs dedicated to those transactions.
Collectively, the above-mentioned restructuring activities are referred to as “Restructuring and other charges.”
The following table summarizes the impacts of the Restructuring and other charges by operating segment for the three and six months ended March 27, 2026 and March 28, 2025 (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| March 27, 2026 | March 28, 2025 | March 27, 2026 | March 28, 2025 | ||||||||||||||||||||
Infrastructure & Advanced Facilities | $ | $ | $ | $ | |||||||||||||||||||
| PA Consulting | |||||||||||||||||||||||
Total (1) | $ | $ | $ | $ | |||||||||||||||||||
(1)The three and six months ended March 27, 2026 and March 28, 2025 included approximately $7.6 million and $9.9 million, respectively, and $10.2 million and $25.1 million, respectively, in restructuring and other charges relating to the Separation Transaction (primarily employee separation costs and professional services). The three and six months ended March 27, 2026 included approximately $6.5 million and $8.3 million in restructuring and other charges relating to the PA Consulting Transaction (primarily professional services and dedicated internal personnel), which were included in Operating (loss) profit in the Company's Consolidated Statement of Earnings (mainly in SG&A).
The activity in the Company’s accruals for Restructuring and other charges for the six months ended March 27, 2026 is as follows (in thousands):
Balance at September 26, 2025 | $ | ||||
Net Charges | |||||
| Payments and other | ( | ||||
| Balance at March 27, 2026 | $ | ||||
The following table summarizes the Restructuring and other charges by major type of costs for the three and six months ended March 27, 2026 and March 28, 2025 (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| March 27, 2026 | March 28, 2025 | March 27, 2026 | March 28, 2025 | ||||||||||||||||||||
| Voluntary and Involuntary Termination | $ | $ | $ | $ | |||||||||||||||||||
Outside Services (1) | |||||||||||||||||||||||
Other (2) | |||||||||||||||||||||||
Total | $ | $ | $ | $ | |||||||||||||||||||
(1) Amounts in the three and six months ended March 27, 2026 are mainly comprised of $2.2 million and $2.5 million, respectively, relating to the PA Consulting Transaction. Amounts in the three and six months ended March 28, 2025 are comprised of professional services relating to the Separation Transaction.
(2) Amounts in the three and six months ended March 27, 2026 are comprised mainly of charges relating to the PA Consulting Transaction. Amounts in the three and six months ended March 28, 2025 are comprised of charges relating to the Separation Transaction.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
Cumulative amounts incurred to date for restructuring and other programs that were active as of March 27, 2026 by each major type of cost are as follows (in thousands):
| Voluntary and Involuntary Termination | $ | ||||
| Outside Services | |||||
Other (1) | |||||
| Total | $ | ||||
(1)Cumulative amount includes a $35.2 million realized gain on interest rate swaps settled during the fourth quarter of fiscal 2024.
17. Commitments and Contingencies and Derivative Financial Instruments
Derivative Financial Instruments
The Company is exposed to interest rate risk under its variable rate borrowings and additionally, due to the nature of the Company's international operations, we are at times exposed to foreign currency risk. As such, we sometimes enter into foreign exchange hedging contracts and interest rate hedging contracts in order to limit our exposure to fluctuating foreign currencies and interest rates.
During fiscal 2022, the Company entered into two treasury lock agreements with a total notional value of $500.0 million to manage its interest rate exposure to the anticipated issuance of fixed rate debt before December 2023. On February 13, 2023, the Company settled these treasury lock agreements and issued the 5.90 % Bonds in the aggregate principal amount of $500.0 million, which resulted in the receipt of cash and a pre-tax gain of $37.4 million, which is being amortized to interest expense and recognized over the term of the 5.90 % Bonds. See Note 12- Borrowings for further discussion relating to the terms of the 5.90 % Bonds. The unrealized net gain on these instruments was $19.5 million and $20.9 million, net of tax, and is included in Accumulated other comprehensive loss as of March 27, 2026 and September 26, 2025, respectively.
In fiscal 2020 we entered into interest rate swap agreements to manage the interest rate exposure on our variable rate loans. By entering into the swap agreements, the Company converted the variable rate based liabilities into fixed rate liabilities for a period of five to ten years . During the fiscal 2023 transition from LIBOR to SOFR, the terms of the swaps were amended accordingly and remained designated as cash-flow hedges in accordance with ASC 815, Derivatives and Hedging. As of March 27, 2026 and September 26, 2025, the Company has one ten-year 200.0
The fair value of the interest rate swap at March 27, 2026 and September 26, 2025 was $20.0 million and $20.5 million, respectively, included within miscellaneous other assets on the Consolidated Balance Sheet. The unrealized net gain on the interest rate swap as of March 27, 2026 and September 26, 2025 was $15.2 million and $15.6 million, respectively, net of tax, and was included in Accumulated other comprehensive loss.
Additionally, the Company held foreign exchange forward contracts in currencies that support our operations, including British Pound, Australian Dollar and other currencies, with notional values of $1.89 billion at March 27, 2026 and $491.9 million at September 26, 2025. The length of these contracts currently ranges from one to three months . The fair value of the foreign exchange contracts at March 27, 2026 was $2.8 million, of which $4.8 million is included within current assets and $(2.0 ) million is included within current liabilities on the Consolidated Balance Sheet as of March 27, 2026. The fair value of the contracts as of September 26, 2025 was $(0.3 ) million, of which $(2.3 ) million is included within current liabilities and $2.0 million is included within current assets on the Consolidated Balance Sheet as of September 26, 2025. Associated income statement impacts are included in Miscellaneous expense in the Consolidated Statements of Earnings for both periods.
In addition, on January 5, 2026, in connection with the PA Consulting Transaction, the Company entered into a foreign exchange forward contract with a notional value of $1.31 billion to manage its exposure to fluctuations in foreign currency exchange rates arising from its obligation to deliver the cash portion of the initial consideration payable in such transaction. On March 12, 2026 the company entered into an additional hedge with a notional value of $60.1 million to offset the original hedged amount. These were subsequently settled on March 18, 2026 and a combined loss of $(20.5
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
The fair value measurements of these derivatives are being made using Level 2 inputs under ASC 820, Fair Value Measurement, as the measurements are based on observable inputs other than quoted prices in active markets. We are exposed to risk from credit-related losses resulting from nonperformance by counterparties to our financial instruments. We perform credit evaluations of our counterparties under forward exchange and interest rate contracts and expect all counterparties to meet their obligations. We have not experienced credit losses from our counterparties.
Leases
The Company’s right-of use assets and lease liabilities presented on the Consolidated Balance Sheets relate to real estate, project assets used in connection with long-term construction contracts, IT assets and vehicles. The Company’s lease obligations are primarily for the use of office space and are primarily operating leases. The respective components of lease expense are reflected in Selling, general and administrative expenses on the Consolidated Statements of Earnings for all periods presented.
Contractual Guarantees, Legal Proceedings, Claims, Investigations and Insurance
In the normal course of business, we make contractual commitments (some of which are supported by separate guarantees) and on occasion we are a party in a litigation or arbitration proceeding, such as the Consolidated JV Matter (see Note 18- Segment Information). The litigation or arbitration in which we are involved includes personal injury claims, professional liability claims and breach of contract claims. Where we provide a separate guarantee, it is strictly in support of the underlying contractual commitment. Guarantees take various forms including surety bonds required by law, or standby letters of credit ("LOC" and also referred to as “bank guarantees”) or corporate guarantees given to induce a party to enter into a contract with a subsidiary. Standby LOCs are also used as security for advance payments or in various other transactions. The guarantees have various expiration dates ranging from an arbitrary date to completion of our work (e.g., engineering only) to completion of the overall project. We record in the Consolidated Balance Sheets amounts representing our estimated liability relating to such guarantees, litigation and insurance claims. Guarantees are accounted for in accordance with ASC 460-10, Guarantees, at fair value at the inception of the guarantee.
At March 27, 2026 and September 26, 2025, the Company had issued and outstanding approximately $253.4 million and $217.0 million, respectively, in LOCs and $3.0 billion and $2.8 billion, respectively, in surety bonds. Of the outstanding LOC amount, $0.3 million has been issued under the JSI Revolving Credit Facility and $253.1 million are issued under separate, committed and uncommitted letter-of-credit facilities.
We maintain insurance coverage for most insurable aspects of our business and operations. Our insurance programs have varying coverage limits depending upon the type of insurance and include certain conditions and exclusions which insurance companies may raise in response to any claim that is asserted by or against the Company. We have also elected to retain a portion of losses and liabilities that occur through using various deductibles, limits, and retentions under our insurance programs. As a result, we may be subject to a future liability for which we are only partially insured or completely uninsured. We intend to mitigate any such future liability by continuing to exercise prudent business judgment in negotiating the terms and conditions of the contracts which the Company enters with its clients. Our insurers are also subject to business risk and, as a result, one or more of them may be unable to fulfill their insurance obligations due to insolvency or otherwise.
Additionally, as a contractor providing services to the U.S. federal government, we are subject to many types of audits, investigations, and claims by, or on behalf of, the government including with respect to contract performance, pricing, cost allocations, procurement practices, labor practices, and socioeconomic obligations. Furthermore, our income, franchise, and similar tax returns and filings are also subject to audit and investigation by the Internal Revenue Service, most states within the United States, as well as by various government agencies representing jurisdictions outside the United States.
Our Consolidated Balance Sheets include amounts representing our probable estimated liability relating to such claims, guarantees, litigation, audits, and investigations. We perform an analysis to determine the level of reserves to establish for insurance-related claims that are known and have been asserted against us, as well as for insurance-related claims that are believed to have been incurred based on actuarial analysis but have not yet been reported to our claims administrators as of the respective balance sheet dates. We include any adjustments to such insurance reserves in our consolidated results of operations. Insurance recoveries are recorded as assets if recovery is probable and estimated liabilities are not reduced by expected insurance recoveries.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
The Company believes, after consultation with counsel, that such guarantees, litigation, U.S. government contract-related audits, investigations and claims, and income tax audits and investigations should not have a material adverse effect on our consolidated financial statements, beyond amounts currently accrued.
On January 2, 2026, Jacobs entered into the Implementation Deed with PA Consulting, pursuant to which (and certain related agreements) Jacobs UK Holdings Limited acquired from shareholders of PA Consulting, other than Jacobs and its affiliates, all of the remaining issued share capital of PA Consulting owned by such shareholders in the PA Consulting Transaction. The transaction was completed on March 20, 2026. Jacobs agreed to unconditionally and irrevocably guarantee, for the period between signing of and closing of the transaction, to the other parties the performance and observance by Jacobs UK Holdings Limited of all its obligations, commitments, undertakings and warranties under the Implementation Deed. For further information, refer to Note 15- PA Consulting Redeemable Noncontrolling Interests.
18. Segment Information
The Company's two
The Company’s Chief Executive Officer is the Chief Operating Decision Maker (“CODM”) and evaluates the performance of and makes appropriate resource allocations to each of the segments. For purposes of the Company’s goodwill impairment testing, it has been determined that the Company’s operating segments are also its reporting units based on management’s conclusion that the components comprising each of its operating segments share similar economic characteristics and meet the aggregation criteria for reporting units in accordance with ASC 350, Intangibles-Goodwill and Other.
