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DATE
Wednesday, May 21, 2025, at 9 a.m. EDT
CALL PARTICIPANTS
President and Chief Executive Officer — Daniel Peyovich
Senior Vice President and Chief Financial Officer — Drew DeFerrari
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TAKEAWAYS
Total Contract Revenue: $1.259 billion in Q1 FY2026, representing a 10.2% increase over Q1 FY2025.
Adjusted EBITDA: Adjusted EBITDA reached $150.4 million in Q1 FY2026, translating to 11.9% of revenues and up 14.9% year over year (adjusted EBITDA).
Net Income: Net income was $61 million. Diluted earnings per share were $2.09.
Share Repurchases: 200,000 shares repurchased for $30.2 million.
Backlog: Total backlog was $8.127 billion at the end of Q1 FY2026, with $4.685 billion expected to be executed within the next twelve months.
Revenue Guidance Raised: Full-year contract revenue guidance is now $5.29 billion to $5.425 billion for FY2026, implying 12.5%-15.4% growth in contract revenues.
Q2 Guidance: Expected contract revenues of $1.38 billion to $1.43 billion, adjusted EBITDA of $185 million to $200 million, and diluted EPS of $2.74 to $3.05.
Customer Concentration: AT&T contributed $325.1 million, exceeding 10% of total quarterly revenues.
Service & Maintenance Revenue: Historically, this segment accounts for over 50% of business, and it is described by management as "recurring revenue" because it involves multi-year contracts.
Organic Growth: Slightly positive for the quarter, with opportunity for continued sequential improvement.
DSO Reduction: Days sales outstanding reduced to 111 days, a sequential improvement of three days from Q4 FY2025.
Wireless Acquisition: Wireless equipment replacement work, including the Blackwood Beach acquisition, ramped more quickly than anticipated and outperformed original expectations.
Major Awards: New project awards with Verizon, Windstream, Lumos, and other unnamed ISP and hyperscaler customers expand backlog; certain hyperscaler projects awarded but not yet included in backlog.
Capital Expenditure Outlook: Net CapEx for FY2026 is expected to be in the $220 million–$230 million range.
Tariff & Trade Impact: Management expects recent tariff actions to have "negligible" effect on current build plans or margins due to U.S.-sourced components and labor cost dominance.
BEAD Program: No revenue from BEAD program included in the current fiscal outlook; management expects any significant BEAD-driven awards to impact revenue primarily from FY2027 onward.
SUMMARY
Dycom Industries (NYSE: DY) management raised its full-year revenue target for FY2026 after outperformance across all key metrics, citing a record backlog and diversified customer mix as contributing factors. Shareholder returns were enhanced via opportunistic share repurchases, while operational focus was maintained through sequential DSO improvement and ongoing cost control. Newly secured awards in fiber, data center connectivity, and wireless segments point to expanded market reach, though not all recent wins -- particularly some hyperscaler contracts -- are yet reflected in the backlog. Management confirmed that BEAD program contributions are not included in revenue projections for FY2026, which could offer upside should policy developments accelerate awards in late 2025 or 2026.
Peyovich said, "the impact to Dycom Industries, Inc. and to our customers' current build plans will be negligible" regarding recent tariff and trade actions.
Wireless and fiber-to-the-home programs continued to ramp faster than anticipated, supporting the revised guidance and building on multi-year contract momentum.
Peyovich confirmed, in response to customer consolidation, that "larger customers typically want a national ... player like us to be able to work across many other locations" suggesting continued opportunity as industry consolidation proceeds.
Ongoing dialogue on BEAD awards suggests management anticipates more clarity by the next quarter, but it reiterated that core growth does not depend on BEAD-driven revenues in the current outlook.
INDUSTRY GLOSSARY
Backlog: The value of contractual work awarded but not yet completed or recognized as revenue, used as a key visibility metric.
Fiber to the Home (FTTH): Deployment of fiber optic connections directly to residential properties, enabling high-speed broadband delivery.
BEAD Program: Broadband Equity, Access, and Deployment program; a federal funding initiative to expand high-speed internet infrastructure.
