News
May 15, 2025

Jacobs Eyes Growth Despite Tariffs and Profit Drop

Caroline Raffetto

Jacobs CEO Bob Pragada struck an optimistic tone during the company's second-quarter earnings call, saying the firm remains in a strong position to weather political transitions, global economic volatility, and evolving trade policies.

“Overall, our business remains well positioned, with infrastructure and consulting services in high demand and opportunities to capitalize on secular growth trends in front of us,” Pragada said.

The Dallas-based engineering and professional services firm has continued to lean into market trends driving demand for infrastructure upgrades and advanced facilities, a strategy Pragada emphasized had shown resilience during the first quarter. He doubled down on that outlook in Q2, despite uncertainty stemming from federal government transitions and fluctuating trade policy.

Jacobs’ exposure to federal work, including its projects with the Department of Defense, remains a key pillar of its operations. Pragada said recent government restructuring has had little impact on the firm’s pipeline so far.

“The impact related to the rollout of the Department of Government Efficiency, or DOGE, has so far been de minimis, and we continue to anticipate growth opportunities with the U.S. Department of Defense,” he said.

Roughly 9% of Jacobs’ overall revenue stems from U.S. federal infrastructure and related services tied to defense sector engagement, providing some insulation from private sector market shifts. That’s especially important as tariffs and trade tensions continue to disrupt global supply chains.

Addressing the uncertain tariff environment, Pragada said Jacobs’ strategic focus on advisory services and client support has helped turn a potential challenge into a growth opportunity.

“We remain focused on supporting our clients as they assess potential supply chain challenges. Our client-centric model built on redefining the asset life cycle will create opportunity to add value as our clients navigate this period of uncertainty,” he said.

While tariffs can result in cost increases and delays for capital projects, they have also created opportunities for Jacobs to provide scenario planning and advisory services, Pragada said.

“Just remember, a lot of these tariffs have not happened,” he said, referring to the back-and-forth nature of tariff implementation. By preparing clients for various outcomes, he added, Jacobs has “created a bit of some consulting and advisory work for us to be in the middle of this.”

Earnings snapshot

Despite Pragada’s upbeat assessment, Jacobs reported a significant drop in profits for the quarter. Net income fell to $11.2 million for the three-month period ending March 28, representing an 88% decrease compared to the same quarter in 2024.

However, revenue grew to $2.9 billion, a modest 2% increase year over year. The company also reported a 20% rise in backlog, signaling strong demand and a healthy pipeline of future work.

Jacobs CFO Venk Nathamuni said part of the decline in earnings was due to an interim legal setback involving a joint venture in which Jacobs holds a 50% stake.

Still, he emphasized that the company had managed to cushion the impact and expressed confidence in hitting annual targets. “We continue to maintain strong fundamentals and expect to meet our full-year financial goals,” Nathamuni said.

As Jacobs moves into the second half of its fiscal year, the company is banking on sustained demand for consulting, infrastructure modernization, and defense-related work to drive stability—and possibly growth—despite unpredictable macroeconomic conditions.

Originally reported by Zachary Phillips in Construction Dive.

News
May 15, 2025

Jacobs Eyes Growth Despite Tariffs and Profit Drop

Caroline Raffetto
Construction Industry
United States

Jacobs CEO Bob Pragada struck an optimistic tone during the company's second-quarter earnings call, saying the firm remains in a strong position to weather political transitions, global economic volatility, and evolving trade policies.

“Overall, our business remains well positioned, with infrastructure and consulting services in high demand and opportunities to capitalize on secular growth trends in front of us,” Pragada said.

The Dallas-based engineering and professional services firm has continued to lean into market trends driving demand for infrastructure upgrades and advanced facilities, a strategy Pragada emphasized had shown resilience during the first quarter. He doubled down on that outlook in Q2, despite uncertainty stemming from federal government transitions and fluctuating trade policy.

Jacobs’ exposure to federal work, including its projects with the Department of Defense, remains a key pillar of its operations. Pragada said recent government restructuring has had little impact on the firm’s pipeline so far.

“The impact related to the rollout of the Department of Government Efficiency, or DOGE, has so far been de minimis, and we continue to anticipate growth opportunities with the U.S. Department of Defense,” he said.

Roughly 9% of Jacobs’ overall revenue stems from U.S. federal infrastructure and related services tied to defense sector engagement, providing some insulation from private sector market shifts. That’s especially important as tariffs and trade tensions continue to disrupt global supply chains.

Addressing the uncertain tariff environment, Pragada said Jacobs’ strategic focus on advisory services and client support has helped turn a potential challenge into a growth opportunity.

“We remain focused on supporting our clients as they assess potential supply chain challenges. Our client-centric model built on redefining the asset life cycle will create opportunity to add value as our clients navigate this period of uncertainty,” he said.

While tariffs can result in cost increases and delays for capital projects, they have also created opportunities for Jacobs to provide scenario planning and advisory services, Pragada said.

“Just remember, a lot of these tariffs have not happened,” he said, referring to the back-and-forth nature of tariff implementation. By preparing clients for various outcomes, he added, Jacobs has “created a bit of some consulting and advisory work for us to be in the middle of this.”

Earnings snapshot

Despite Pragada’s upbeat assessment, Jacobs reported a significant drop in profits for the quarter. Net income fell to $11.2 million for the three-month period ending March 28, representing an 88% decrease compared to the same quarter in 2024.

However, revenue grew to $2.9 billion, a modest 2% increase year over year. The company also reported a 20% rise in backlog, signaling strong demand and a healthy pipeline of future work.

Jacobs CFO Venk Nathamuni said part of the decline in earnings was due to an interim legal setback involving a joint venture in which Jacobs holds a 50% stake.

Still, he emphasized that the company had managed to cushion the impact and expressed confidence in hitting annual targets. “We continue to maintain strong fundamentals and expect to meet our full-year financial goals,” Nathamuni said.

As Jacobs moves into the second half of its fiscal year, the company is banking on sustained demand for consulting, infrastructure modernization, and defense-related work to drive stability—and possibly growth—despite unpredictable macroeconomic conditions.

Originally reported by Zachary Phillips in Construction Dive.