Financial information for each segment is reviewed by the CODM to assess performance and make decisions regarding the allocation of resources. The CODM evaluates the operating performance of our operating segments using segment operating profit. The Company incurs certain SG&A that relate to its business as a whole which are not allocated to the segments. The CODM does not review segment assets as a measure of segment performance.
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JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
The following tables present total revenues, direct cost of contracts, selling, general and administrative expenses and segment operating profit from continuing operations for each reportable segment (in thousands) and includes a reconciliation of segment operating profit to total U.S. GAAP operating profit by including certain corporate-level expenses, Restructuring and other charges (as defined in Note 16- Restructuring and Other Charges) and transaction and integration costs (in thousands) for the three and six months ended:
| For the three months ended | For the six months ended | ||||||||||||||||||||||||||||||||||
| March 27, 2026 | March 27, 2026 | ||||||||||||||||||||||||||||||||||
| Infrastructure & Advanced Facilities | PA Consulting | Total | Infrastructure & Advanced Facilities | PA Consulting | Total | ||||||||||||||||||||||||||||||
Revenues from External Customers (1) | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Direct cost of contracts (2) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Selling, general and administrative expenses (2) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Segment Operating Profit (1) | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Restructuring, Transaction and Other Charges (3) | ( | ( | |||||||||||||||||||||||||||||||||
| Amortization of Intangible Assets | ( | ( | |||||||||||||||||||||||||||||||||
| Total U.S. GAAP Operating Profit | $ | ( | $ | ||||||||||||||||||||||||||||||||
Total Other (Expense) Income, net (4) | ( | ( | |||||||||||||||||||||||||||||||||
| Earnings from Continuing Operations Before Taxes | $ | ( | $ | ||||||||||||||||||||||||||||||||
| (1) | The three and six months ended March 27, 2026 I&AF revenue and operating profit in comparison to the corresponding periods for fiscal 2025 reflected lower charges in connection with the Consolidated JV Matter (as defined below). | ||||
| (2) | Direct cost of contracts and SG&A are considered to be significant segment expense categories as amounts align with, or are easily computable from, the segment-level information regularly provided to the CODM. | ||||
| (3) | The three and six months ended March 27, 2026 included $ | ||||
| (4) | The three and six months ended March 27, 2026 included a $ | ||||
Page 35
JACOBS SOLUTIONS INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
| For the Three Months Ended | For the six months ended | ||||||||||||||||||||||||||||||||||
| March 28, 2025 | March 28, 2025 | ||||||||||||||||||||||||||||||||||
| Infrastructure & Advanced Facilities | PA Consulting | Total | Infrastructure & Advanced Facilities | PA Consulting | Total | ||||||||||||||||||||||||||||||
Revenues from External Customers (1) | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Direct cost of contracts (2) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Selling, general and administrative expenses (2) | ( | ( | ( | ( | ( | ( | |||||||||||||||||||||||||||||
Segment Operating Profit (1) | $ | $ | $ | $ | $ | $ | |||||||||||||||||||||||||||||
Restructuring, Transaction and Other Charges (3) | ( | ( | |||||||||||||||||||||||||||||||||
| Amortization of Intangible Assets | ( | ( | |||||||||||||||||||||||||||||||||
| Total U.S. GAAP Operating Profit | $ | $ | |||||||||||||||||||||||||||||||||
Total Other (Expense) Income, net (4) | ( | ( | |||||||||||||||||||||||||||||||||
| Earnings from Continuing Operations Before Taxes | $ | $ | |||||||||||||||||||||||||||||||||
| (1) | The three and six months ended March 28, 2025 I&AF revenue and operating profit were impacted by a reserve in connection with an unfavorable interim ruling against a consolidated joint venture in which the Company holds a | ||||
| (2) | Direct cost of contracts and SG&A are considered to be significant segment expense categories as amounts align with, or are easily computable from, the segment-level information regularly provided to the CODM. | ||||
| (3) | The three and six months ended March 28, 2025 included $ | ||||
| (4) | The three and six months ended March 28, 2025 included $ | ||||
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
General
The purpose of this Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is to provide a narrative analysis explaining the reasons for material changes in the Company’s (i) financial condition from the most recent fiscal year-end to March 27, 2026 and (ii) results of operations during the current fiscal period(s) as compared to the corresponding period(s) of the preceding fiscal year. In order to better understand such changes, readers of this MD&A should also read:
•The discussion of the critical and significant accounting policies used by the Company in preparing its consolidated financial statements. The most current discussion of our critical accounting policies appears in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations of our 2025 Form 10-K, and the most current discussion of our significant accounting policies appears in Note 2- Significant Accounting Polices in Notes to Consolidated Financial Statements of our 2025 Form 10-K;
•The Company’s fiscal 2025 audited consolidated financial statements and notes thereto included in our 2025 Form 10-K; and
•Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our 2025 Form 10-K.
In addition to historical information, this MD&A and other parts of this Quarterly Report on Form 10-Q contain forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that do not directly relate to any historical or current fact. When used herein, words such as “expects,” “anticipates,” “believes,” “seeks,” “estimates,” “plans,” “intends,” “future,” “will,” “would,” “could,” “can,” “may,” "target," "goal" and similar words are intended to identify forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements we make concerning the financial condition and results of operations and our expectations as to our future growth, prospects, financial outlook and business strategy and any assumptions underlying any of the foregoing. Although such statements are based on management’s current estimates and expectations, and/or currently available competitive, financial, and economic data, forward-looking statements are inherently uncertain, and you should not place undue reliance on such statements as actual results may differ materially. We caution the reader that there are a variety of risks, uncertainties and other factors that could cause actual results to differ materially from what is contained, projected or implied by our forward-looking statements. Such factors include but are not limited to:
•general economic conditions, including inflation and the actions taken by monetary authorities in response to inflation, changes in interest rates and foreign currency exchange rates, changes in capital markets and stock market volatility, instability in the banking industry, labor shortages, or the impact of a possible recession or economic downturn or changes to monetary or fiscal policies or priorities in the U.S. and the countries where we do business on our results, prospects and opportunities;
•competition from existing and future competitors in our target markets, as well as the possible reduction in demand for certain of our product solutions and services, including delays in the timing of the award of projects or reduction in funding, or the abandonment of ongoing or anticipated projects due to the financial condition of our clients and suppliers or due to governmental budget constraints or changes to governmental budgetary priorities, or the inability of our clients to meet their payment obligations in a timely manner or at all;
•our ability to fully execute on our corporate strategy, including the impact of acquisitions (including the PA Consulting Transaction (as hereinafter defined), strategic alliances, divestitures, and other strategic events resulting from evolving business strategies, including on our ability to maintain our culture and retain key personnel, customers or suppliers, or our ability to achieve the cost-savings and synergies contemplated by our recent acquisitions within the expected time frames or to achieve them fully and to successfully integrate acquired businesses while retaining key personnel, and our ability to invest in the tools needed to implement our strategy;
•financial market risks that may affect us, including by affecting our access to capital, the cost of such capital and/or our funding obligations under defined benefit pension and post-retirement plans;
Page 37
•legislative changes, including potential changes to the amounts provided for under the Infrastructure Investment and Jobs Act, as well as other legislation and executive orders, including any directive to federal agencies to reduce federal spending or the size of the federal workforce, and changes in U.S. or foreign tax laws, including the OBBBA, statutes, rules, regulations or ordinances, including the impact of, and changes to, tariffs and retaliatory tariffs or trade policies that may adversely impact our future financial position or results of operations;
•increased geopolitical uncertainty and risks, including policy risks and potential civil unrest, relating to the outcome of elections across our key markets and elevated geopolitical tension and conflicts, including the Russia-Ukraine conflict and on-going, escalated and/or future tensions and conflicts in the Middle East, among others; and
•the impact of any pandemic, and any resulting economic downturn on our results, prospects and opportunities, measures or restrictions imposed by governments and health officials in response to the pandemic, as well as the inability of governments in certain of the countries in which we operate to effectively mitigate the financial or other impacts of any future pandemics or infectious disease outbreaks on their economies and workforces and our operations therein.
The foregoing factors and potential future developments are inherently uncertain, unpredictable and, in many cases, beyond our control. For a description of these and additional factors that may occur that could cause actual results to differ from our forward-looking statements, see the Company’s filings with the U.S. Securities and Exchange Commission, including in particular the discussions contained in our fiscal 2025 Form 10-K under Item 1 - Business, Item 1A - Risk Factors, Item 3 - Legal Proceedings, and Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations; and in this Quarterly Report on Form 10-Q under Part I, Item 2 - Management's Discussion and Analysis of Financial Condition and Results of Operations, and Part II, Item 1 - Legal Proceedings and Item 1A - Risk Factors. We undertake no obligation to release publicly any revisions or updates to any forward-looking statements. We encourage you to read carefully the risk factors, as well as the financial and business disclosures contained in this Quarterly Report on Form 10-Q and in other documents we file from time to time with the United States Securities and Exchange Commission (the "SEC").
Business Overview
At Jacobs, our values and our brand promise — Challenging today. Reinventing tomorrow — drive us to deliver innovative solutions and sustainable outcomes for the world’s most complex challenges.
With a global team of approximately 47,000, we provide end-to-end capabilities across advanced manufacturing, cities & places, energy, environmental, life sciences, transportation and water. Our services span advisory and consulting, feasibility and planning, through to design, program delivery and lifecycle management — helping to create a more connected and sustainable world.
From addressing water scarcity and aging infrastructure to access to life-saving therapies and cyber resilience, we combine creativity, agility and deep domain expertise to deliver outcomes that matter. Our integrated approach enables clients to meet urgent needs today while preparing for the opportunities of tomorrow.
Over the past eight years, Jacobs has transformed into a science-based consulting and advisory leader, focused on delivering digitally enabled, resilient solutions to complex sustainability, critical infrastructure and advanced manufacturing challenges. Strategic acquisitions, including a 65% stake in PA Consulting Group Limited ("PA Consulting") in fiscal 2021, along with the digital and data business solutions acquired with the BlackLynx and StreetLight acquisitions — have strengthened our capabilities in high-value technology-enabled solutions.
In February 2025, we launched Challenge Accepted, our multi-year growth strategy designed to sharpen our focus and accelerate our performance. Aligned with our long-term financial framework, this strategy positions us to drive profitable growth and deliver scalable, full lifecycle solutions across water and environmental, life sciences and advanced manufacturing, and critical infrastructure.
As global challenges like urbanization, infrastructure modernization, digital evolution and environmental resilience intensify, our integrated delivery model unites the full breadth of our capabilities — from strategy through execution – across our end markets. This synergy enables us to deliver rapid, large-scale outcomes that anticipate evolving client needs and advance a more resilient, sustainable future where technology elevates human ingenuity and unlocks new possibilities for collaboration and problem-solving.
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We harness our data and digital capabilities, products and tools to help clients operate more efficiently, safely and intelligently. Through the expertise of our people and ongoing investment in artificial intelligence (AI) and next-generation digital solutions, we empower our clients' decision-making across the entire asset lifecycle — from capital planning and operations to cybersecurity and operational technology. Our capabilities in data analytics, digital architecture, advisory and transformation, software development and cybersecurity enable clients to unlock the full value of their data and digital infrastructure to improve performance, resilience and sustainability.
