Arcosa, Inc.

What they do

Arcosa reports three principal business segments serving construction, engineered structures, and transportation markets in North America. Construction Products produces natural and recycled aggregates, specialty materials, asphalt mix, and construction site support equipment such as trench shields and shoring products. Engineered Structures serves utility and related structures and wind towers. The company completed the sale of its steel components business in August 2024 and sold its inland barge and marine components business on April 1, 2026.

Revenue drivers

• Construction Products — Produces natural and recycled aggregates, specialty materials, asphalt mix, and site support equipment; largest revenue segment at $357.0 million in Q2 2026, up 1% year over year.
• Engineered Structures — Utility and related structures plus wind towers; Q2 2026 revenues rose 3% to $301.7 million, with utility structures up 12% and wind towers down 19%.
• Aggregates pricing and cost discipline — Aggregates freight-adjusted average sales price rose 1% and adjusted cash gross profit per ton rose 5% in Q2 2026 on a 3% reduction in unit costs, with segment margin at 48.1%.
• Trench shoring — Higher volumes in trench shoring lifted Construction Products revenues in Q2 2026, partially offsetting lower organic aggregates and asphalt revenue.

Recent performance

Second quarter 2026 continuing-operations revenues were $658.7 million, up 2% from $647.5 million a year earlier, with income from continuing operations of $50.9 million. Adjusted EBITDA from continuing operations rose 5% to $145.9 million and margin expanded 60 basis points to 22.1%. Diluted EPS from continuing operations was flat at $1.03, while adjusted diluted EPS rose 5% to $1.13. Operating cash flow from continuing operations was negative $24.7 million versus positive $38.0 million a year earlier, and free cash flow was negative $51.0 million. Full-year 2025 revenue was $2.88 billion with net income of $208.4 million and diluted EPS of $4.24.

Strategy

Management is pursuing the previously announced merger with CRH Americas, Inc., under which each share would convert into $150.00 in cash; the transaction is expected to close in the first quarter of 2027 pending stockholder approval and regulatory clearance. Operationally, the company is converting an idled wind tower facility to utility structures, which began delivering utility poles in the second quarter of 2026, and plans to convert one existing wind tower facility to utility structures in 2027. It continues to grow its aggregates platform through acquisitions, including the $1.2 billion Stavola construction materials acquisition completed October 1, 2024, which added entry to the New York-New Jersey MSA. Proceeds from the April 2026 barge sale were used partly to prepay $83.0 million of the 2025 Refinancing Term Loan.

Risks

• Weather and seasonality — Heavy rainfall, particularly across Texas operations, reduced organic aggregates volumes and asphalt volumes in the second quarter of 2026, and the business is described as seasonal and susceptible to adverse weather.
• Wind tower demand and tax credits — The One Big Beautiful Bill Act terminates the AMP tax credit for wind towers sold after 2027 and limits PTC eligibility for certain projects, and wind tower revenues fell 19% in Q2 2026 on planned lower volumes.
• Merger completion uncertainty — The CRH merger is subject to stockholder approval and required regulatory approvals and is expected to close in the first quarter of 2027, with no assurance the conditions will be satisfied.
• Input costs and tariffs — The company cites fluctuations in the price and supply of raw materials, parts, and components, including tariffs on foreign imports, and reported higher energy costs year over year in Q2 2026.

Outlook

Management said utility and related structures backlog was $648.1 million as of June 30, 2026, up 49% year to date, providing strong production visibility for the remainder of 2026, with order activity supported by grid hardening and AI-driven electricity demand. Wind tower backlog was $537.4 million, of which 28% is expected to be recognized during the remainder of 2026. Management described Construction Products demand as healthy when seasonal weather is normal, supported by infrastructure spending and private non-residential activity, while single-family residential remains pressured by higher interest rates and affordability.