Hyperscaler: Large-scale cloud or internet platforms -- including major data center operators -- driving capital expenditure in digital infrastructure.
Inside the Fence: Work performed within the physical boundaries of a data center property, such as direct connectivity or intra-campus fiber builds.
DSO (Days Sales Outstanding): The average number of days required to collect payment after completing a sale, used as a measure of working capital efficiency.
Full Conference Call Transcript
Daniel Peyovich: Thank you, Callie, and good morning, everyone, and thank you for joining us. We delivered a strong start to fiscal 2026 and continued to make progress against the goals I outlined at the start of the year. I'm pleased to report that we exceeded the high end of our guidance for the quarter on all metrics, including revenue, adjusted EBITDA, and EPS. Our first quarter revenue was $1.259 billion, a 10.2% increase over Q1 2025. Our adjusted EBITDA was $150.4 million, representing 11.9% of revenues and an increase of 14.9% over Q1 2025. In addition, we repurchased 200,000 shares for $30.2 million during the quarter.
As a result of our strong performance and our view of the market today, we are increasing our revenue expectations for the year to a range of $5.29 billion to $5.425 billion. Despite the current macroeconomic uncertainty, we remain confident in the drivers of our industry and our ability to capitalize on the opportunity. This is evident in our record backlog of $8.1 billion, including a record $4.7 billion of next 12 months backlog. We worked hard to diversify our customer base and the services we offer within the telecommunications and digital infrastructure space. This diversification offers us protection from the impact of any single customer or program.
Underpinning each of these drivers and build programs is our service and maintenance business, which has grown significantly along with our revenue in recent years. These services provide consistency and stability as other customers' programs ebb and flow. The nature of the work within this business, that is day-to-day maintenance, restoration, as well as accommodating road moves and other infrastructure work, extending networks in the greenfield developments, when taken at scale, creates consistency in the volume of work and associated revenue. Our growth in this business comes from maintaining newly installed plant from the fiber to the home build, as well as securing additional markets from our customers.
The work is sustainable as the agreements are typically two to four years in duration, and as a reminder, we only include contracts up to their current expiration dates in our backlog. In short, our service and maintenance business provides a stable base of recurring revenue. Our strategy is to build on our service and maintenance business while also capitalizing on other drivers. Whether that's fiber to the home deployments in urban, suburban, and rural America, long haul and middle mile networks, hyperscaler work inside the fence, wireless equipment replacements, or other drivers, we continue to layer these programs into our business in alignment with our growth strategy.
It's visible in the results from last year, it's visible in the results this quarter, and it's visible in the revised outlook we're providing for fiscal 2026. We've built Dycom Industries, Inc. to be resilient and nimble, and we believe we've differentiated ourselves in the industry. Increasing TAM in our industry combined with the speed and commitment with which our customers are planning and executing their strategic plans means complexity has increased. And complexity favors Dycom Industries, Inc. Our customers demand certainty of delivery, they demand certainty of quality, and they want a partner they can trust every step of the way.
Many customers have and continue to consolidate their vendors, shifting more and more work to proven partners with national reach. This shift, just like the increasing complexity of the work they need done, favors Dycom Industries, Inc. Transitioning to the broader economy, while recent tariff and international trade actions have created volatility and market uncertainty, we believe that the impact to Dycom Industries, Inc. and to our customers' current build plans will be negligible. We continue to track this closely and have discussed it with many customers, telecommunications equipment manufacturers, and our equipment suppliers.
While there will be cost increases in some equipment components that come from offshore, the bulk of the components in these builds are produced in the United States. Since labor represents the majority of build costs, tariff implications are diluted as a percentage of the overall build, and as such, we are not anticipating an impact to our current build. Specific to our equipment suppliers, while there are some tariff implications, we believe that the percentage increases are manageable without impacting our margins or our customers' programs. Of course, policies and actions around tariffs and international trade are fluid, and there could be impacts different from what we anticipate today.