In March 2026, we completed the acquisition of the remaining stake in PA Consulting. Full ownership of PA Consulting strengthens our position as a comprehensive partner delivering integrated advisory and technology-enabled solutions at global scale. By more closely aligning our strategy, digital innovation and major program delivery capabilities, we are better positioned to support clients across the full project lifecycle — from early-stage strategy to implementation — enabling them to address complex challenges with greater speed, capital efficiency and confidence.
Operating Segments
The services we provide to our end markets fall into the following two operating segments: 1) Infrastructure & Advanced Facilities and 2) PA Consulting. For additional information regarding our segments, including information about our financial results by segment and financial results by geography, see Note 18- Segment Information and Note 5- Revenue Accounting for Contracts of Notes to Consolidated Financial Statements.
Infrastructure & Advanced Facilities (I&AF)
Jacobs' Infrastructure & Advanced Facilities line of business provides end-to-end solutions for our clients’ most complex challenges related to energy security, environmental resilience, safe and reliable transportation, buildings and infrastructure, integrated water management and biopharmaceutical manufacturing. In doing so, we combine deep experience in Water & Environmental, Life Sciences & Advanced Manufacturing and Critical Infrastructure. Our core skills revolve around consulting, planning, architecture, design, engineering, infrastructure delivery services including project, program and construction management and long-term operation of facilities. Solutions are delivered as standalone professional service engagements, comprehensive program management partnerships, and selective progressive design-build and construction management at-risk delivery services. Increasingly, we use data science and technology-enabled expertise to deliver positive and enduring outcomes for our clients and communities.
We serve national, state and local government clients across multiple regions — including the U.S., U.K., Europe, the Middle East and Asia Pacific — and multinational and local private sector organizations globally.
PA Consulting
PA Consulting, a wholly owned subsidiary, is a global innovation and transformation consultancy that helps accelerate new growth ideas from concept, through design and development, to commercial success, while supporting organizations in strengthening leadership, culture, systems and processes to make innovation a reality. PA Consulting's global team of strategists, innovators, designers, consultants, digital experts, scientists, engineers and technologists serves clients across seven sectors: consumer and manufacturing, defense and security, energy and utilities, financial services, government, health and life sciences, and transport.
PA Consulting serves a diverse mix of private and public sector clients. Private sector clients include global household names like Diageo, Microsoft, Pret A Manger and Unilever, and start-ups like NTx, which is accelerating access to life-changing therapies. Work for our clients includes applying data and analytics to improve airport operations at Heathrow Airport, supporting the energy transition with Invenergy and energyRe, creating new digital platforms for the American College of Emergency Physicians, pioneering medtech with Hubly Surgical, accelerating clinical trials with AI for a global life sciences consortium, and enhancing resiliency in banking with Bankomat. Public sector clients include the U.K.'s Ministry of Defence, National Highways, The Norwegian Labour and Welfare Administration, The Danish Tax Agency and The Swedish Environmental Protection Agency.
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Clients often rely on multiple providers across advisory, digital innovation and program delivery. We bring these capabilities together by integrating PA Consulting's strengths in strategic advisory, innovation and transformation with our experience delivering advanced manufacturing and highly technical infrastructure programs. This approach enables us to support clients across the full project lifecycle—from early-stage strategy through implementation—delivering practical, scalable solutions to address complex challenges.
In the U.S., we’re supporting the digital transformation of Dallas Fort Worth International Airport and contributing to the Baltimore & Potomac Tunnel Replacement Program — one of the nation's largest transportation infrastructure investments. We’re building an AI blueprint for Hertfordshire County Council, one of England’s largest councils. Through the U.K.’s largest government management consultancy framework, we're providing public sector organizations with streamlined access to advisory services. We're also delivering technical project management for the U.K. Department for Energy Security & Net Zero’s Carbon Capture, Usage and Storage program, a cornerstone of the U.K.’s net-zero ambitions.
Separation of Critical Mission Solutions (CMS) and Cyber & Intelligence (C&I)
On September 27, 2024, Jacobs Solutions Inc. ("Jacobs") completed the previously announced Reverse Morris Trust transaction pursuant to which (i) Jacobs first transferred its Critical Mission Solutions business (“CMS”) and portions of the Divergent Solutions (“DVS”) business (referred to herein as the Cyber & Intelligence business (“C&I”) and together with CMS referred to as the “SpinCo Business”), to Amazon Holdco Inc., a Delaware corporation, which has been renamed Amentum Holdings, Inc. (“SpinCo”) (the “Separation”), (ii) Jacobs then effectuated a spin-off of SpinCo by distributing 124,084,108 shares of SpinCo common stock, par value $0.01 per share (the “SpinCo Common Stock”), by way of a pro rata distribution to its shareholders such that each holder of shares of Jacobs common stock, par value $1.00 per share (the “Jacobs Common Stock”) was entitled to receive one share of SpinCo Common Stock for each share of Jacobs common stock held as of the record date, September 23, 2024 (the “Distribution”), and (iii) finally, Amentum Parent Holdings LLC merged with and into SpinCo, with SpinCo surviving the merger (the “Merger” and together with the Separation and the Distribution, the “Separation Transaction”). The surviving entity of the Separation Transaction is now an independent public company with common stock listed on the New York Stock Exchange under the symbol “AMTM” (“Amentum”).
As a result of the Separation Transaction, substantially all SpinCo Business-related assets and liabilities have been separated and distributed (the "Disposal Group"). The Company determined that the Disposal Group should be reported as discontinued operations in accordance with ASC 205-20, Discontinued Operations because their disposal represents a strategic shift that had a major effect on operations and financial results. As such, the financial results of the SpinCo Business are reflected in our Consolidated Statements of Earnings as discontinued operations for all periods presented.
For further information regarding separation activities that took place subsequent to the Separation Transaction closing, see Note 14- Discontinued Operations.
Prior to the Separation Transaction, Jacobs’ Critical Mission Solutions business provided a full spectrum of solutions for clients to address evolving challenges like digital transformation and modernization, national security and defense, space exploration, digital asset management, the clean energy transition, and nuclear decommissioning and cleanup. Clients included government agencies, as well as private sector clients mainly in the aerospace, automotive, motorsports, energy and telecom sectors. Prior to the Separation Transaction, the DVS business unit served as the core foundation for developing and delivering innovative, next-generation cloud, cyber, data and digital technologies. DVS clients included government agencies and commercial clients in the U.S. and international markets. Certain portions of the DVS business related to advising on digital strategy and transformation and developing digital solutions that facilitate capital, operational and cybersecurity decisions for our clients across our segments and their end markets were retained and are now part of I&AF.
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Results of Operations for the three and six months ended March 27, 2026 and March 28, 2025
(in thousands, except per share information)
| For the Three Months Ended | For the Six Months Ended | ||||||||||||||||||||||
| March 27, 2026 | March 28, 2025 | March 27, 2026 | March 28, 2025 | ||||||||||||||||||||
| Revenues | $ | 3,694,881 | $ | 2,910,415 | $ | 6,988,162 | $ | 5,843,371 | |||||||||||||||
| Direct cost of contracts | (2,899,988) | (2,172,070) | (5,428,019) | (4,383,759) | |||||||||||||||||||
| Gross profit | 794,893 | 738,345 | 1,560,143 | 1,459,612 | |||||||||||||||||||
| Selling, general and administrative expenses | (876,069) | (529,697) | (1,408,758) | (1,042,546) | |||||||||||||||||||
| Operating (loss) profit | (81,176) | 208,648 | 151,385 | 417,066 | |||||||||||||||||||
| Other Income (Expense): | |||||||||||||||||||||||
Interest income | 9,301 | 9,525 | 16,930 | 19,181 | |||||||||||||||||||
Interest expense | (41,075) | (38,580) | (75,329) | (73,399) | |||||||||||||||||||
Loss on extinguishment of debt | — | (20,510) | — | (20,510) | |||||||||||||||||||
| Miscellaneous expense | (17,656) | (103,260) | (17,370) | (233,367) | |||||||||||||||||||
| Total other expense, net | (49,430) | (152,825) | (75,769) | (308,095) | |||||||||||||||||||
| (Loss) Earnings from Continuing Operations Before Taxes | (130,606) | 55,823 | 75,616 | 108,971 | |||||||||||||||||||
| Income Tax Benefit (Expense) from Continuing Operations | 45,088 | (50,576) | (28,021) | (107,725) | |||||||||||||||||||
| Net (Loss) Earnings of the Group from Continuing Operations | (85,518) | 5,247 | 47,595 | 1,246 | |||||||||||||||||||
| Net Loss of the Group from Discontinued Operations, net of tax | (2,890) | (5,550) | (2,336) | (6,551) | |||||||||||||||||||
| Net (Loss) Earnings of the Group | (88,408) | (303) | 45,259 | (5,305) | |||||||||||||||||||
| Net Loss Attributable to Noncontrolling Interests from Continuing Operations | 10,863 | 11,731 | 8,423 | 5,651 | |||||||||||||||||||
| Net Loss (Earnings) Attributable to Redeemable Noncontrolling Interests | 31,662 | (5,816) | 25,943 | (12,863) | |||||||||||||||||||
| Net (Loss) Earnings Attributable to Jacobs from Continuing Operations | (42,993) | 11,162 | 81,961 | (5,966) | |||||||||||||||||||
| Net Loss Attributable to Jacobs from Discontinued Operations | (2,890) | (5,550) | (2,336) | (6,551) | |||||||||||||||||||
| Net (Loss) Earnings Attributable to Jacobs | $ | (45,883) | $ | 5,612 | $ | 79,625 | $ | (12,517) | |||||||||||||||
| Net Earnings Per Share: | |||||||||||||||||||||||
| Basic Net (Loss) Earnings from Continuing Operations Per Share | $ | (0.32) | $ | 0.10 | $ | 0.81 | $ | — | |||||||||||||||
| Basic (Loss) from Discontinuing Operations Per Share | $ | (0.02) | $ | (0.05) | $ | (0.02) | $ | (0.05) | |||||||||||||||
| Basic (Loss) Earnings Per Share | $ | (0.34) | $ | 0.06 | $ | 0.79 | $ | (0.05) | |||||||||||||||
| Diluted Net (Loss) Earnings from Continuing Operations Per Share | $ | (0.32) | $ | 0.10 | $ | 0.81 | $ | — | |||||||||||||||
| Diluted (Loss) from Discontinuing Operations Per Share | $ | (0.02) | $ | (0.05) | $ | (0.02) | $ | (0.05) | |||||||||||||||
| Diluted (Loss) Earnings Per Share | $ | (0.34) | $ | 0.06 | $ | 0.79 | $ | (0.05) | |||||||||||||||
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Overview – Three and Six Month Periods Ended March 27, 2026
Net loss attributable to the Company from continuing operations for the second fiscal quarter of 2026 was $(43.0) million (or $(0.32) per diluted share), a decrease of $54.2 million, from net earnings of $11.2 million (or $0.10 per diluted share) for the corresponding period last year. Favorable period over period underlying operating performance was seen in the second fiscal quarter of 2026, resulting from higher gross profit of $56.5 million compared to the corresponding period last year, primarily driven by stronger performance in our Infrastructure & Advanced Facilities ("I&AF") operating segment (mainly in our Global Operations, International and Americas sectors as discussed further below in the Segment Financial Information section). These favorable operating results were more than offset by unfavorable increases in SG&A expense associated with the PA Consulting Transaction, including $207.0 million in incremental expense mainly from the full vesting of remaining equity-based incentive grants, incremental compensation costs of $123.9 million in accrued distributions associated with the PA Consulting employee benefit trust, and other incentives, as well as restructuring charges and transaction costs incurred in connection with the PA Consulting Transaction. These net unfavorable impacts were partly offset by a decrease in restructuring and other charges and transaction costs associated with the Separation Transaction compared to the fiscal 2025 period (mainly professional services and employee separation costs), which are discussed in Note 16- Restructuring and Other Charges. The above net unfavorable impacts to our results were partly offset by a decrease in miscellaneous expense of $85.6 million primarily due to the absence of prior year 2025 mark-to-market losses of $109.5 million related to our former investment in Amentum stock in connection with the Separation Transaction as well as the absence of the prior year $20.5 million in discounts and expenses recorded to Loss on extinguishment of debt associated with our Equity-for-Debt Transaction on March 13, 2025, where the Company exchanged shares of our former investment in Amentum Holdings, Inc. for a principal amount of term loans under the 2021 Term Loan Facility that were immediately extinguished (see Note 12- Borrowings and Note 14- Discontinued Operations), partially offset by $20.5 million in losses on the settlement of the foreign exchange forward contract in connection with the PA Consulting Transaction in our current year results. Our results were also impacted by a $37.5 million increase in the Company's redeemable noncontrolling share of expense associated with equity-based incentive grants compared to the prior year period as mentioned above, partly offset by higher net earnings results in our PA Consulting segment.
