Parsons Reports Third Quarter 2025 Results

Q3 2025 Financial Highlights 

• Q3 revenue of $1.6 billion decreased 10% year-over-year and 14% on an organic basis
• Revenue growth of 14% excluding confidential contract; 9% on an organic basis
• Q3 net income of $64 million decreased $8 million year-over-year
• Q3 adjusted EBITDA decreased 5% to $158 million; adjusted EBITDA margin of 9.8% increased 60 basis points
• Book-to-bill ratio of 1.0x and continued streak of TTM book-to-bill ratio of 1.0x or greater in every quarter since IPO
• Total backlog increased to $8.8 billion; 72% is funded, highest level since IPO
• Modifying fiscal year 2025 revenue and reiterating adjusted EBITDA and cash flow guidance ranges at mid-point
  

CHANTILLY, Va., Nov. 05, 2025 (GLOBE NEWSWIRE) -- Parsons Corporation (NYSE: PSN) today announced financial results for the third quarter ended September 30, 2025.

CEO Commentary

“We are pleased with our third quarter results. We delivered double-digit revenue growth, achieved 60 basis points of margin expansion, exceeded our cash flow expectation, secured defense contracts in the Administration's priority areas, and continued to deliver outstanding results in our Critical Infrastructure segment. In addition, our win rates and hiring and retention remain strong, and we completed another accretive acquisition after the quarter ended,” said Carey Smith, chair, president and chief executive officer.

"Given our healthy forward-looking financial metrics, team's strong execution, recent large contract wins, and the tailwinds we have in both segments, we remain optimistic that we will continue to deliver industry leading organic growth rates and drive long-term shareholder value.”

Third Quarter 2025 Results

Year-over-Year Comparisons (Q3 2025 vs. Q3 2024)

Total revenue for the third quarter of 2025 decreased by $188 million, or 10%, to $1.6 billion and was down 14% on an organic basis. Excluding the company's confidential contract, total revenue growth was 14% and organic revenue growth was 9% driven by growth in our Critical Infrastructure Protection, Transportation, Urban Development, and Space and Missile Defense markets. Operating income decreased 6% to $108 million primarily due to a decrease in revenue on the company's confidential contract and increased investments in bid and proposal activity and critical hires in support of our strong pipeline and large strategic pursuits aligned to the Administration's priorities. Net income decreased 11% to $64 million due to the items noted above. GAAP diluted earnings per share (EPS) attributable to Parsons was $0.59 in the third quarter of 2025, compared to $0.65 in the prior year period.

Adjusted EBITDA including noncontrolling interests for the third quarter of 2025 was $158 million, a 5% decrease over the prior year period. Adjusted EBITDA margin expanded 60 basis points to 9.8% compared to 9.2% in the third quarter of 2024. The adjusted EBITDA margin increase was driven by improved program performance and accretive acquisitions. Diluted adjusted diluted EPS was $0.86 in the third quarter of 2025, compared to $0.95 in the third quarter of 2024. The year-over-year adjusted diluted EPS decrease was driven by the items that impacted operating income noted above.

Segment Results 

Critical Infrastructure Segment

Critical Infrastructure Year-over-Year Comparisons (Q3 2025 vs. Q3 2024)

Third quarter 2025 Critical Infrastructure revenue increased $129 million, or 18%, from the third quarter of 2024. This increase was driven by organic growth of 13% and inorganic revenue contributions from the company's BCC and TRS acquisitions. Organic growth was primarily driven by the ramp-up of recent contract wins and growth on existing contracts in both North America and the Middle East.  

Third quarter 2025 adjusted EBITDA including noncontrolling interests increased by $39 million, or 83%, compared to the prior year period. Adjusted EBITDA margin increased 360 basis points to 10.3% from 6.7% in the prior year period. These increases were driven primarily by improved program performance, the ramp-up of recent awards, and our accretive BCC acquisition.

