Stantec (NYSE:STN) executives struck an upbeat tone on the company’s fourth-quarter and full-year 2025 earnings call, highlighting record annual results, margin expansion that reached strategic targets early, and a growing backlog that management said supports expectations for another strong year in 2026.
Record 2025 performance driven by organic growth and acquisitions
President and CEO Gord Johnston said 2025 was “another record year,” with “solid mid-single-digit organic growth” and three acquisitions completed despite geopolitical uncertainty. He pointed to demand across water, mission-critical facilities, transportation, and the energy transition as key tailwinds.
Executive Vice President and CFO Vito Culmone added that full-year gross revenue reached $8.1 billion, while adjusted profitability improved significantly. Adjusted EBITDA rose nearly 17% year over year, and the adjusted EBITDA margin reached 17.9% for 2025. Johnston said Stantec achieved its 2024–2026 strategic plan adjusted EBITDA margin target range of 17%–18% “one full year earlier than originally anticipated.”
Adjusted EPS for 2025 was CAD 5.30, up 19.9% from 2024, according to Culmone.
Fourth-quarter results show continued margin improvement
In the fourth quarter, Stantec reported gross revenue of $2.1 billion and net revenue of $1.6 billion, representing 10.9% growth versus Q4 2024. Culmone said the quarter’s growth was driven by 3.9% organic growth and 6.5% acquisition growth.
Project margins were 54.5% of net revenue in Q4, “in line with expectations,” and adjusted EBITDA margin improved to 17.3%, up 60 basis points year over year. Culmone attributed the margin expansion mainly to lower admin and marketing expenses as a percentage of net revenue, driven by higher utilization and operational discipline. Adjusted EPS in the quarter increased 12.6% to $1.25.
Regional performance led by U.S. buildings growth and global water momentum
Johnston outlined performance across geographies:
- United States: Q4 net revenue increased 13.5%, driven primarily by 11.5% acquisition growth and “just over” 2% organic growth. For the full year, U.S. net revenue rose almost 11%, supported by just over 5% acquisition growth and 3.4% organic growth. Johnston said the buildings business grew net revenue by over 30% for the year, primarily due to the Page acquisition, alongside solid organic growth supported by data centers and other mission-critical facilities, science and technology, and civic work.
- Canada: Q4 net revenue increased 5.5%, driven entirely by organic growth. Full-year net revenue grew over 8% versus 2024, primarily organic. Johnston highlighted over 20% organic growth in water tied to major wastewater projects and 15% organic growth in energy and resources due to progress on industrial process projects, with infrastructure growth supported by land development in Alberta, airports in Quebec, and bridge work in Eastern Canada.
- Global: Q4 net revenue growth was 11%, including over 6% organic growth and 2.5% acquisition growth, with a positive foreign exchange impact also contributing. For the full year, global net revenue increased almost 13%, driven by nearly 6% organic growth and over 4% acquisition growth. Johnston cited continued double-digit organic growth in the global water business through framework agreements and public-sector investment across the UK, Australia, and New Zealand, as well as growth in South American mining tied to copper demand for the energy transition and double-digit organic growth in German infrastructure linked to electrical transmission and transit and rail projects.
Backlog reaches new high; dividend raised
Culmone said Stantec ended 2025 with a record CAD 8.6 billion contract backlog, up 9.5% year over year and representing approximately 13 months of work. He said acquisitions completed in 2025 contributed more than 8% to backlog growth, primarily within buildings, while organic backlog growth was 3.6%. Global backlog grew organically by 14.2%, and the company also cited backlog strength in water and in buildings supported by healthcare, data centers, and mission-critical facilities.
On capital returns, Culmone said Stantec’s board approved an 8.9% dividend increase, raising the annualized dividend to CAD 0.98 per share.
2026 outlook: higher net revenue and continued margin expansion
Management issued 2026 targets calling for net revenue growth of 8.5% to 11.5%, driven by organic growth and acquisition contributions “primarily due to the Page acquisition.” The company expects adjusted EBITDA margin of 17.6% to 18.2% and adjusted EPS growth of 15% to 18% versus 2025. Culmone said the guidance does not assume any additional acquisitions due to the unpredictability of timing and size.
Johnston said macro trends such as aging infrastructure, water security, advanced manufacturing, defense spending, demand for mission-critical facilities, and the energy transition are creating opportunities, and noted the company has seen “an increase in activity in the U.S.” in recent months. He pointed to continued data center demand, including a selection to design an initial 300–350 megawatt phase of a large campus that could scale to 1 gigawatt, as well as rising activity in environmental services tied to the U.S. Navy CLEAN program and accelerating U.S. Department of Defense work. He also cited ongoing U.S. infrastructure momentum, noting that roughly half of IIJA funding remained to be allocated.
In Canada, Johnston highlighted defense-related opportunities, particularly in the Arctic, citing involvement in projects such as Grays Bay Road and work supporting the North American Aerospace Defense Command, upgrades for the Canadian Armed Forces, and a major design-build contract for Defence Construction Canada tied to a multi-mission aircraft hangar. In the global region, he emphasized UK water opportunities under AMP8 and said Stantec was named a preferred bidder for the “multi-billion pound” Scottish Water enterprise program, which management said could extend 13 years.
Executives also discussed how AI is being embedded into delivery workflows to improve efficiency and quality control, while keeping pricing “anchored in value and risk reduction.” In Q&A, Johnston characterized AI as the latest in a series of productivity-enhancing tools that can support higher net revenue per employee over time.
On M&A, management said acquisitions remain a fundamental growth driver but must be value accretive. Executives acknowledged public-market multiple declines may take time to flow into private-market valuation expectations. Culmone also said the company would be “more actively looking at buybacks” with respect to current valuation, while reiterating that M&A remains a first priority and noting Stantec expects to renew its normal course issuer bid.
About Stantec (NYSE:STN)
Stantec is a global design and consulting firm offering professional services in engineering, architecture, and environmental sciences. The company partners with public and private clients to deliver solutions spanning infrastructure, water, energy and resources, and community development. Through an integrated approach, Stantec manages projects from initial planning and conceptual design through construction and commissioning, focusing on sustainability and innovation.
The firm’s service portfolio includes civil infrastructure design, building systems engineering, environmental assessments, and project management.