For the six months ended March 27, 2026, net earnings attributable to the Company from continuing operations were $82.0 million (or $0.81 per diluted share), an increase of $87.9 million, from net loss of $(6.0) million (or $0.00 per diluted share) for the corresponding period last year. Our reported net earnings for the six months ended March 27, 2026 were favorably impacted by higher gross profit of $100.5 million compared to the corresponding period last year, primarily driven by stronger performance in our Infrastructure & Advanced Facilities ("I&AF") operating segment (mainly in our International and Global Operations sectors, as discussed further below in the Segment Financial Information section). These favorable operating results were offset by unfavorable increases in SG&A expense associated with the PA Consulting Transaction, including $223.7 million in incremental expense mainly from the full vesting of remaining equity-based incentive grants, incremental compensation costs of $123.9 million in accrued distributions associated with the PA Consulting employee benefit trust, and other incentives, as well as restructuring charges and other transaction costs incurred in connection with the PA Consulting Transaction. Our results were also favorably impacted by a decrease in miscellaneous expense of $216.0 million primarily due to the absence of prior year 2025 mark-to-market losses of $254.7 million related to our former investment in Amentum stock in connection with the Separation Transaction as well as absence of prior year $20.5 million in discounts and expenses recorded to Loss on extinguishment of debt associated with our Equity-for-Debt Transaction on March 13, 2025, where the Company exchanged shares of our former investment in Amentum Holdings, Inc. for a principal amount of term loans under the 2021 Term Loan Facility that were immediately extinguished (see Note 12- Borrowings and Note 14- Discontinued Operations), partially offset by $20.5 million in losses on the settlement of the foreign exchange forward contract in connection with the PA Consulting Transaction in our current year results. Our results were also impacted by a $38.8 million increase in the Company's redeemable noncontrolling share of expense associated with equity-based incentive grants compared to the prior year period as mentioned above, partly offset by higher net earnings results in our PA Consulting segment.
Income tax benefit (expense) for the three and six months ended March 27, 2026 was $45.1 million and $(28.0) million, respectively, as compared to $(50.6) million and $(107.7) million in the corresponding periods last year. The changes in income taxes for the periods presented were due mainly to tax impacts associated with the PA Consulting Transaction and our former investment in Amentum Stock. See Consolidated Results of Operations below for further detail.
For discussion of discontinued operations, see Note 14- Discontinued Operations.
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On January 2, 2026, Jacobs entered into the Implementation Deed with PA Consulting. Pursuant to the Implementation Deed and certain related agreements, and in accordance with the terms and conditions thereof, on March 20, 2026, Jacobs completed the transaction to acquire from shareholders of PA Consulting all of the remaining issued share capital of PA Consulting ("PA Shares") owned by the PA Consulting shareholders (excluding shares already held by Jacobs and its affiliates). The Company acquired the PA Shares for an aggregate initial consideration of approximately £1.21 billion which was paid through a combination of approximately £997.6 million in cash (net of certain PA Consulting shareholder expenses) and 2,043,537 newly issued shares of Jacobs' common stock, par value $1.00 per share (“Company Common Stock”). Also, on March 20, 2028, the Company will pay an additional £75 million in consideration with shares of Company Common Stock, cash or a combination thereof (as determined by the Company in its sole discretion), with accruals associated with this additional consideration reflected in Other deferred liabilities on the Consolidated Balance Sheet as of March 27, 2026. The transactions described in this paragraph, are collectively referred to as the “PA Consulting Transaction”. As a result of the PA Consulting Transaction, the Company no longer carries Redeemable Noncontrolling Interests on the Jacobs Consolidated Financial Statements. See Note 15- PA Consulting Redeemable Noncontrolling Interests for more discussion on the transaction and Note 12- Borrowings for more discussion on the financing for the transaction.
Consolidated Results of Operations
Revenues for the second fiscal quarter of 2026 were $3.69 billion, an increase of $784.5 million, or 27.0%, from $2.91 billion for the corresponding period last year. For the six months ended March 27, 2026, revenues were $6.99 billion, an increase of $1,144.8 million, or 19.6%, from $5.84 billion for the corresponding period last year. Revenue increases for both the three and six month periods year over year were mainly driven by the Company's I&AF business, as well as year-over-year revenue growth in our PA Consulting business. The I&AF segment benefited primarily from stronger performance in our Global Operations, International and Americas sectors for both the quarterly and year to date comparative periods presented. Our revenues were also favorably impacted by foreign currency translation of $77.6 million and $115.4 million for the three and six months ended March 27, 2026, respectively, across our international businesses, as compared to unfavorable impacts of $18.8 million and $2.3 million for the for the three and six months ended March 28, 2025, respectively.
Gross profit for the second fiscal quarter of 2026 was $794.9 million, an increase of $56.5 million, or 7.7%, from $738.3 million for the corresponding period last year, with gross profit margins of 21.5% and 25.4% for the respective periods. Gross profit for the six months ended March 27, 2026 was $1,560.1 million, an increase of $100.5 million, or 6.9%, from $1,459.6 million for the corresponding period last year, with gross profit margins of 22.3% and 25.0% for the respective periods. The Company's increase in gross profit was mainly attributable to higher revenues as mentioned above, with overall margin impacts from year-over-year project mix, higher revenues associated with pass-through cost as well as lower utilization trends primarily in the PA Consulting business.
See Segment Financial Information discussion for further information on the Company’s results of operations at the operating segment.
Selling, general & administrative expenses for the three and six months ended March 27, 2026 were $876.1 million and $1,408.8 million, respectively, as compared to $529.7 million and $1,042.5 million for the corresponding periods last year, representing an increase of $346.4 million or 65.4% and $366.2 million or 35.1%, respectively. SG&A expenses for the three and six months ended March 27, 2026 were impacted by increases in expense associated with the PA Consulting Transaction, including $207.0 million and $223.7 million, respectively, in incremental expense mainly from the full vesting of remaining equity-based incentive grants, incremental compensation costs of $123.9 million in accrued distributions associated with the PA Consulting Transaction employee benefit trust, and other incentives, and an increase in restructuring charges and other transaction costs of $1.3 million and $5.0 million, respectively. SG&A expenses were also impacted by increases in underlying personnel costs, expenses associated with IT related software licensing and other IT costs and other department spend. These incremental SG&A expenses were partly offset by decreases of $2.5 million and $15.3 million, respectively, in Restructuring and other charges associated with the Separation Transaction (mainly comprised of professional services), and reductions of $8.4 million and $16.3 million, respectively, in expenses associated with the TSA with Amentum. Lastly, SG&A expenses were further impacted by unfavorable foreign exchange of $38.1 million and $45.8 million for the three and six months ended March 27, 2026, as compared to favorable impacts of $4.9 million and $1.7 million for the corresponding periods last year.
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Net interest expense for the three and six months ended March 27, 2026 was $31.8 million and $58.4 million, respectively, an increase of $2.7 million and $4.2 million from $29.1 million and $54.2 million or 9.4% and 7.7%, respectively, for the corresponding periods last year. The increase in net interest expense for the three and six months ended March 27, 2026 was primarily a result of the Company's higher average levels of outstanding debt compared to the last fiscal year, partially offset by lower interest rates in the current year compared to the prior year period.
Loss on extinguishment of debt for the three and six months ended March 28, 2025 was $20.5 million, in discounts and expenses associated with the Equity-for-Debt Transaction executed on March 13, 2025, where the Company exchanged shares of our former investment in Amentum Holdings, Inc. for a principal amount of term loans under the 2021 Term Loan Facility, which term loans were immediately extinguished. See Note 12- Borrowings and Note 14- Discontinued Operations.
Miscellaneous expense, net for the three and six months ended March 27, 2026 was $(17.7) million and $(17.4) million, respectively, a decrease of $85.6 million and $216.0 million from $(103.3) million and $(233.4) million, respectively, for the corresponding periods last year. The favorability compared to the corresponding period last year was primarily due to the absence of three and six month periods ended March 28, 2025 mark-to-market losses and other related expenses associated with our former investment in Amentum stock in connection with the Separation Transaction of $109.5 million and $254.7 million, respectively. These favorable items were partially offset for the three and six months ended March 27, 2026 by a decrease of $10.3 million and $21.6 million in TSA-related income associated with the Separation Transaction as discussed in Note 14- Discontinued Operations. In addition, the current year's three and six month results included $20.5 million in losses on the settlement of the foreign exchange forward contract in connection with the PA Consulting Transaction.
The Company’s effective tax rates from continuing operations for the three months ended March 27, 2026 and March 28, 2025 were 34.5% and 90.6%, respectively. Significant items contributing to differences between the statutory U.S. federal corporate tax rate of 21.0% and the Company's effective tax rate for the three-month period ended March 27, 2026 included $13.0 million related to non-deductible incentive compensation associated with the Company's PA Consulting investment and $3.0 million of U.S. state income taxes. These items are expected to have a continuing impact on the Company's effective tax rate for the remainder of the fiscal year.
The most significant items contributing to the difference between the statutory U.S. federal corporate tax rate of 21.0% and the Company's effective tax rate of 90.6% for the three-month period ended March 28, 2025 were related to $33.1 million in unfavorable tax impacts associated with the non-deductibility of losses from the Company's former investment in Amentum stock, as well as U.S. state income tax expense of $4.0 million and U.S. tax on foreign earnings of $4.5 million.