Importantly, against this backdrop, demand drivers in our business remain robust. First, many of our customers recently reconfirmed or increased fiber to home targets. As I shared during our last call, the increase in fiber to the home passing is a key driver for our revenue growth, and we delivered on that during the first quarter. We continue to see fiber to the home ramping as many of these programs accelerate.
While we added a number of new projects to our backlog this quarter, I would point to several notable awards with Verizon for both fiber to the home and maintenance work, with Windstream for both fiber to the home and maintenance work, as well as fiber to the home awards with Lumos. Second, fiber demand related to data centers continues to grow. Opportunities to build long haul and middle mile routes to meet the needs of AI infrastructure are increasing, and we are underway and executing well on the Lumen Overvolt project.
All the hyperscalers reiterated or increased their CapEx budget and commitment to AI infrastructure on their most recent calls, and we continue to see these long haul and middle mile networks as a significant addressable market over the long term. While this driver is still in its early days, we are pleased to have received a substantial multiyear award from an ISP for middle mile networks. We expect this recently awarded work to commence later this fiscal year, with revenue ramping in fiscal 2027. Beyond the opportunities for long haul and middle mile routes, we are seeing and have been in discussions to move inside the fence to work directly with hyperscalers.
Generally, this work brings fiber from the meet-me vaults in the right of way directly into the data centers and includes connecting data centers via underground networks within clusters. These meet-me vaults are typically where the backup work we perform for our ISP customers terminate. We were notified of an award from a hyperscaler related to this work that will commence this year but is not yet in backlog. Entry into this scope further expands our TAM and provides another opportunity for us to leverage our skill set, add value directly for the hyperscalers, and further diversify our capabilities as a provider of digital infrastructure services.
Third, while the final construct of the BEAD program remains unknown, additional states have published subgrantee awards with a heavy lean toward fiber infrastructure. We continue to believe that there will be considerable opportunities for us in fiscal 2027, with the possibility of awards in the second half of this year. As we noted during our last call, we have not included revenue from BEAD in our updated financial outlook for fiscal 2026. Importantly, while the BEAD opportunity is significant, we believe the other drivers in our space provide robust ongoing opportunities to support our continued growth in the years to come. Fourth, we maintain our focus on our service and maintenance business and added meaningful awards this quarter.
The day-to-day connection with our customers and our national footprint serve to contract enable further differentiation in the depth of our relationships and the scope and scale of our operation. Lastly, our wireless equipment replacement work, both organic and from our acquisition last year, continues to deliver above expectations. While we are not updating specific wireless guidance for the fiscal 2026 outlook, we believe this work will well outperform the original expectations we gave at the close of the transaction, and we have included this in our Q2 guidance and full-year outlook. I'd like to shift to discussing our progress on the goals I outlined at the start of the fiscal year.
We remain focused on providing long-term value for our shareholders and long-term opportunities for our people. Our approach to pursuit is consistent and disciplined, with a backlog that properly balances risk and return profile to create value for our shareholders. We've proven our ability to capitalize on the opportunity set and that our customers value what Dycom Industries, Inc. brings. With record backlog this quarter and the new market awards across drivers I mentioned earlier, our teams continue their focus on improving free cash flow, and while our progress may not be linear, we expect to continue to improve our cash flow throughout the year.
In summary, we have a well-defined strategy, clear objectives, and explicit metrics to track our progress along the way. We are investing with intention and getting the outcomes and returns we expect. We've demonstrated our ability to execute and capitalize on our strategy and on the increasing TAM in our industry. Despite some tariffs and macroeconomic uncertainty, our customers are steadfast in their fiber to the home and hyperscaler build programs, and we continue to see multiyear opportunities for growth. We've expanded our services inside the fence with hyperscalers, opening us up to entirely new opportunities and further demonstrating the broad diversification of telecommunication and digital infrastructure verticals we serve.
And we continue to deliver at a level that allows us to increase our revenue expectations for the year, and we believe raises the bar in the industry. I'd like to thank our nearly 16,000 teammates for their commitment to working safely every day and for delivering another strong quarter. We believe our customers recognize the difference in working with Dycom Industries, Inc., and we continue to work hard to earn their business every day as we pursue our vision to be the people connecting America. With that, I'll pass the call to Drew.
