JACOBS SOLUTIONS INC.

Jacobs Solutions Inc. is a leading global professional services company that designs and deploys technology-centric solutions to solve complex challenges across advanced manufacturing, cities & places, energy, environmental, life sciences, transportation and water. The company operates in more than 40 countries and provides end-to-end capabilities spanning advisory and consulting, feasibility and planning, design, program delivery and lifecycle management.

The company competes with many firms including AECOM, Tetra Tech, WSP, Arcadis, Bechtel, Arup, Endava, Exponent, Mott MacDonald, Stantec, Parsons, Accenture, Mace, AtkinsRealis, Altair, Montrose, Capgemini, Fluor, Deloitte, KPMG, PwC, Bain & Company and McKinsey & Company. Jacobs competes based on technical capabilities, reputation for quality, price of services, safety record, availability of qualified personnel, and ability to timely perform work and contract terms.

Jacobs generates revenue primarily through professional services contracts, which fall into two broad categories: cost-reimbursable and fixed-price. For fiscal 2025, approximately 68% ¹ of revenues were from cost-reimbursable contracts and 32% ² from fixed-price contracts. The company serves national, state and local government clients across multiple regions including the U.S., Europe, U.K., Middle East, and Asia Pacific, as well as multinational and local private sector organizations globally.

The company operates through two reportable segments: Infrastructure & Advanced Facilities (I&AF) and PA Consulting. I&AF provides end-to-end solutions for clients' most complex challenges related to energy security, environmental resilience, safe and reliable transportation, buildings and infrastructure, integrated water management and biopharmaceutical manufacturing. I&AF's core skills revolve around consulting, planning, architecture, design, engineering, infrastructure delivery services including project, program and construction management and long-term operation of facilities. For fiscal 2025, I&AF revenues were $10,764,206,000 ³ and segment operating profit was $903,548,000 ⁴.

PA Consulting is a global innovation and transformation consultancy that accelerates new growth ideas from concept through design and development to commercial success, and revitalizes organizations by building leadership, culture, systems and processes. PA Consulting's global team of about 4,000 ⁵ includes strategists, innovators, designers, consultants, digital experts, scientists, engineers and technologists working across seven sectors: consumer and manufacturing, defense and security, energy and utilities, financial services, government, health and life sciences, and transport. For fiscal 2025, PA Consulting revenues were $1,265,577,000 ⁶ and segment operating profit was $278,499,000 ⁷.

On September 27, 2024, Jacobs completed the Separation Transaction, spinning off its Critical Mission Solutions and Cyber & Intelligence businesses to Amentum Holdings, Inc. by distributing 124,084,108 ⁸ shares of SpinCo common stock. During fiscal 2025, the Company repurchased $754.1 million ⁹ in shares. The Company paid dividends of $0.29 ¹⁰ per share in the first quarter and $0.32 ¹¹ per share in the second, third and fourth quarters. On March 27, 2025, the Company entered into the 2025 Term Loan Facility, borrowing a $200.0 million ¹² term loan and £410.0 million ¹³ term loan. On March 13, 2025, the Company executed an Equity-for-Debt Transaction, exchanging shares of its investment in Amentum Holdings, Inc. for a principal amount of term loans under the 2021 Term Loan Facility, which were immediately extinguished, resulting in a loss on extinguishment of debt of $20.5 million ¹⁴.

For fiscal 2025, total revenues from continuing operations were $12,029,783,000 ¹⁵, an increase of 4.6% from $11,500,941,000 ¹⁶ in fiscal 2024. Gross profit was $2,984,934,000 ¹⁷, up 5.4% from $2,832,756,000 ¹⁸ in the prior year. Net earnings attributable to Jacobs from continuing operations were $313,302,000 ¹⁹, or $2.58 ²⁰ per diluted share, compared to $612,804,000 ²¹, or $4.79 ²² per diluted share in fiscal 2024. Net cash provided by operating activities was $686,704,000 ²³.

Management's multi-year growth strategy, 'Challenge Accepted,' launched in February 2025, is designed to sharpen focus and accelerate performance, positioning the company to drive profitable growth and deliver scalable, full lifecycle solutions across water and environmental, life sciences and advanced manufacturing, and critical infrastructure. The restructuring initiatives relating to the Separation Transaction, which are expected to be substantially completed before the end of calendar year 2025, are expected to result in estimated gross annualized pre-tax cash savings of approximately $165 million to $200 million ²⁴. Additionally, the restructuring initiatives for PA Consulting, which are substantially completed, are expected to result in estimated gross annualized pre-tax cash savings of approximately $50 million to $65 million ²⁵.