The Company’s effective tax rates from continuing operations for the six months ended March 27, 2026 and March 28, 2025 were 37.1% and 98.9%, respectively. Significant items contributing to the difference between the statutory U.S. federal corporate tax rate of 21.0% and the Company's effective tax rate for the six-month period ended March 27, 2026 included unfavorable tax impacts of $7.5 million related to non-deductible incentive compensation associated with the Company's PA Consulting investment, as mentioned above, as well as $3.4 million related to other non-deductible expenses arising from the PA Consulting Transaction on March 20, 2026. These items are expected to have a continuing impact on the Company's effective tax rate for the remainder of the fiscal year.
The most significant item contributing to the difference between the statutory U.S. federal corporate tax rate of 21.0% and the Company's effective tax rate of 98.9% for the six-month period ended March 28, 2025 were related to $70.1 million in unfavorable tax impacts associated with the non-deductibility of losses from the Company's former investment in Amentum stock, as well as U.S. state income tax expense of $9.4 million and U.S. tax on foreign earnings of $9.4 million.
Net loss attributable to noncontrolling interests for the three and six months ended March 27, 2026 were $10.9 million and $8.4 million, respectively, as compared to $11.7 million and $5.7 million for the corresponding periods last year, due to lower comparative earnings results from our joint ventures in the current year period, partially offset by lower current period charges in connection with the Consolidated JV Matter.
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Net loss attributable to redeemable noncontrolling interests for the three and six months ended March 27, 2026 were $31.7 million and $25.9 million, respectively, as compared to net earnings of $(5.8) million and $(12.9) million for the corresponding periods last year. These changes in redeemable noncontrolling interests primarily reflects unfavorable impacts in the Company's noncontrolling share of expense associated with equity-based incentive grant vesting activities compared to the prior year period as discussed in Note 15- PA Consulting Redeemable Noncontrolling Interests, partly offset by higher net underlying earnings results in our PA Consulting segment compared to the prior year period.
Restructuring and Other Charges
During fiscal 2023, the Company implemented restructuring initiatives relating to the Separation Transaction. The Company incurred approximately $9.4 million during the six months ended March 27, 2026 and $28.2 million and $42.0 million in fiscal 2025 and fiscal 2024, respectively, in pre-tax cash charges in connection with these initiatives. These actions were substantially completed at the end of calendar year 2025 and are expected to result in estimated gross annualized pre-tax cash savings of approximately $185 million to $225 million.
During third quarter fiscal 2023, the Company approved a plan to improve business processes and cost structures of our PA Consulting investment by reorganizing senior management and reducing headcount. In connection with these initiatives, which are substantially completed, the Company incurred approximately $0.4 million during the six months ended March 27, 2026 and $1.9 million, $6.4 million and $14.3 million in fiscal 2025, 2024 and 2023, respectively, in pre-tax cash charges. These activities are expected to result in estimated gross annualized pre-tax cash savings of approximately $50 million to $65 million.
Refer to Note 16– Restructuring and Other Charges for further information regarding restructuring and integration initiatives.
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Segment Financial Information
The following tables present total revenues, direct cost of contracts, selling, general and administrative expenses and segment operating profit from continuing operations for each reportable segment (in thousands) and includes a reconciliation of segment operating profit to total U.S. GAAP operating profit from continuing operations by including certain corporate-level expenses, Restructuring and other charges (as defined in Note 16- Restructuring and Other Charges) and transaction and integration costs (in thousands) for the periods ended:
| For the three months ended | For the six months ended | ||||||||||||||||||||||||||||||||||
| March 27, 2026 | March 27, 2026 | ||||||||||||||||||||||||||||||||||
| Infrastructure & Advanced Facilities | PA Consulting | Total | Infrastructure & Advanced Facilities | PA Consulting | Total | ||||||||||||||||||||||||||||||
Revenues from External Customers (1) | $ | 3,336,307 | $ | 358,574 | $ | 3,694,881 | $ | 6,275,155 | $ | 713,007 | $ | 6,988,162 | |||||||||||||||||||||||
| Direct cost of contracts | (2,666,239) | (233,749) | (2,899,988) | (4,959,401) | (468,618) | (5,428,019) | |||||||||||||||||||||||||||||
| Selling, general and administrative expenses | (444,845) | (44,961) | (489,806) | (875,789) | (79,633) | (955,422) | |||||||||||||||||||||||||||||
Segment Operating Profit (1) | $ | 225,223 | $ | 79,864 | $ | 305,087 | $ | 439,965 | $ | 164,756 | $ | 604,721 | |||||||||||||||||||||||
Restructuring, Transaction and Other Charges (2) | (352,200) | (381,277) | |||||||||||||||||||||||||||||||||
| Amortization of Intangible Assets | (34,063) | (72,059) | |||||||||||||||||||||||||||||||||
| Total U.S. GAAP Operating Profit | $ | (81,176) | $ | 151,385 | |||||||||||||||||||||||||||||||
Total Other (Expense) Income, net (3) | (49,430) | (75,769) | |||||||||||||||||||||||||||||||||
| Earnings from Continuing Operations Before Taxes | $ | (130,606) | $ | 75,616 | |||||||||||||||||||||||||||||||
| (1) | The three and six months ended March 27, 2026 I&AF revenue and operating profit in comparison to the corresponding periods for fiscal 2025 reflected lower charges in connection with the Consolidated JV Matter (as defined below). | ||||
| (2) | The three and six months ended March 27, 2026 included $214.9 million and $237.5 million, respectively, in charges for certain subsidiary level compensation based agreements as well as $120.4 million and $122.7 million, respectively, in costs relating to the PA Consulting Transaction, $123.9 million of which represents consideration to be distributed to PA Consulting employees as compensation expense. The three and six months ended March 27, 2026 included $7.6 million and $9.9 million, respectively, in restructuring and other charges relating to the Separation Transaction (primarily professional services and employee separation costs), as well as $6.5 million and $8.3 million, respectively, in restructuring and other charges relating to the PA Consulting Transaction (primarily professional services and dedicated internal personnel). | ||||
| (3) | The three and six months ended March 27, 2026 included a $20.5 million loss on the foreign exchange forward contract in connection with the PA Consulting Transaction (see Note 17- Commitments and Contingencies and Derivative Financial Instruments). | ||||
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| For the Three Months Ended | For the six months ended | ||||||||||||||||||||||||||||||||||
| March 28, 2025 | March 28, 2025 | ||||||||||||||||||||||||||||||||||
| Infrastructure & Advanced Facilities | PA Consulting | Total | Infrastructure & Advanced Facilities | PA Consulting | Total | ||||||||||||||||||||||||||||||
Revenues from External Customers (1) | $ | 2,602,753 | $ | 307,662 | $ | 2,910,415 | $ | 5,228,961 | $ | 614,410 | $ | 5,843,371 | |||||||||||||||||||||||
| Direct cost of contracts | (1,980,582) | (191,488) | (2,172,070) | (4,000,277) | (383,482) | (4,383,759) | |||||||||||||||||||||||||||||
| Selling, general and administrative expenses | (418,906) | (48,827) | (467,733) | (815,145) | (96,844) | (911,989) | |||||||||||||||||||||||||||||
Segment Operating Profit (1) | $ | 203,265 | $ | 67,347 | $ | 270,612 | $ | 413,539 | $ | 134,084 | $ | 547,623 | |||||||||||||||||||||||
Restructuring, Transaction and Other Charges (2) | (23,924) | (53,856) | |||||||||||||||||||||||||||||||||
| Amortization of Intangible Assets | (38,040) | (76,701) | |||||||||||||||||||||||||||||||||
| Total U.S. GAAP Operating Profit | $ | 208,648 | $ | 417,066 | |||||||||||||||||||||||||||||||
Total Other (Expense) Income, net (3) | (152,825) | (308,095) | |||||||||||||||||||||||||||||||||
| Earnings from Continuing Operations Before Taxes | $ | 55,823 | $ | 108,971 | |||||||||||||||||||||||||||||||
| (1) | The three and six months ended March 28, 2025 I&AF revenue and operating profit were impacted by a reserve in connection with an unfavorable interim ruling against a consolidated joint venture in which the Company holds a 50% interest (the "Consolidated JV Matter"), with the noncontrolling partner’s share included in noncontrolling interests in the Consolidated Statements of Earnings for the respective period. | ||||
| (2) | The three and six months ended March 28, 2025 included $10.2 million and $25.1 million, respectively, in restructuring and other charges relating to the Separation Transaction (primarily professional services and employee separation costs), as well as $8.0 million and $13.9 million, respectively, in charges for certain subsidiary level compensation based agreements. The three and six months ended March 28, 2025 included approximately $8.4 million and $16.2 million, respectively, in charges associated with the Company's TSA with Amentum. | ||||
| (3) | The three and six months ended March 28, 2025 included $109.5 million and $254.7 million, respectively, in mark-to-market losses and other related charges associated with our former investment in Amentum stock in connection with the Separation Transaction, as well as $10.3 million and $21.7 million, respectively, in income associated with the Company's TSA with Amentum (see Note 14- Discontinued Operations). The three and six months ended March 28, 2025 included $20.5 million in discounts and expenses associated with the Equity for-Debt Transaction (see Note 12- Borrowings and Note 14- Discontinued Operations). | ||||
In evaluating the Company’s performance by operating segment, the Chief Operating Decision Maker ("CODM") reviews various metrics and statistical data for Infrastructure & Advanced Facilities and PA Consulting. For more information, please refer to Note 18- Segment Information. In addition, the Company attributes each segment's specific incentive compensation plan costs to the segments. The methods for recognizing revenue, incentive fees, project losses and change orders are consistent among the segments.