Drew DeFerrari: Thanks, Dan, and good morning, everyone. We are pleased that we outperformed the high end of our expectations for Q1, delivering solid top-line and adjusted EBITDA growth and margin expansion while also returning capital to our shareholders through share repurchases. First quarter total contract revenues of $1.259 billion grew 10.2% over Q1 of last year. Revenues in the quarter were driven by continued execution of fiber to the home programs, wireless activity, higher maintenance and operation services, and initial revenue contribution from fiber infrastructure programs for hyperscale.
Adjusted EBITDA of $150.4 million or 11.9% of contract revenues increased 49 basis points as a percentage of contract revenues over Q1 2025 and exceeded the high end of our expectations for the quarter. Net income was $61 million, and diluted EPS was $2.09 per share, also exceeding the high end of our expectations. Results for the quarter included income tax benefits resulting from the vesting and exercise of share-based awards of $2.2 million or $0.08 per share compared to $5.9 million or $0.20 per share in Q1 last year. We had one customer, AT&T, that exceeded 10% of total revenues. AT&T was at $325.1 million for the quarter.
Customers exceeding 5% of total revenues for the quarter were BrightSpeed, Charter, Comcast, Frontier, Lumen, Verizon, and an unnamed customer. This presentation of our customer base combined with our annual revenue outlook provides insight into our performance balanced with attention to customer preferences and competitive considerations. We had solid bookings across a broad range of customers in the quarter. Backlog at the end of Q1 was $8.127 billion, including $4.685 billion that is expected to be completed in the next twelve months. Operating cash flows used in the quarter were $54 million, supporting the growth in revenue and reflected seasonal uses of cash.
The combined DSOs of accounts receivable and contract assets net were 111 days, a reduction of three days sequentially from Q4 2025. Strong cash flows remain a key focus area for the company, and we continue to see opportunities for improvement. During the quarter, we repurchased 200,000 shares of our common stock for $30.2 million, generating solid shareholder returns, a priority, and we will remain opportunistic in our approach towards capital allocation. We are closely monitoring the recent actions on tariffs and international trade.
All of Dycom Industries, Inc.'s business operations are based in the United States, and while these actions have created volatility and market uncertainty, we believe the impact to Dycom Industries, Inc. and to the customer's current build plans will be negligible. We are observing increasing momentum across industry drivers, creating significant opportunities for our company. Building on our strong first quarter results and a favorable demand outlook, we are increasing our full-year fiscal 2026 expected range of contract revenues. We now expect total contract revenues to range from $5.29 billion to $5.425 billion, representing a range of 12.5% to 15.4% total growth over the prior year.
For our Q2 of fiscal 2026 outlook, we expect contract revenues of $1.38 billion to $1.43 billion, adjusted EBITDA of $185 million to $200 million, and diluted EPS of $2.74 to $3.05 per share. Additional financial outlook metrics can be found in the presentation materials posted to our IR website. Operator, this concludes our prepared remarks. You may now open the call for questions.
Operator: Thank you. Please press star one on your telephone and wait for your name to be announced. To withdraw your question, please press star one again. And our first question will come from Alex Waters from B of A. Your line is open.
Alex Waters: Hey, good morning. Thanks so much for taking my question. Maybe first off, Dan, you noted the kind of strong performance of Black and Veatch. Is this more of a pull forward of activity, or have you seen kind of a larger And then secondly, just on the maintenance side, you've noted it a couple of times in your opening remarks, but could you could you help size that business for us for Dycom Industries, Inc.?
Daniel Peyovich: Good morning, Alex. On Blackwood Beach, the wireless acquisition, that's a little bit of both. A little bit of a pull forward, but mostly ramping much quicker than expected. Work's going extremely well. The business is well integrated into our overall operations and excited about, you know, how they've done this quarter and the projection ahead. On the maintenance side, absolutely. As I talked about, service and maintenance underpins the drivers in our business, certainly a core part of our strategy that goes back a long way. To both the other drivers, as you've seen. And if you look at our backlog, that growth is not only in service and maintenance but across many drivers.
