Comfort Systems USA (NYSE:FIX) reported second-quarter 2026 revenue above $3 billion for the first time, as demand from technology and industrial customers helped drive higher bookings, record backlog and sharply improved profitability.
Chief Executive Officer Brian Lane said the company generated $3.3 billion in quarterly revenue and earned $12.53 per share, a 92% increase from the prior-year period. The company’s backlog reached a record $14.1 billion at quarter-end, supported by continued technology-sector demand and favorable project margins.
Revenue, Profit and Cash Flow Rise
Chief Financial Officer Bill George said second-quarter revenue increased by $1.1 billion from a year earlier, with same-store revenue up 44%. Electrical-segment revenue rose 81%, while mechanical-segment revenue increased 40%.
For the first six months of 2026, same-store revenue grew 47%. The company expects full-year same-store revenue growth to finish in the mid- to high-30% range, George said.
Gross profit increased to $844 million from $510 million in the second quarter of 2025, while gross margin expanded to 25.9% from 23.5%. Mechanical gross margin rose to 25.6% from 22.9%, and electrical gross margin increased to 26.4% from 25.3%.
SG&A expense increased to $287 million from $210 million as the company invested in personnel and innovation, though SG&A as a percentage of revenue declined to 8.8% from 9.7%. Operating income rose 86% to $558 million, and operating margin increased to 17.1% from 13.8%.
Net income was $442 million, or $12.53 per share, compared with $231 million, or $6.53 per share, a year earlier. EBITDA increased 80% to $600 million, bringing trailing 12-month EBITDA to approximately $2 billion.
Free cash flow totaled $999 million in the quarter. George attributed the result partly to advanced customer cash, strong payment terms and broad-based project performance, rather than a single factor. He said the company expects cash flow over time to align with net income plus noncash expenses.
The company ended the quarter with a net cash position of more than $1.8 billion, despite acquisition spending and capital investments. It expects capital expenditures for the full year to equal approximately 5% of revenue, primarily supporting production facilities and modular capacity.
Backlog Expands as Technology Work Drives Demand
President Trent McKenna said backlog increased by $1.6 billion sequentially, including a $1.4 billion same-store increase. Compared with a year earlier, total backlog increased $5.9 billion, or 73%, with $5.6 billion of the gain coming from same-store operations.
Same-store backlog entering the third quarter was 69% higher than a year earlier. McKenna said project pipelines remained at historically high levels, led by technology-sector construction and modular work.
- Industrial customers accounted for 75% of first-half revenue.
- Technology, which is included within industrial, represented 58% of revenue, up from 40% in the prior year.
- Institutional markets, including education, healthcare and government, represented 17% of revenue.
- Commercial markets accounted for 8% of revenue.
- Construction represented 90% of revenue, while service represented 10%.
New-building construction accounted for 75% of total revenue, including modular activity, while existing-building construction represented 15%. Modular revenue represented 17% of year-to-date revenue.
During the quarter, modular operations booked $510 million, enough to cover the business’s production activity and add roughly $500 million to backlog, according to George. The company said demand from customers remains consistent with its plans to expand modular manufacturing capacity.
Modular Capacity Plans Tied to Customer Commitments
Comfort Systems USA has more than 3.5 million square feet of capacity dedicated to modular operations and expects to exceed 4 million square feet in production by year-end. It plans to reach approximately 5 million square feet of capacity by late summer 2027.
Management said the planned capacity expansion is principally intended to serve existing customers and existing orders. The company is pursuing pilot contracts with frontier labs and colocation providers, but said meaningful programmatic business from those newer customers would require additional manufacturing space.
George said the company will not add buildings solely on speculation and will expand only when customers provide meaningful multiyear commitments. He said recent capital investments have generated rapid returns, with projects producing what he described as full paybacks within one or two years.
Management said it does not see a slowdown in data-center demand despite public opposition and moratorium discussions in some markets. Lane said the company’s direct relationships with hyperscalers and key intermediaries provide visibility into customer plans, and that management sees “no letdown whatsoever” in their need to continue building capacity.
McKenna said much of the company’s current backlog consists of projects that were already planned and permitted. He added that modular capacity is more programmatic and can be directed toward customer locations as needed.
Acquisition and Capital Allocation
The company also discussed its acquisition of Hunt Electric, a Utah-based electrical contractor that closed May 1. Lane said Hunt is expected to contribute approximately $250 million in annualized revenue.
McKenna said Hunt has begun pursuing opportunities jointly with Comfort Systems USA’s mechanical contractors in Utah and called it the premier electrical provider in that market.
Comfort Systems USA increased its quarterly dividend by $0.10 to $0.90 per share. George said capital allocation will continue to include investments in facilities, selective share repurchases and a patient approach to acquisitions.
Management also highlighted the longer-term service opportunity created by its growing data-center installed base. McKenna said service revenue increased 7% during the year and remains profitable, though the data-center service opportunity is expected to develop over time as newly constructed facilities move beyond warranty periods.
About Comfort Systems USA (NYSE:FIX)
Comfort Systems USA, Inc is a U.S.-based mechanical contracting company that provides a range of heating, ventilation and air conditioning (HVAC) services to commercial, industrial and institutional customers. The company focuses on the design, installation, maintenance and repair of HVAC systems, and it supports projects from initial engineering and system selection through long-term service agreements and upgrades.
Its service offerings include new construction and retrofit installations, preventive and corrective maintenance, emergency repair, energy management and building automation systems.