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Infrastructure & Advanced Facilities
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
(in thousands) | March 27, 2026 | March 28, 2025 | March 27, 2026 | March 28, 2025 | |||||||||||||||||||
Revenues | $ | 3,336,307 | $ | 2,602,753 | $ | 6,275,155 | $ | 5,228,961 | |||||||||||||||
| Operating Profit | $ | 225,223 | $ | 203,265 | $ | 439,965 | $ | 413,539 | |||||||||||||||
Revenues for the I&AF segment for the three and six months ended March 27, 2026 were $3.3 billion and $6.3 billion, respectively, an increase of $733.6 million and $1,046.2 million, or 28% and 20%, compared to $2.6 billion and $5.2 billion for the corresponding periods last year. The increase in revenues for the three and six months ended March 27, 2026 was driven primarily from stronger performance in its Global Operations, along with the Americas and International sectors performing strongly across markets and geographies. Revenues for the three and six months ended March 27, 2026 in comparison to the corresponding periods for fiscal 2025 reflected lower charges in connection with the Consolidated JV Matter. Additionally, foreign currency translation had approximately $54.9 million and $79.8 million in favorable impacts on revenues for the three and six months ended March 27, 2026, as compared to $17.6 million and $10.7 million in unfavorable impact in the corresponding prior year periods. | ||
Operating profit for the I&AF segment for the three and six months ended March 27, 2026 was $225.2 million and $440.0 million, respectively, an increase of $22.0 million and $26.4 million, or 11% and 6%, from $203.3 million and $413.5 million for the corresponding periods last year. The increase for the three and six months ended March 27, 2026 was driven primarily by the revenue growth mentioned above, with margin impacts from higher revenues associated with pass-through cost, partially offset by an increase in Selling, general and administrative expenses. Operating profit for the three and six months ended March 27, 2026 in comparison to the corresponding periods for fiscal 2025 reflected lower charges in connection with the Consolidated JV Matter. Foreign currency translation had approximately $4.9 million and $8.1 million in favorable impacts on operating profit for three and six months ended March 27, 2026, as compared to $1.4 million and $0.7 million in unfavorable impacts in the corresponding prior year periods. | ||
PA Consulting
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| (in thousands) | March 27, 2026 | March 28, 2025 | March 27, 2026 | March 28, 2025 | |||||||||||||||||||
Revenues | $ | 358,574 | $ | 307,662 | $ | 713,007 | $ | 614,410 | |||||||||||||||
| Operating Profit | $ | 79,864 | $ | 67,347 | $ | 164,756 | $ | 134,084 | |||||||||||||||
Revenues for the PA Consulting segment for the three and six months ended March 27, 2026 were $358.6 million and $713.0 million, respectively, reflecting an increase of $50.9 million and $98.6 million, or 17% and 16% from $307.7 million and $614.4 million in the corresponding periods last year. The increase in revenues was due primarily to growth in PA Consulting's public services businesses (through the public services and defence and security sectors). Foreign currency translation had approximately $22.7 million and $35.6 million in favorable impacts on revenues for the three and six months ended March 27, 2026, as compared to $1.2 million in unfavorably and $8.3 million in favorable impacts in the corresponding prior year periods. | ||
Operating profit for the segment for the three and six months ended was $79.9 million and $164.8 million, an increase of $12.5 million and $30.7 million, or 19% and 23% from $67.3 million and $134.1 million in the corresponding periods last year. The year-over-year increase was mainly attributable to improved revenues as mentioned above. | ||
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Backlog Information
Backlog represents revenue we expect to realize for work to be completed by our consolidated subsidiaries and our proportionate share of work to be performed by unconsolidated joint ventures. Because of variations in the nature, size, expected duration, funding commitments, and the scope of services required by our contracts, the amount and timing of when backlog will be recognized as revenues includes significant estimates and can vary greatly between individual contracts.
Consistent with industry practice, substantially all of our contracts are subject to cancellation or termination at the option of the client, including our U.S. government work. While management uses all information available to determine backlog, at any given time our backlog is subject to changes in the scope of services to be provided as well as increases or decreases in costs relating to the contracts included therein. Backlog is not necessarily an indicator of future revenues.
Because certain contracts (e.g., contracts relating to large engineering, procurement & construction projects as well as national government programs) can cause large increases to backlog in the fiscal period in which we recognize the award, and because many of our contracts require us to provide services that span over several fiscal quarters (and sometimes over fiscal years), we have presented our backlog on a year-over-year basis, rather than on a sequential, quarter-over-quarter basis.
The following table summarizes our backlog at March 27, 2026 and March 28, 2025 (in millions):
| March 27, 2026 | March 28, 2025 | ||||||||||
| Infrastructure & Advanced Facilities | $ | 26,538 | $ | 21,768 | |||||||
| PA Consulting | 427 | 392 | |||||||||
| Total | $ | 26,965 | $ | 22,160 | |||||||
The increase in backlog in I&AF from March 28, 2025 was predominantly driven by growth across Advanced Manufacturing, Life Sciences, and Transportation markets. | ||
The increase in backlog in PA Consulting from March 28, 2025 was primarily driven by organic year-over-year growth of the business. | ||
Consolidated backlog differs from the Company’s remaining performance obligations as defined by ASC 606 primarily because of contract change orders or new wins not yet processed and our national government contracts where our policy is to generally include in backlog the contract award, whether funded or unfunded excluding certain option periods while our remaining performance obligations represent a measure of the total dollar value of work to be performed on contracts awarded and in progress. Additionally, the Company does not include our proportionate share of backlog related to unconsolidated joint ventures in our remaining performance obligations.
Liquidity and Capital Resources
At March 27, 2026, our principal sources of liquidity consisted of $1.37 billion in cash and cash equivalents and $994.7 million of available borrowing capacity under our $1.50 billion revolving credit agreement (the "JSI Revolving Credit Facility"). See Note 12- Borrowings for more information. We finance most of our operations and growth through cash generated by our operations.
Cash and cash equivalents at March 27, 2026 were $1.37 billion, representing an increase of $136.5 million from $1.24 billion at September 26, 2025, the reasons for which are described below.
The Company also holds approximately $116.5 million in restricted cash as of March 27, 2026 (reported in Prepaid expenses and other in the Consolidated Balance Sheets), the majority of which relates to the PA Consulting employee benefit trust and was received in connection with the March 20, 2026 PA Consulting Transaction, with approximately $100 million expected to be paid out in the third fiscal quarter of 2026. See Note 15- PA Consulting Redeemable Noncontrolling Interests in the Consolidated Financial Statements.
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The following table presents selected consolidated cash flow information of the Company for the respective periods shown below:
| For the Six Months Ended | |||||||||||
| (In thousands) | March 27, 2026 | March 28, 2025 | |||||||||
| Net cash (used for) provided by operating activities | $ | (103,361) | $ | 11,025 | |||||||
| Cash Flows from Investing Activities: | |||||||||||
| Additions to property and equipment | (36,597) | (27,603) | |||||||||
| Disposals of property and equipment and other assets | 4,506 | 2,328 | |||||||||
| Capital contributions to equity investees, net of return of capital distributions | 334 | 932 | |||||||||
| Net cash used for investing activities | (31,757) | (24,343) | |||||||||
| Cash Flows from Financing Activities: | |||||||||||
| Proceeds from long-term borrowings | 3,852,000 | 1,848,201 | |||||||||
| Repayments of long-term borrowings | (1,995,828) | (444,800) | |||||||||
| Repayments of short-term borrowings | — | (656,981) | |||||||||
| Debt issuance costs | (15,447) | (92) | |||||||||
| Proceeds from issuances of common stock | 17,216 | 17,186 | |||||||||
| Common stock repurchases | (471,844) | (552,402) | |||||||||
| Taxes paid on vested restricted stock | (22,240) | (21,088) | |||||||||
| Cash dividends to shareholders | (81,196) | (75,878) | |||||||||
| Net dividends associated with noncontrolling interests | (7,032) | (3,446) | |||||||||
| Repurchase of redeemable noncontrolling interests | (883,623) | (4,066) | |||||||||
| Net cash provided by financing activities | 392,006 | 106,634 | |||||||||
| Effect of Exchange Rate Changes | (5,292) | (34,773) | |||||||||
| Net Increase in Cash and Cash Equivalents and Restricted Cash | 251,596 | 58,543 | |||||||||
| Cash and Cash Equivalents, including Restricted Cash, at the Beginning of the Period | 1,236,816 | 1,146,931 | |||||||||
| Cash and Cash Equivalents, including Restricted Cash, at the End of the Period | $ | 1,488,412 | $ | 1,205,474 | |||||||
Our net cash flow used for operations of $103.4 million during the six months ended March 27, 2026 was unfavorable by $114.4 million in comparison to the cash flow provided by operations of $11.0 million in the corresponding prior year period. The decline was largely due a one time payment of $232.5 million in relation to the PA Consulting Transaction associated with the settlement of the equity-based incentive grants within other deferred liabilities. These decreases were offset in part by lower cash income tax payments in the current year and other items.
Our net cash used for investing activities during the six months ended March 27, 2026 was $31.8 million, compared to cash used for investing activities of $24.3 million in the corresponding prior year period due to higher levels of additions to plant, property and equipment in the current year.
Our net cash provided by financing activities during the six months ended March 27, 2026 was $392.0 million. This was driven by net proceeds of borrowings of $1.9 billion, offset by $883.2 million in proceeds paid for the repurchase of the remaining redeemable noncontrolling interest shares in connection with the PA Consulting Transaction, common stock repurchases of $471.8 million, $81.2 million in dividends to shareholders, and $22.2 million in taxes paid on vested restricted stock. Net cash provided by financing activities in the corresponding prior year period was $106.6 million, due primarily to net proceeds from borrowings of $746.4 million, partly offset by common stock repurchases of $552.4 million, $75.9 million in dividends to shareholders, and $21.1 million in taxes paid on vested restricted stock.
At March 27, 2026, the Company had approximately $161.8 million in cash and cash equivalents held in the U.S. and $1.21 billion held outside of the U.S. (primarily in the U.K., the Eurozone, Australia, India, Canada, and the Middle East region). Other than the tax cost of repatriating funds to the U.S., there are no material impediments to repatriating these funds to the U.S.
The Company had $253.4 million in letters of credit outstanding at March 27, 2026. Of this amount, $0.3 million was issued under the JSI Revolving Credit Facility and $253.1 million was issued under separate, committed and uncommitted letter-of-credit facilities.
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Long-term debt as of March 27, 2026 increased by $1.8 billion compared to September 26, 2025 primarily due to the issuance of the 4.75% Bonds and 5.375% Bonds totaling $1.3 billion, partly offset by a decrease in outstanding Term Loan Facilities as a result of the current quarter refinancing activities (see Note 12- Borrowings). Proceeds from these financing activities were used to fund the PA Consulting Transaction, share buybacks, dividends and taxes paid on vested restricted stock.
On March 13, 2025, Jacobs completed the Equity-for-Debt Transaction (see Note 12- Borrowings for additional information), pursuant to which the Company extinguished $311.5 million under the GBP 2021 Term Loan, in exchange for its approximately 19.5 million shares in Amentum. Additionally, as noted below, on March 27, 2025, the Company and its subsidiary, entered into the 2025 Term Loan Facility (as noted below), the proceeds of which were used to extinguish the remaining $531.6 million under the GBP 2021 Term Loan contract. For more information, please refer to Note 12-Borrowings and Note 14- Discontinued Operations.
On March 27, 2025, the Company, as guarantor, and JEGI, as borrower, entered into a term loan agreement (the “2025 Term Loan Facility”) with Bank of America, N.A., as administrative agent and sole lead arranger, and the lender party thereto. Under the 2025 Term Loan Facility, JEGI borrowed a $200.0 million term loan and £410.0 million term loan for a term of two-years from the date of initial funding, maturing on March 26, 2027. The Company issued Bonds (as discussed below), the proceeds of which were used to extinguish the outstanding balances of the 2025 Term Loan Facilities. Please refer to Note 12- Borrowings for additional information.
In connection with the Post-Closing Additional Merger Consideration relating to the Separation Transaction, the Company received approximately 7.3 million Amentum shares from the 9.7 million shares held in escrow. On April 30, 2025, the Company's Board of Directors determined to distribute the 7.3 million shares of Amentum's stock and declared an in kind dividend payable to Jacobs’ shareholders of record as of May 16, 2025 which was distributed on a pro rata basis on May 30, 2025. Please refer to Note 14- Discontinued Operations for additional details.
