[Management View]
Dycom Industries reported a strong start to FY2026, with total contract revenue reaching $1.259 billion, a 10.2% increase over Q1 FY2025. Adjusted EBITDA was $150.4 million, up 14.9% year over year. The company emphasized its strategic focus on diversifying its customer base and service offerings, which has resulted in a record backlog of $8.127 billion.

[Outlook]
The company raised its full-year revenue guidance to $5.29 billion to $5.425 billion, reflecting 12.5%-15.4% growth. Q2 guidance includes expected revenues of $1.38 billion to $1.43 billion, with adjusted EBITDA of $185 million to $200 million. Dycom anticipates continued growth in fiber, data center connectivity, and wireless segments.

[Financial Performance]
Year-over-year, Dycom's revenue increased by 10.2%, and adjusted EBITDA grew by 14.9%. The company exceeded expectations across all key metrics, including net income of $61 million and diluted EPS of $2.09. The backlog increased to $8.127 billion, with $4.685 billion expected to be executed within the next twelve months.

[Q&A Highlights]
Question 1: Alex Waters from B of A inquired about the performance of Blackwood Beach and the size of the maintenance business.
Answer: Daniel Peyovich explained that Blackwood Beach's wireless acquisition ramped quicker than expected, contributing significantly to the quarter's success. The maintenance business, historically over 50% of Dycom's operations, provides recurring revenue through long-term contracts.

Question 2: Richard Choe from JPMorgan asked about the continuation of strength in Q2 guidance and potential CapEx adjustments due to tariffs.
Answer: Peyovich noted that fiber to home builds and wireless business integration are key contributors to Q2 outlook. He assured that tariff impacts are manageable and that strategic equipment procurement ensures growth is not impeded.

Question 3: Steven Fisher from UBS questioned the cost dynamics and margin improvements.
Answer: Drew DeFerrari highlighted operating leverage as a primary factor for margin growth, with ongoing efforts in efficiency and quality improvements. BEAD program contributions are not included in current growth projections.

Question 4: Frank Louthan from Raymond James asked about backlog trends and organic growth.
Answer: Peyovich emphasized the diversification of the backlog and noted slight positive organic growth, with expectations for continued improvement.

Question 5: Sangita Jain from KeyBanc Capital Markets inquired about the guidance raise and capital intensity.
Answer: Peyovich confirmed the inclusion of an extra week in the guidance and expressed confidence in achieving growth targets. He noted that expanded operations and maintenance business could enhance free cash flow over time.

Question 6: Adam Thalhimer from Thompson Davis asked about new awards for middle mile and inside the fence work.
Answer: Peyovich detailed new opportunities in data center connectivity, with work expected to commence this year, though not yet included in the backlog.

Question 7: Gene Valiz from D. A. Davidson questioned the impact of customer consolidation.
Answer: Peyovich stated that consolidation typically benefits Dycom, as larger customers prefer national players capable of handling extensive operations.

Question 8: Laura Mayer from B. Riley Securities asked about government layoffs and deregulation impacts.
Answer: Peyovich acknowledged the fluidity of regulatory changes and potential positives like eased permitting and bonus depreciation, which could boost customer spending.

[Sentiment Analysis]
The tone of the call was optimistic, with management confident in their strategic direction and growth prospects. Analysts' questions focused on understanding the drivers of growth and potential risks, reflecting a positive outlook on Dycom's performance.

[Quarterly Comparison]
| Metric | Q1 FY2026 | Q1 FY2025 | YoY Change |
|-------------------------|-----------|-----------|------------|
| Total Contract Revenue | $1.259B | - | +10.2% |
| Adjusted EBITDA | $150.4M | - | +14.9% |
| Net Income | $61M | - | - |
| Diluted EPS | $2.09 | - | - |
| Backlog | $8.127B | - | - |

[Risks and Concerns]
Potential risks include tariff impacts on equipment costs, though management considers these manageable. The BEAD program's uncertain timeline could affect future revenue projections, but current growth does not rely on it.

[Final Takeaway]
Dycom Industries demonstrated robust performance in Q1 FY2026, driven by strategic diversification and strong execution across key growth areas. The company's increased revenue guidance reflects confidence in its ability to capitalize on industry opportunities, despite macroeconomic uncertainties. With a record backlog and ongoing investments in service and maintenance, Dycom is well-positioned for sustained growth. Management's proactive approach to managing tariffs and regulatory changes further supports their optimistic outlook.