ITG Q2 Earnings Call Highlights

ITG (NASDAQ:ITG) reported second-quarter revenue growth of 38% year over year and introduced its first full-year outlook as a public company, following an initial public offering completed July 2.

The company said its IPO generated $323 million in net proceeds, which it used to repay debt and strengthen its capital structure. Chief Executive Officer Andy Parrott said the public listing provides added financial flexibility as ITG pursues organic growth, acquisitions and investments in its operating platform.

“Our second quarter performance reinforced our confidence in the strategy we outlined during the IPO process,” Parrott said.

Second-Quarter Results and Outlook

Second-quarter revenue rose 38% from a year earlier, exceeding the company’s plan, according to Chief Financial Officer Chris Mecray. Growth was primarily driven by acquired businesses and double-digit core growth in ITG’s engineering and maintenance, or E, segment. Those gains were partly offset by slower core activity in infrastructure deployment.

Adjusted EBITDA increased 21% year over year to $52.2 million. Adjusted EBITDA margin was 12.9%, down from 14.7% a year earlier but up from 10.9% in the first quarter.

Mecray attributed the year-over-year margin decline to startup costs for new business and changes in revenue mix tied to acquisitions completed during the second half of 2025. The sequential improvement reflected higher volumes and normal seasonal activity.

Free cash flow, using the company’s adjusted EBITDA minus capital expenditures definition, totaled $44.8 million, compared with $27.2 million in the prior-year period. ITG said the improvement primarily reflected earnings growth. However, the timing of volume ramps and the company’s pre-IPO capitalization resulted in a use of cash from operating activities during the quarter. Management expects positive cash flow and improved working-capital outcomes in the second half, including seasonal cash collections.

For 2026, ITG expects revenue growth of 35% and adjusted EBITDA growth of 36%. Mecray said the full-year outlook calls for revenue of approximately $1.5 billion to $1.6 billion, with growth in the mid-30% range across both E and infrastructure deployment. He said the third quarter is typically the company’s largest seasonal period, while fourth-quarter activity is reduced by fewer construction days around the holidays.

Backlog Expands as Customer Awards Increase

ITG ended the quarter with next-12-month backlog of $1.5 billion, up 6% sequentially and 21% year over year. E backlog increased 11% from the prior quarter and 24% from a year earlier, while infrastructure deployment backlog grew 5% sequentially and 42% year over year.

The company attributed the increases to new and extended master service agreement awards from eight customers. The awards included work from Ziply Fiber, a fiber broadband provider in the Pacific Northwest, and Intrepid Fiber Networks, which develops and operates fiber broadband infrastructure.

Backlog beyond the next 12 months was approximately $3.3 billion, compared with $2.4 billion a year earlier. Mecray cautioned that the longer-term figure is not necessarily a traditional project backlog measure because roughly two-thirds of the business is in the MSA-based E segment, where activity consists of recurring maintenance and fulfillment work orders.

Still, he said the longer-term contracts provide visibility into operations during 2027 and 2028, particularly within the infrastructure deployment business. ITG also has a pipeline exceeding $1 billion, management said.

Data Center Work Expected to Build in Second Half

Management pointed to data centers as an expanding growth opportunity as cloud computing and artificial intelligence increase the need for high-capacity fiber connections between facilities and across broader networks.

Parrott said ITG experienced a significant increase in activity and revenue from data center customers during the second quarter. The company had discussed more than $500 million of backlog with data center customers exiting the prior year, though those contracts extend over multiple years rather than representing near-term revenue alone.

ITG expects data center revenue to be “north of $65 million” in 2026, compared with what management characterized as “small change” last year. Mecray said the company expects that revenue to grow by multiples over the next several years.

Parrott said the company can support both long-haul fiber work and regional interconnection projects. He noted that some customers are considering more distributed data center configurations and the repurposing of existing locations, which could create more interconnection work among facilities. ITG did not receive major new data center awards during the second quarter, but management said it has outstanding bids on multiple contracts that could be decided in coming months.

Full Circle Fiber Acquisition Adds Personnel and Assets

ITG also announced its first acquisition since becoming public, purchasing certain assets of Full Circle Fiber. Parrott described the transaction as a tuck-in acquisition in digital broadband services, while Mecray said it will add hundreds of employees as well as fleet assets and contracts.

Management said Full Circle Fiber had encountered recent challenges and that ITG expects to integrate its people, assets and contracts rapidly. The company expects the acquired business to contribute positively from the outset, though executives said they are still assessing the detailed operating plan and financial contribution for the rest of 2026 and 2027.

ITG’s full-year guidance does not include contributions from future acquisitions, Mecray said.

In addition to communications infrastructure, ITG said it is investing in utility-related opportunities, including civil work involving water and gas infrastructure in Florida and a locate business. Management said startup-related adjustments tied partly to those initiatives should decline during the second half, with limited residual effects expected in the third quarter.

About ITG (NASDAQ:ITG)

ITG, Inc was a financial services company best known for its institutional brokerage and trading services. The firm provided execution, electronic trading, and related brokerage solutions designed to help asset managers and other institutional investors trade securities more efficiently.

The company also offered portfolio trading, agency trading, and workflow tools that supported the investment process from order generation through execution. Over time, ITG developed technology-enabled services aimed at improving trading performance, transparency, and access to liquidity across equity markets.

ITG served institutional clients in the United States and other major financial markets.

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