On April 10, 2025, the Company collected $70 million in receivables related to final settlement of the post-closing working capital adjustment from the distribution of the SpinCo Business, the proceeds of which were immediately utilized to pay down amounts owed under the Company’s Revolving Credit Facility. Please refer to Note 14- Discontinued Operations for additional details.
On February 6, 2023 the Company refinanced its Revolving Credit Facility, and on February 16, 2023, the Company issued the 5.90% Bonds in the aggregate principal amount of $500.0 million. On August 18, 2023, the Company issued the 6.35% Bonds in the aggregate principal amount of $600.0 million. On March 16, 2026 the Revolving Credit Facility was repaid and a new revolving credit facility (the "JSI Revolving Credit Facility") was established with revised terms including those applicable to the Primary and Designated Borrowers as well as a reduced borrowing capacity. See Note 12- Borrowings for further discussion relating to the terms of the 5.90% Bonds, the 6.35% Bonds, and the Revolving Credit Facility following the issuances and refinancing.
On March 3, 2026, the Company issued the 4.75% Bonds and the 5.375% Bonds (see Note 12- Borrowings for further discussion relating to the terms of the bonds) and the Company immediately used the proceeds from these bonds to repay the then remaining outstanding 2025 Term Loan Facility principal equal to $200.0 million and £410.0 million.
On March 16, 2026 the Company, as borrower, and JEGI, as guarantor, entered into a term loan agreement (the “2026 Term Loan Facility”) with a syndicate of financial institutions as lenders. Under the 2026 Term Loan Facility, Company borrowed a $700.0 million term loan for a term of three-years from the date of initial funding, maturing on March 16, 2029 and $500.0 million term loan for a term of five-years from the date of initial funding, maturing on March 14, 2031. The proceeds from the 2026 Term Loan Facility proceeds were used to fund the PA Consulting Transaction, as discussed below.
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On January 2, 2026, Jacobs entered into the Implementation Deed with PA Consulting. Pursuant to the Implementation Deed and certain related agreements, and in accordance with the terms and conditions thereof, on March 20, 2026, Jacobs completed the transaction to acquire from shareholders of PA Consulting all of the remaining issued share capital of PA Consulting ("PA Shares") owned by the PA Consulting shareholders (excluding shares already held by Jacobs and its affiliates). The Company acquired the PA Shares for an aggregate initial consideration of approximately £1.21 billion which was paid through a combination of approximately £997.6 million in cash (net of certain PA Consulting shareholder expenses) and 2,043,537 newly issued shares of Jacobs' common stock, par value $1.00 per share (“Company Common Stock”). Jacobs funded the cash portion of the upfront consideration through a combination of cash-on-hand and incremental debt proceeds as discussed above. Also, on March 20, 2028, the Company will pay an additional £75 million in consideration with shares of Company Common Stock, cash or a combination thereof (as determined by the Company in its sole discretion), with accruals associated with this additional consideration reflected in Other deferred liabilities on the Consolidated Balance Sheet as of March 27, 2026. The transactions described in this paragraph, are collectively referred to as the “PA Consulting Transaction”. As a result of the PA Consulting Transaction, the Company no longer carries Redeemable Noncontrolling Interests on the Jacobs Consolidated Financial Statements. See Note 15- PA Consulting Redeemable Noncontrolling Interests for more discussion on the transaction and Note 12- Borrowings for more discussion on the financing for the transaction.
We believe we have adequate liquidity and capital resources to fund our projected cash requirements for acquisitions including remaining amounts payable associated with the PA Consulting Transaction as well as financing activities such as debt servicing, share buybacks and dividends for the next twelve months based on the liquidity provided by our cash and cash equivalents on hand, our borrowing capacity and our continuing cash generated from operations.
We were in compliance with all of our debt covenants at March 27, 2026.
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Supplemental Obligor Group Financial Information
On February 16, 2023, Jacobs Engineering Group Inc. ("JEGI"), a wholly-owned subsidiary of Jacobs Solutions Inc. (together, the "Obligor Group"), completed an offering of $500.0 million aggregate principal amount of 5.90% Bonds, due 2033 (the "5.90% Bonds") and on August 18, 2023, completed an offering of $600.0 million aggregate principal amount of 6.35% Bonds, due 2028 (the "6.35% Bonds"). The 5.90% Bonds and 6.35% Bonds are fully and unconditionally guaranteed by the Company. The 5.90% Bonds and the 6.35% Bonds and the respective guarantees thereof were offered pursuant to prospectus supplements, dated February 13, 2023 and August 15, 2023, respectively, to the prospectus dated February 6, 2023, that forms a part of the Company and JEGI’s automatic shelf registration statement on Form S-3ASR (File Nos. 333-269605 and 333-269605-01, respectively) previously filed with the SEC.
On March 3, 2026, the Company completed an offering of $800.0 million aggregate principal amount of 4.75% Bonds due 2031 (the "4.75% Bonds") and $500.0 million aggregate principal amount of 5.375% Bonds due 2036 (the "5.375% Bonds"). The 4.75% Bonds and 5.375% Bonds are fully and unconditionally guaranteed by JEGI. The 4.75% Bonds and the 5.375% Bonds, and the guarantees thereof were offered pursuant to a prospectus supplements dated February 24, 2026, to the prospectus dated February 2, 2026, that forms a part of the Company and JEGI’s automatic shelf registration statement on Form S-3ASR (File No. 333-293127 and 333-293127-01, respectively) previously filed with the SEC.
In accordance with SEC Regulation S-X Rule 13-01, set forth below is the summarized financial information for the Obligor Group on a combined basis after elimination of (i) intercompany transactions and balances between Jacobs and JEGI and (ii) equity in the earnings from and investments in all other subsidiaries of the Company that do not guarantee the registered securities of either Jacobs or JEG. This summarized financial information (in thousands) has been prepared and presented pursuant to Regulation S-X Rule 13-01, “Financial Disclosures about Guarantors and Issuers of Guaranteed Securities” and is not intended to present the financial position or results of operations of the Obligor Group in accordance with U.S. GAAP.
| Six Months Ended | |||||
| (in thousands) | March 27, 2026 | ||||
| Summarized Statement of Earnings Data | |||||
| Revenue | $ | 2,155,276 | |||
| Direct Costs | $ | 1,795,774 | |||
| Selling, General and Administrative Expenses | $ | 207,132 | |||
| Net loss attributable to Guarantor Subsidiaries from continuing operations | $ | 61,302 | |||
| Noncontrolling interests | $ | (1,068) | |||
| (in thousands) | March 27, 2026 | September 26, 2025 | |||||||||
| Summarized Balance Sheet Data | |||||||||||
| Current assets, less receivables from Non-Guarantor Subsidiaries | $ | 1,091,247 | $ | 938,319 | |||||||
| Current receivables from Non-Guarantor Subsidiaries | $ | 616,833 | $ | 749,475 | |||||||
| Noncurrent assets, less noncurrent receivables from Non-Guarantor Subsidiaries | $ | 570,375 | $ | 642,464 | |||||||
| Noncurrent receivables from Non-Guarantor Subsidiaries | $ | 504,830 | $ | 563,682 | |||||||
| Current liabilities | $ | 906,500 | $ | 1,006,916 | |||||||
| Long-term Debt | $ | 4,084,220 | $ | 2,236,456 | |||||||
| Other Noncurrent liabilities, less amounts payable to Non-Guarantor Subsidiaries | $ | 332,271 | $ | 250,106 | |||||||
| Noncurrent liabilities to Non-Guarantor Subsidiaries | $ | 988,149 | $ | 1,110,155 | |||||||
| Noncontrolling interests | $ | 10 | $ | 5 | |||||||
| Accumulated deficit | $ | (3,527,865) | $ | (1,709,698) | |||||||
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Item 3. Quantitative and Qualitative Disclosures About Market Risk.
We do not enter into derivative financial instruments for trading, speculation or other similar purposes that would expose the Company to market risk. In the normal course of business, our results of operations are exposed to risks associated with fluctuations in interest rates and currency exchange rates.
Interest Rate Risk
Please see the Note 12- Borrowings in Notes to Consolidated Financial Statements appearing under Part I, Item 1 of this Quarterly Report on Form 10-Q, which is incorporated herein by reference, for a discussion of the JSI Revolving Credit Facility, 2026 Term Loan Facility and Note Purchase Agreement.
Our JSI Revolving Credit Facility, 2026 Term Loan Facility and certain other debt obligations are subject to variable rate interest which could be adversely affected by an increase in interest rates. As of March 27, 2026, we had an aggregate of $1.71 billion in outstanding borrowings under our JSI Revolving Credit Facility and 2026 Term Loan Facility. Interest on amounts borrowed under these agreements is subject to adjustment based on the Company’s Consolidated Leverage Ratio (as defined in the credit agreements governing the JSI Revolving Credit Facility and the 2026 Term Loan Facility). Depending on the Company’s Consolidated Leverage Ratio, borrowings denominated in U.S. dollars under the JSI Revolving Credit Facility bear interest at a SOFR rate plus a margin of between 0.875% and 1.625% or a base rate plus a margin of between 0% and 0.625% including applicable margins. The three-year borrowings under the 2026 Term Loan Facility will bear interest at a SOFR rate plus a margin of between 0.75% and1.50% or a base rate plus a margin of between 0% and 0.50%. The five-year borrowings under the 2026 Term Loan Facility will bear interest at a SOFR rate plus a margin of between 0.875% and 1.625% or a base rate plus a margin of between 0% and 0.625%. Additionally, our 5.90% Bonds due 2033 have interest rates subject to potential increases relating to certain ESG metrics as stipulated in the related agreements and as discussed in Note 12- Borrowings.
However, as discussed in Note 17- Commitments and Contingencies and Derivative Financial Instruments, we are party to a swap agreement with a notional value of $200.0 million to convert the variable rate interest based liabilities associated with a corresponding amount of our debt into fixed interest rate liabilities, leaving $1.51 billion in principal amount subject to variable interest rate risk.
For the six months ended March 27, 2026, our weighted average floating rate borrowings that are subject to floating rate exposure were approximately $1.21 billion. If floating interest rates had increased by 1.00%, our interest expense for the six months ended March 27, 2026 would have increased by approximately $6.1 million.
Foreign Currency Risk
In situations where the Company incurs costs in currencies other than our functional currency, we sometimes enter into foreign exchange contracts to limit our exposure to fluctuating foreign currencies. We follow the provisions of ASC 815, Derivatives and Hedging in accounting for our derivative contracts. The Company has $1.9 billion in notional value of exchange rate sensitive instruments at March 27, 2026. In addition, on January 5, 2026, in connection with the PA Consulting Transaction, the Company entered into a foreign exchange contract with a notional value of $1.31 billion with an offsetting hedge entered into on March 12, 2026 with a notional value of $60.1 million, both of which were subsequently settled before March 27, 2026 . See Note 17- Commitments and Contingencies and Derivative Financial Instruments for discussion.
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Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
Disclosure controls and procedures are those controls and procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) are recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial officer), to allow timely decisions regarding required disclosure.