Federal Solutions Segment

Federal Solutions Year-over-Year Comparisons (Q3 2025 vs. Q3 2024)

Third quarter 2025 revenue decreased $317 million, or 29%, compared to the prior year period and 31% on an organic basis. Excluding the company's confidential contract, Federal Solutions' revenue increased 9%, and 5% on an organic basis. These increases were driven by growth in our Critical Infrastructure Protection, Transportation, and Space and Missile Defense markets.

Third quarter 2025 Federal Solutions adjusted EBITDA including noncontrolling interests decreased by $48 million, or 40% from the third quarter of 2024, and adjusted EBITDA margin decreased 170 basis points to 9.2% driven primarily by lower volume on the company's fixed price confidential contract and investments made in bid and proposal activity and key personnel on strategic pursuits. 

Third Quarter 2025 Key Performance Indicators

• Book-to-bill ratio: 1.0x on net bookings of $1.6 billion.
• Book-to-bill ratio (trailing twelve-months): 1.0x on net bookings of $6.5 billion.
• Total backlog: $8.8 billion, up $48 million from Q3 2024. Funded backlog of $6.4 billion is at its highest level since the company's 2019 IPO, and represents 72% of total backlog.
• Cash flow from operating activities: Third quarter 2025: $163 million compared to $299 million in third quarter of 2024. For the nine months ended September 30, 2025: $311 million compared to $397 million in the prior year period.

Significant Contract Wins

Parsons continues to win new business across both segments. During the third quarter of 2025, the company won four contracts worth more than $100 million each.

• Awarded a new large ten-year single-award task order contract as exclusive sub-contractor to provide design and modernization support for the Holston Army Ammunition Plant Government-Owned Contractor-Operated Production & Modernization contract. This win continues our success of winning industrial base upgrades as part of the $18 billion modernization plan.
• Received an additional six-year, $133 million authorization to continue serving as the lead designer for the Georgia State Route 400 Express Lanes. This project will add new express lanes and use state-of-the-art traffic, incident management, and digital twin systems. The company booked the full amount on this contract during the third quarter. As a Tier 1 focus state for Parsons, this expands our Georgia Department of Transportation presence, with the state of Georgia expected to spend more than $20 billion over the next five years.
• Awarded two new multi-year single-award defense and security contracts for two Middle Eastern government customers, including a contract valued at over $100 million. These contracts represent new work to lead the design review and project and construction management of regional national security infrastructure programs. Additionally, the company will design border security infrastructure and facilities across critical border regions. These contracts reflect Parsons’ ability to bring its comprehensive national security, critical infrastructure protection, and program management capabilities and expertise to bear on the success of its regional customer base in the Middle East. The company booked over $100 million of these contracts during the third quarter.
• MPA Delivery Partners, a joint venture of three companies including Parsons, was awarded a $665 million, 4.5-year contract extension by the Gateway Development Commission to continue managing the successful delivery of the Hudson Tunnel Project. The project will build a new two-tube rail tunnel under the Hudson River and rehabilitate the existing 115-year old tunnel as well as nine miles of new passenger rail track between New York and New Jersey.
• Awarded an $88 million task order under the Air Base, Air Defense contract. Parsons will provide integration, upgrades, procurement, and training across the Europe and Africa areas of responsibility for the U.S. Air Force.  This contract includes a one-year base period and two one-year option periods, and we booked $82 million this quarter.  For the first nine months of 2025, we’ve been awarded over $190 million in task orders on this IDIQ vehicle.
• Awarded three contracts in the PFAS market with a total value of $23 million during the third quarter. These wins span the company's Federal Solutions and Critical Infrastructure businesses and expand its portfolio in the strategic and rapidly growing PFAS market. The company booked $16 million on these contracts during the third quarter. Year-to-date, the company has won nearly $70 million in PFAS contact awards and PFAS represents a $40 billion addressable market for Parsons. These wins represent revenue synergies with the company's TRS Group acquisition.
• During the third quarter, Parsons was awarded prime positions on four multiple-award IDIQ contracts by federal customers, with a combined ceiling value of $43.5 billion. Under these contracts, Parsons will compete for task orders to support efforts to mitigate threats from weapons of mass destruction for the Defense Threat Reduction Agency, deliver comprehensive logistics solutions to the U.S. Navy, and provide construction support services for Naval and Air Force facilities located in the Indo-Pacific region and worldwide. Additionally, the company was awarded a prime position on the Washington Sound Transit multiple-award IDIQ contract by Sound Transit with a value of $1 billion. Under this contract, the company will compete for task orders to provide architecture and engineering services to support rail and transit capital projects.
  

