DALLAS — Jacobs executives said demand for artificial intelligence infrastructure continued to drive major growth across the company’s operations during its fiscal second quarter, with data center-related business more than doubling year over year.
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Company leaders highlighted strong momentum in data centers, semiconductors, water, energy and power markets during a Tuesday earnings call, pointing to sustained infrastructure investment tied to the rapid expansion of AI technologies.
“We see very strong runway to build on that success in the second half of the year,” said Bob Pragada, CEO of Jacobs. “The investment cycle is still in the early stages.”
Pragada said AI infrastructure development has become a significant growth engine for the Dallas-based professional services and construction firm. According to the company, its data center business grew by more than 100% during the quarter as hyperscale technology companies increased spending on construction and advisory services.
“AI is absolutely driving our business,” said Pragada. “We’re seriously at an inflection point, and it’s accelerating our entire business.”
The company said data centers currently account for approximately 3% to 4% of Jacobs’ overall business portfolio, while the broader AI infrastructure ecosystem represents about 10% of total operations. That portion of the company’s business is growing at more than 40%, according to Pragada.
“You’re talking about a significant part of our business that’s growing at a very fast rate,” he said. “All centered around the AI infrastructure build.”
Executives said growing AI infrastructure needs are also fueling expansion in related sectors, including semiconductors, utilities and energy systems that support large-scale computing facilities.
“We’re seeing rising demand in semiconductors, water and energy and power as the technology and infrastructure go hand in hand,” said Pragada. “This is bolstering total revenue growth.”
The company noted that supporting infrastructure projects tied to data center construction remain in high demand as developers race to meet computing and cloud capacity requirements.
Jacobs also raised its full-year outlook for the second consecutive quarter, citing strong operational performance and continued project bookings.
“We’re tracking very well heading into the second half of the fiscal year with strong Q2 performance enabling us to increase our full-year outlook for the second consecutive quarter,” said Pragada. “We’re seeing momentum in our growth rate, margin and bookings trajectory, all of which give us confidence in our outlook.”
Despite strong operational growth, Jacobs reported a net loss of $45.88 million during the fiscal second quarter, compared to a profit of $5.61 million during the same period last year. The company attributed the loss primarily to finalizing its acquisition of the remaining stake in PA Consulting.
Quarterly revenue rose to $3.69 billion, marking a 27% increase from $2.91 billion a year earlier. The company’s backlog also climbed significantly, reaching $26.97 billion, up 21.7% from $22.16 billion in the prior year.
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Industry analysts said the company’s results exceeded expectations due largely to continued strength in infrastructure and advanced buildings work linked to AI-related development.
“Results topped expectations on both revenue and margins,” wrote Andrew Wittmann, senior research analyst with Baird, in a research note. “Ultimately, its infrastructure and advanced buildings businesses are benefiting from strong demand, much of which is along the AI value chain with rapid growth from a prior very small base.”
As investment in artificial intelligence infrastructure continues to accelerate globally, Jacobs executives indicated the company expects sustained demand for data center construction and associated infrastructure projects well into the future.
Originally reported by Sebastian Obando, Senior Reporter in Construction Dive.