The Company’s management, with the participation of its Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial officer), evaluated the effectiveness of the Company’s disclosure controls and procedures as defined by Rule 13a-15(e) of the Exchange Act defined above, as of March 27, 2026, the end of the period covered by this Quarterly Report on Form 10-Q (the “Evaluation Date”). Based on that evaluation, the Company’s management, with the participation of the Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial officer) concluded that the Company’s disclosure controls and procedures, as of the Evaluation Date, were effective to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to the Company’s management, including the Company’s Chief Executive Officer (principal executive officer) and Chief Financial Officer (principal financial officer), as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control Over Financial Reporting
There were no changes to our internal control over financial reporting which were identified in connection with the evaluation required by paragraph (d) of Rules 13a-15 and 15d-15 under the Exchange Act during the quarter ended March 27, 2026 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
The information required by this Item 1 is included in Note 17- Commitments and Contingencies and Derivative Financial Instruments included in the Notes to Consolidated Financial Statements appearing under Part I, Item 1 of this Quarterly Report on Form 10-Q, which is incorporated herein by reference.
Item 1A. Risk Factors.
Please refer to Item 1A- Risk Factors in our 2025 Form 10-K, which is incorporated herein by reference, for a discussion of some of the factors that have affected our business, financial condition, and results of operations in the past and which could affect us in the future. There have been no material changes to those risk factors, except for the information disclosed elsewhere in this Quarterly Report on Form 10-Q that provides factual updates to those risk factors. Before making an investment decision with respect to our common stock, you should carefully consider those risk factors, as well as the financial and business disclosures contained in this Quarterly Report on Form 10-Q and our other current and periodic reports filed with the SEC.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.
On March 20, 2026, as part of the consideration for the PA Consulting Transaction, the Company issued 2,043,537 shares of Company Common Stock to certain PA Shareholders in reliance on the exemption from registration provided by Section 3(a)(10) of the Securities Act, and to others in reliance on the exemption from the registration requirements of the Securities Act by virtue of Section 4(a)(2) of the Securities Act and/or Rule 506 of Regulation D.
Share Repurchases
On January 30, 2025, the Company's Board of Directors authorized an incremental share repurchase program of up to $1.5 billion of the Company's common stock, to expire on January 30, 2028 (the "2025 Repurchase Authorization"). At March 27, 2026, the Company had $746.4 million remaining under the 2025 Repurchase Authorization.
An aggregate summary of repurchases of the Company’s common stock made during the second quarter of fiscal 2026 under the 2025 Share Repurchase Authorization follows:
| Period | Total Number of Shares Purchased | Average Price Paid Per Share (1) | Total Number of Shares Purchased under the 2025 Repurchase Authorizations | Approximate Dollar Value of Shares that May Yet Be Purchased Under the 2025 Repurchase Authorizations | ||||||||||||||||||||||
| December 27, 2025 - January 23, 2026 | 161,721 | $138.70 | 161,721 | $943,772,913 | ||||||||||||||||||||||
| January 24, 2026 - February 20, 2026 | 976,252 | $135.81 | 976,252 | $811,192,340 | ||||||||||||||||||||||
| February 21, 2026 - March 27, 2026 | 476,868 | $135.78 | 476,868 | $746,440,839 | ||||||||||||||||||||||
Total | 1,614,841 | 1,614,841 | ||||||||||||||||||||||||
(1)Includes commissions paid and excise tax due under the Inflation Reduction Act of 2022 and calculated at the average price per share.
Our share repurchase program does not obligate the Company to purchase any shares. Share repurchases may be executed through various means including, without limitation, accelerated share repurchases, open market transactions, privately negotiated transactions, purchases pursuant to Rule 10b5-1 plans or otherwise. The authorization for the share repurchase programs may be terminated, increased or decreased by the Company’s Board of Directors in its discretion at any time. The timing, amount and manner of share repurchases may depend upon market conditions and economic circumstances, availability of investment opportunities, the availability and costs of financing, currency fluctuations, the market price of the Company's common stock, other uses of capital and other factors.
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Item 3. Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosure.
None.
Item 5. Other Information.
During the period covered by this Quarterly Report on Form 10-Q, none of our officers or directors adopted terminated
Grant of Transaction Bonus
On April 29, 2026, the Human Resource and Compensation Committee of Jacobs' Board of Directors approved a special, one-time cash bonus in the amount of $250,000 for Shannon Miller, our President, Strategy, Growth & Digital, in recognition of her effort to successfully lead the acquisition activities related to the PA Consulting Transaction, which closed in March 2026.
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Item 6. Exhibits.
2.1 | Agreement and Plan of Merger, dated November 20, 2023, by and among Jacobs Solutions Inc., Amazon Holdco Inc., Amentum Parent Holdings LLC and Amentum Joint Venture LP. Filed as Exhibit 2.1 to the Registrant’s Current Report on Form 8-K on November 21, 2023 and incorporated herein by reference. | |||||||
2.2 | Amendment to Agreement and Plan of Merger, dated August 26, 2024, by and among Jacobs Solutions Inc., Amazon Holdco Inc., Amentum Parent Holdings LLC and Amentum Joint Venture LP. Filed as Exhibit 2,5 to the Registrant’s fiscal 2024 Annual Report on Form 10-K and incorporated herein by reference. | |||||||
2.3* | Implementation Deed, dated as of January 2, 2026, by and among PA Consulting Group Limited, Jacobs UK Holdings Limited, Jacobs Solutions Inc. and the persons set out in Schedule 1 thereto. Filed as Exhibit 2.1 to the Registrant's Current Report on Form 8-K on January 5, 2026 and incorporated herein by reference. | |||||||
3.1 | Restated Certificate of Incorporation of Jacobs Solutions Inc. Filed as Exhibit 3.2 to the Registrant’s Current Report on Form 8-K on February 3, 2025 and incorporated herein by reference. | |||||||
3.2 | Amended and Restated Bylaws of Jacobs Solutions Inc., dated as of July 31, 2025. Filed as Exhibit 3.2 to the Registrant's Quarterly Report on Form 10-Q for the third quarter of fiscal 2025 and incorporated herein by reference. | |||||||
4.1 | Third Supplemental Indenture, dated as of March 3, 2026, among the Company, Jacobs Engineering Group Inc. and U.S. Bank Trust Company, N.A.. Filed as Exhibit 4.2 to the Registrant's Current Report on Form 8-K on March 3, 2026 and incorporated herein by reference. | |||||||
4.2 | Form of the 4.750% Senior Notes due 2031, including the related Guarantee. Filed as part of Exhibit 4.2 to the Registrant's Current Report on Form 8-K on March 3, 2026 and incorporated herein by reference. | |||||||
4.3 | Form of the 5.375% Senior Notes due 2036, including the related Guarantee . Filed as part of Exhibit 4.2 to the Registrant's Current Report on Form 8-K on March 3, 2026 and incorporated herein by reference. | |||||||
10.1 | Credit Agreement, dated as of March 16, 2026, among Jacobs Solutions Inc., Jacobs Engineering Group Inc., certain of its wholly-owned subsidiaries as borrowers from time to time, the lenders party thereto, Bank of America, N.A., as administrative agent. Filed as Exhibit 10.1 to the Registrant's Current Report on Form 8-K on March 17, 2026 and incorporated herein by reference. | |||||||
10.2 | Term Loan Agreement, dated as of March 16, 2026, among Jacobs Solutions Inc., Jacobs Engineering Group Inc., the lenders party thereto, and Bank of America, N.A., as administrative agent. Filed as Exhibit 10.2 to the Registrant's Current Report on Form 8-K on March 17, 2026 and incorporated herein by reference. | |||||||
10.3#† | Jacobs Solutions Inc. Executive Severance Plan, as amended and restated effective January 30, 2026. | |||||||
| 22.1 | Subsidiary Issuers of Guaranteed Securities. Filed as Exhibit 22.1 to the Registrant’s Quarterly Report on Form 10-Q for the third quarter of fiscal 2024 and incorporated herein by reference. | |||||||
31.1† | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934. | |||||||
31.2† | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934. | |||||||
32.1† | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||||||
32.2† | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||||||
| 101 | The following financial statements from the Company’s Quarterly Report on Form 10-Q for the quarter ended March 27, 2026, formatted in Inline XBRL: (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Earnings, (iii) Consolidated Statements of Comprehensive Income (Loss), (iv) Consolidated Statements of Stockholders’ Equity, (v) Consolidated Statements of Cash Flows and (vi) Notes to Consolidated Financial Statements, tagged as blocks of text and including detailed tags. | |||||||
| 104 | The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended March 27, 2026 (formatted as Inline XBRL and contained in Exhibit 101). | |||||||
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† Filed herewith
* Portions of this exhibit (indicated by “[***]”) have been omitted as the registrant has determined that (i) the omitted information is not material and (ii) the omitted information is the type that the registrant treats as private or confidential.
# Management contract or compensatory plan or arrangement
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
JACOBS SOLUTIONS INC.
| By: | /s/ Venk Nathamuni | ||||
| Venk Nathamuni | |||||
Chief Financial Officer | |||||
| (Principal Financial Officer) | |||||
| Date: | May 5, 2026 | ||||
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FAQ
How did Jacobs Solutions (J) perform financially in its Q2 FY2026 quarter?
Jacobs reported Q2 FY2026 revenue of $3.69 billion, up from $2.91 billion a year earlier. However, higher costs led to a net loss attributable to Jacobs of $45.9 million, or $(0.34) per diluted share for the quarter.
What were Jacobs Solutions (J) results for the first six months of FY2026?
For the six months ended March 27, 2026, Jacobs generated $6.99 billion in revenue and net earnings attributable to Jacobs of $79.6 million. Diluted earnings per share were $0.79, reflecting profitable results over the half-year despite a second-quarter loss.
What is the PA Consulting Transaction described in Jacobs Solutions’ 10-Q?
Jacobs completed the PA Consulting Transaction on March 20, 2026, acquiring all remaining PA Consulting shares for about £1.21 billion. Consideration included £997.6 million in cash, 2,043,537 newly issued Jacobs shares, and an additional £75 million payable in 2028.
How much debt does Jacobs Solutions (J) have after funding the PA Consulting deal?
Long‑term debt increased to $4.08 billion as of March 27, 2026, up from $2.24 billion at September 26, 2025. The rise reflects new term loan facilities and $1.3 billion of bonds issued, partly to finance the PA Consulting Transaction.
What is Jacobs Solutions’ remaining performance obligations (backlog) at Q2 FY2026?
Jacobs reported approximately $19.0 billion in remaining performance obligations as of March 27, 2026. The company expects about 47% of this backlog to convert to revenue within twelve months, with the balance recognized mainly over the following four years.
What share repurchases and dividends did Jacobs Solutions (J) report?
Under its 2025 Repurchase Authorization, Jacobs repurchased and retired 3,389,433 shares during fiscal 2026 to date for $471.8 million at an average price of $139.21. The board also declared a quarterly dividend of $0.36 per share payable June 19, 2026.
How is Jacobs Solutions’ cash flow trending in the first half of FY2026?
For the six months ended March 27, 2026, Jacobs reported net cash used in operating activities of $103.4 million. After investing and financing activities, cash and cash equivalents, including restricted cash, increased to $1.49 billion at period end.