Additional Corporate Highlights

Parsons continues its successful track record of acquiring strategic companies in high-growth markets that strengthens its portfolio. During the quarter, the company was recognized as one of the World’s Best Companies by TIME and Statista, one of the Best-Led Companies by Glassdoor, and received an award from ACEC New York for the company’s work on the Brooklyn Bridge Rehabilitation Project.

• After the third quarter of 2025 ended, Parsons announced and closed its acquisition of Applied Sciences Consulting, Inc., a Florida-based engineering firm that specializes in water and stormwater solutions for cities, counties, and water management districts across the state. The acquisition expands Parsons’ water expertise, strengthens its presence in Florida, and is consistent with the company’s strategy of completing accretive acquisitions with revenue growth and adjusted EBITDA margins of at least 10%.
• Recognized by TIME and Statista as one of the World’s Best Companies in 2025. The World’s Best Companies 2025 ranking is a comprehensive analysis conducted to identify the top-performing companies across the globe and were identified based on employee satisfaction, revenue growth, and sustainability.
• Honored by Glassdoor as one of the Best-Led Companies in 2025, based on employee reviews and ratings from the previous year. Ranked #27, Parsons is the highest-ranked company among national security and critical infrastructure firms and the only member of its peer group to be included on the list.
• Honored with the prestigious Diamond Award in the Structural Systems category from the American Council of Engineering Companies (ACEC) of New York for the company’s work on the Brooklyn Bridge Rehabilitation Project. This award places the Brooklyn Bridge Rehabilitation among North America’s most distinguished infrastructure projects.
  

Fiscal Year 2025 Guidance

The company is modifying its fiscal year 2025 revenue outlook and reiterating its adjusted EBITDA and operating cash flow guidance ranges at the mid-point. The table below summarizes the company’s fiscal year 2025 guidance.

Net income guidance is not presented as the company believes volatility associated with interest, taxes, depreciation, amortization and other matters affecting net income, including but not limited to one-time and nonrecurring events and impact of M&A, will preclude the company from providing accurate net income guidance for fiscal year 2025.

Conference Call Information

Parsons will host a conference call today, November 5, 2025, at 8:00 a.m. ET to discuss the financial results for its third quarter 2025.

Access to a webcast of the live conference call can be obtained through the Investor Relations section of the company's website (https://investors.parsons.com). Those parties interested in participating via telephone may register on the Investor Relations website or by clicking here.

A replay will be available on the company's website approximately two hours after the conference call and continuing for one year.

About Parsons Corporation

Parsons (NYSE: PSN) is a leading disruptive technology provider in the national security and global infrastructure markets, with capabilities across cyber and electronic warfare, space and missile defense, transportation, water and environment, urban development, and critical infrastructure protection. Please visit Parsons.com and follow us on LinkedIn and Facebook to learn how we’re making an impact.