The company is focused on growing its presence in addressable markets by expanding relationships with existing clients, developing new clients, further developing existing capabilities and service offerings, creating new capabilities and solutions offerings, and undertaking business development efforts. The company is integrating artificial intelligence, machine learning, data science and similar technologies to improve operational efficiency, enhance service delivery, and support data-driven decision-making across core markets. In fiscal 2025, the company launched Jacobs AI Assist, its proprietary AI tool, and Jacobs University, its global learning and development hub with access to nearly 30,000 ²⁶ training programs.

The restructuring initiatives relating to the Separation Transaction are expected to result in estimated gross annualized pre-tax cash savings of approximately $165 million to $200 million ²⁷. The restructuring initiatives for PA Consulting are expected to result in estimated gross annualized pre-tax cash savings of approximately $50 million to $65 million ²⁸. The company will likely incur additional charges under the Separation Transaction restructuring program through calendar year 2025, which are expected to result in additional savings in future periods.

As of September 26, 2025, the company had a workforce of approximately 43,000 ²⁹ people worldwide, including a contingent workforce of approximately 1,800 ³⁰ people. The voluntary employee turnover rate was 8.2% ³¹. The company's global Hybrid Work model strengthens team collaboration and client connection while offering flexibility. The company continues to evaluate its real estate needs in connection with changes in the Company's use of leased space and as part of its overall strategic organizational changes.

During fiscal 2025, the Company repurchased $754.1 million ³² in shares. On January 30, 2025, the Company's Board of Directors authorized an incremental share repurchase program of up to $1.5 billion ³³ of the Company's common stock, to expire on January 30, 2028. At September 26, 2025, the Company had $1.22 billion ³⁴ remaining under the 2025 Repurchase Authorization. The Company paid dividends of $0.29 ³⁵ per share in the first quarter and $0.32 ³⁶ per share in the second, third and fourth quarters. As of September 26, 2025, there was approximately $142.1 million ³⁷ of total unrecognized compensation cost related to PA Consulting equity-based incentive grants.

The company faces headwinds from uncertain global economic, socioeconomic and political conditions that may negatively impact clients' ability and willingness to fund projects. Continuing inflation and high interest rates and/or construction costs could reduce demand for services and decrease profit on existing contracts, particularly fixed-price contracts. The company also faces risks from international trade issues, including tariffs and counter tariffs, which may have a negative impact on business. A reduction in government investment in markets in which the company operates could materially affect results of operations.

The company's international operations, which accounted for approximately 38% ³⁸ of revenue in fiscal 2025, are exposed to additional risks including unfavorable political developments, weak foreign economies, foreign exchange risks, and potential non-compliance with a wide variety of laws and regulations. The company is subject to risks associated with changes in laws, regulations and policies including environmental and employment requirements, export/import laws, tax policies, and integrated financial/non-financial reporting requirements such as the Corporate Sustainability Reporting Directive and the Corporate Sustainability Due Diligence Directive in the European Union.

The company's results of operations depend on the award of new contracts and the timing of these awards, and demand for services is impacted by economic downturns, reductions in private or government spending, and times of political uncertainty. Approximately 32% ³⁹ of fiscal 2025 revenues were earned under fixed-price contracts, which subject the company to risks of cost overruns if costs increase above budgets or estimates. The U.S. federal government represented approximately 8% ⁴⁰ of total revenue in fiscal 2025, and contracts with or funded by the U.S. government are subject to additional risks including annual funding appropriations, audits, investigations, and potential termination. The company had $4.78 billion ⁴¹ of goodwill as of September 26, 2025, representing 42.5% ⁴² of total assets of $11.3 billion ⁴³, and an impairment charge could have a material adverse impact. The company may not achieve some or all of the expected benefits of the Separation Transaction, and could incur a significant tax liability if the terms of the IRS private letter ruling are not satisfied, as a 50% or greater interest acquisition of Jacobs or Amentum stock within two years before or after the distribution could result in a tax liability.

Management's message emphasizes the company's transformation into a science-based consulting and advisory leader, focused on delivering digitally enabled, resilient solutions. The 'Challenge Accepted' multi-year growth strategy launched in February 2025 is designed to sharpen focus and accelerate performance. Management highlights the successful completion of the Separation Transaction on September 27, 2024, which created two independent, publicly traded companies. Key strategic priorities include driving profitable growth, delivering scalable full lifecycle solutions across water and environmental, life sciences and advanced manufacturing, and critical infrastructure, and continuing to invest in artificial intelligence and next-generation digital solutions. Management states that new prospects and new sales remain strong, and the company continues to have a positive outlook for many of the industry groups and sectors in which its clients operate.