So very different today than maybe a few years ago. Recurring revenue, I think that's a very important point. Longer-term contracts. And even though in our backlog, we only project them until the end of the current agreement, it's quite common that we get to review those. So consistency when you take it at scale and the scale that we have, across the entirety of the United States and across many, many customers, really gives us the embedded operations, and we can leverage that into customer bills. We can certainly leverage that in opportunities. Leverage it in how we look at our labor and our labor forces and our ability to respond ultimately to our customers' increasing demands.
You asked specifically about size. What I would say we don't give specifics, Alex, but it's historically been over 50% of our business.
Alex Waters: Perfect. Thank you so much.
Operator: Thank you. Our next question will come from Richard Choe from JPMorgan. Your line is open.
Richard Choe: Hi. I wanted to follow-up a little bit on the second quarter guidance. Is that the continuation of strength from the wireless side, or do you see new projects kind of ramping up and help and contribute? To that.
Daniel Peyovich: Morning, Richard. First, I talked last quarter about fiber to home builds and how they're ramping. You know, our customers now I think the total if you look back a little over a year, the total is over 45 million incremental passings that they've added. And, you know, as you've heard on many of our calls, you know, we've been fortunate to be part of those programs that are increasing and also win new markets. So, Richard, as we look out over the years, certainly for Q1, those programs went a little bit quicker than we expected, and as we look towards the rest of the year, that certainly will put in our outlook.
The second part is that's absolutely the wireless business. As I mentioned, it's going very well, integrating very well, and ramping more quickly. So that very much helped in our Q1 results. It's very much part of our Q2 outlook and certainly the outlook for the full year.
Richard Choe: And you mentioned a little bit on the CapEx from your equipment suppliers and that being manageable. I know it could be a little confusing given all the changes we've kind of seen. But is there any potential or idea of maybe pulling forward some of the spending before the tariffs hit or maybe it's too late. Any kind of thoughts there?
Daniel Peyovich: So, Richard, our strategy around the equipment that we purchase in order to do the work, of course, as you know, our customers buy the bulk of what we actually install. But for our equipment manufacturers, it's always something we've been very strategic about. You know, as you saw it coming through COVID, able to stay ahead of that from an equipment perspective. Even though when there were significant shortages, and even then, when costs increased considerably for some of those pieces of equipment, in this particular case, we feel really good about where we are, you know, with the growth that we've had.
We've been spending a lot of time projecting and working with our equipment manufacturers to make sure we can enable that growth. I would add we do that on the labor side as well. Right? We want to make sure that neither of those are going to impede our customers' big plans and aspirations. So we feel good about where we're at. You know, the tariff impacts are real. Right? Things that are coming in from outside the United States. In constant conversations with the manufacturers.
When you look at it in the entirety, when you build up the whole model of what it costs to pass a home or to put in a foot of fiber on the long haul, it's a very small component. So we feel that it's very manageable going forward. Feel good about the size of our current fleet and our ability to adapt to that.
Richard Choe: Great. Thank you.
Operator: Thank you. Our next question will come from Steven Fisher from UBS. Your line is open.
Steven Fisher: Thanks. Good morning. Just a follow-up on some of the cost angles there. It was nice to see the year-over-year margin improvement. I guess, was there anything unusual with the cost this quarter or mix or execution that was contributing to that year-over-year growth? And just curious if there's any reason to think we won't see continued kind of year-over-year margin improvement for the balance of the year.
Drew DeFerrari: Hi. Good morning, Steven. First, operating leverage is what I would focus on. So I talked about last quarter, you know, we're very strategic about how we're investing in the business. Make sure we can stay ahead of growth, make sure we can continue to deliver the level that we've been delivering for our customers and many entities and certainly for our shareholders. So at times, we're investing in the business and it doesn't drop through, and other times, we're able to pass that through down to the bottom line. So operating leverage is a big part of that increase.