Forward-Looking Statements

This Earnings Release and materials included therewith contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are based on our current expectations, beliefs, and assumptions, and are not guarantees of future performance. Forward-looking statements are inherently subject to uncertainties, risks, changes in circumstances, trends and factors that are difficult to predict, many of which are outside of our control. Accordingly, actual performance, results and events may vary materially from those indicated in the forward-looking statements, and you should not rely on the forward-looking statements as predictions of future performance, results or events. Numerous factors could cause actual future performance, results and events to differ materially from those indicated in the forward-looking statements, including, among others: the impact of COVID-19; any issue that compromises our relationships with the U.S. federal government or its agencies or other state, local or foreign governments or agencies; any issues that damage our professional reputation; changes in governmental priorities that shift expenditures away from agencies or programs that we support; our dependence on long-term government contracts, which are subject to the government’s budgetary approval process; the size of addressable markets and the amount of government spending on private contractors; failure by us or our employees to obtain and maintain necessary security clearances or certifications; failure to comply with numerous laws and regulations; changes in government procurement, contract or other practices or the adoption by governments of new laws, rules, regulations and programs in a manner adverse to us; the termination or nonrenewal of our government contracts, particularly our contracts with the U.S. government; our ability to compete effectively in the competitive bidding process and delays, contract terminations or cancellations caused by competitors’ protests of major contract awards received by us; our ability to generate revenue under certain of our contracts; any inability to attract, train or retain employees with the requisite skills, experience and security clearances; the loss of members of senior management or failure to develop new leaders; misconduct or other improper activities from our employees or subcontractors; our ability to realize the full value of our backlog and the timing of our receipt of revenue under contracts included in backlog; changes in the mix of our contracts and our ability to accurately estimate or otherwise recover expenses, time and resources for our contracts; changes in estimates used in recognizing revenue; internal system or service failures and security breaches; and inherent uncertainties and potential adverse developments in legal proceedings including litigation, audits, reviews and investigations, which may result in material adverse judgments, settlements or other unfavorable outcomes. These factors are not exhaustive and additional factors could adversely affect our business and financial performance. For a discussion of additional factors that could materially adversely affect our business and financial performance, see the factors including under the caption “Risk Factors” in our Annual Report with the Securities and Exchange Commission pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the fiscal year ended December 31, 2024, on Form 10-K, filed on February 19, 2025, and our other filings with the Securities and Exchange Commission.

All forward-looking statements are based on currently available information and speak only as of the date on which they are made. We assume no obligation to update any forward-looking statements made in this presentation that becomes untrue because of subsequent events, new information or otherwise, except to the extent we are required to do so in connection with our ongoing requirements under federal securities laws.

PARSONS CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
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Net income available to shareholders used to compute diluted EPS as a result of adopting the if-converted method in connection with the Convertible Senior Notes
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PARSONS CORPORATION
CONSOLIDATED BALANCE SHEETS
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Book-To-Bill Ratio¹:

Non-GAAP Financial Information
The tables under "Parsons Corporation Inc. Reconciliation of Non-GAAP Measures" present Adjusted Net Income attributable to Parsons Corporation, Adjusted Earnings per Share, Earnings before Interest, Taxes, Depreciation, and Amortization (“EBITDA”), Adjusted EBITDA, EBITDA Margin, and Adjusted EBITDA Margin, reconciled to their most directly comparable GAAP measure. These financial measures are calculated and presented on the basis of methodologies other than in accordance with U.S. generally accepted accounting principles ("Non-GAAP Measures"). Parsons has provided these Non-GAAP Measures to adjust for, among other things, the impact of amortization expenses related to our acquisitions, costs associated with a loss or gain on the disposal or sale of property, plant and equipment, restructuring and related expenses, costs associated with mergers and acquisitions, software implementation costs, legal and settlement costs, and other costs considered non-operational in nature. These items have been Adjusted because they are not considered core to the company’s business or otherwise not considered operational or because these charges are non-cash or non-recurring. The company presents these Non-GAAP Measures because management believes that they are meaningful to understanding Parsons’s performance during the periods presented and the company’s ongoing business. Non-GAAP Measures are not prepared in accordance with GAAP and therefore are not necessarily comparable to similarly titled metrics or the financial results of other companies. These Non-GAAP Measures should be considered a supplement to, not a substitute for, or superior to, the corresponding financial measures calculated in accordance with GAAP.

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¹ Book-to-Bill ratio is calculated as total contract awards divided by total revenue for the period.

PARSONS CORPORATION
Non-GAAP Financial Information
Reconciliation of Net Income to Adjusted EBITDA
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PARSONS CORPORATION
Non-GAAP Financial Information
Computation of Adjusted EBITDA Attributable to Noncontrolling Interests
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PARSONS CORPORATION
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Reconciliation of Net Income Attributable to Parsons Corporation to Adjusted Net Income Attributable to Parsons Corporation
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