Granite Construction reported second-quarter 2026 revenue of $1.455 billion, up 29% from a year earlier, even as the company posted a $278 million net loss tied to a one-time debt transaction rather than any weakness in its underlying construction business. The Watsonville, Calif.-based infrastructure contractor disclosed the results in a July 30 SEC filing covering the quarter ended June 30.
The loss compares with net income of $72 million in the second quarter of 2025 and stemmed almost entirely from a $360 million non-operating loss Granite recorded on its 3.75% convertible notes. The company chose to settle the notes in cash rather than issuing new shares, a move that limited dilution for existing shareholders but produced a large accounting loss in the quarter. Excluding that charge, adjusted net income actually rose to $101 million from $86 million a year earlier.
Adjusted EBITDA, the profitability measure Granite highlights for its core operations, climbed 22% to $186 million from $152 million in the prior-year quarter. For the first six months of 2026, revenue reached $2.368 billion, up from $1.826 billion, while adjusted EBITDA rose to $244 million from $180 million.
Granite’s construction segment, which covers roads, bridges, rail and other infrastructure work, generated $1.207 billion in second-quarter revenue, a 28.8% increase. Its materials segment, which supplies aggregates and asphalt, contributed $248 million, up 31.7%.
“We continued to execute against our strategy and deliver on our long-term financial objectives during the quarter,” Granite President and CEO Kyle Larkin said in the release.
The company’s committed and awarded projects backlog, a forward-looking measure of contracted work, rose sequentially by $250 million to $7.4 billion, up $1.4 billion from a year ago. The backlog includes $624 million tied to U.S. Customs and Border Protection tactical infrastructure projects. Data centers are an increasingly visible piece of that pipeline: backlog tied to data-center clients β largely site preparation and paving work supporting the sector’s building boom β grew more than threefold, from $65 million a year ago to $223 million at the end of the second quarter.
Granite raised its full-year 2026 revenue guidance to a range of $5.3 billion to $5.5 billion, up from its prior forecast of $5.2 billion to $5.4 billion. The company also guided to an adjusted EBITDA margin of 12.25% to 13.25%, SG&A of 8.25% to 8.75% of revenue β which includes $48 million in stock-based compensation β and capital expenditures of $140 million to $160 million, including $50 million earmarked for strategic materials investments. Granite also raised its operating cash flow target to 11% of revenue from 10%.
Granite is one of the largest publicly traded heavy-civil contractors in the country, building and rehabilitating roads, bridges, rail lines, airports, marine ports, dams, reservoirs and aqueducts across the U.S. Its materials business, which mines and processes aggregates and produces asphalt, has become a larger share of the strategic investment picture as the company looks to control input costs for its own construction projects while also selling materials to third parties. The growing federal infrastructure and border-security workload, alongside private-sector data-center demand, gives Granite a backlog mix that spans both public and private construction spending cycles.
What it means
The large reported net loss is an accounting artifact of Granite’s debt refinancing decision, not a signal of deteriorating fundamentals β the company’s adjusted earnings, EBITDA and backlog all grew, and management raised guidance rather than cutting it. The tripling of data-center-related backlog is the more consequential data point for the construction sector broadly: it adds Granite to a lengthening list of contractors, from site-prep firms to EMCOR Group, which posted a record $17.14 billion backlog on surging data-center work, that are seeing AI-driven data-center construction become a durable growth driver alongside traditional infrastructure spending.