As we look forward towards the year, and I think mentioned this a little bit, we do see opportunities for continued margin growth. Working very hard to achieve that. And again, most of that would come from operating leverage. We're always I should note, we're always working on efficiencies of the business. So I don't want that to be mistaken. You know, we've spent a lot of time on safety, a lot of time on quality, a lot of time on production. We've really upped the training, rigor, across the business. Again, this all comes back to make sure we could stay ahead of labor and deliver the quality for our customers.
But at the end of the day, if you think about our margin opportunities right now, the bulk is going to be from operating leverage.
Steven Fisher: Great. And then you know, it sounds like you reiterated your comments and message on BEAD. No change there. It seems like this quarter and the guidance tells us that you really don't need BEAD to deliver double-digit growth since you don't have anything in your revenues for it. I'm just curious, you know, what you're hearing on that program and how you see the importance of it for your business in the next couple of years just in case, you know, as the policy landscape evolves, if it gets further diminished, just kind of want to curious to see how you're thinking about it for the next couple of years.
Daniel Peyovich: I think you hit on the key message there is it's not in our outlook today. We think about the other drivers. We think about the growth of our service and maintenance business that we've grown along with our revenue these past few years. We feel really good about our growth prospects. You see that in the outlook for this year. And I think we feel good about opportunities to go well beyond this year. Regardless of the BEAD. That said, BEAD we continue to believe BEAD is going to be a real opportunity. You know, everybody is expecting to hear something probably in mid-June or July. So hopefully by next quarter, we can provide a little bit more clarity.
We're talking to the broadband offices weekly. Certainly, we're talking to many of the subgrantees in potential subgrantees constantly. There's still a lot of bullishness that a lot of fiber is going to get installed, enroll them America for the BEAD program. As I noted, really, that's going to be calendar 2026 or fiscal 2027. We'll continue to update, Steve, but I think the important takeaway is that it really not needed for a current growth curve. We'd love to have it. We still think there's going to be plenty of rural opportunities with or without BEAD.
Steven Fisher: Perfect. Thanks very much.
Operator: Thank you. Our next question will come from Frank Louthan from Raymond James and Associates. Your line is open.
Frank Louthan: Great. Thank you. Looking at your backlog, is the pace that you're working through the backlog a change from how it's trended historically? Are things moving any faster in can you give us an idea of the current organic growth rate and what percentage of your backlog represents organic growth? Thanks.
Daniel Peyovich: Yeah. The first part, Frank, I think just touching on backlog overall that I'd like to highlight is the diversification. So across customers, across programs, and across drivers, we do feel like we have a really good mix across multiple opportunities. And really, as we look forward to our potential growth in the future, more opportunities out there to continue that diversification. So that's the first point I make on backlog. As far as organic growth, I'll let Drew talk about that a little bit, but if I can just make a couple points. You know, one, we continue to see long-term opportunities for organic growth.
Two, you know, when we think about the businesses in the reason that we've really been highlighting our overall growth, when you think about the business, like, wireless business, we recently acquired, we're investing huge amounts of capital into that business. We're growing it significantly. We're doing a lot of work to make that more efficient and more effective. So this isn't a situation where we're just adding another layer to the cake that came in operating certain level and comes into the business. And I can tell you when Drew and myself and the rest of the leadership team are having conversations, we don't differentiate internally about where we're going to invest.
We're looking for the right kind of opportunities with the right kind of returns for our shareholders. And whether it's organic or inorganic, doesn't matter. The point is that all of those opportunities we're drawing. So we feel good about, you know, obviously, the overall growth this year, feel good about our opportunities for continued organic growth. And I'll let any of the numbers. Yes. Frank, good morning. So organic growth was slightly positive this quarter. We did disclose it. So you'll see that.
And then if you recall from last quarter, I called out that last year, at the beginning of the year, we had a couple of customers that had a busier start and then they slowed later in the year. And so we're lapping those quarters in the first and second quarter of this year. So we see opportunities for organic growth that to continue to grow from here. Frank, I think you mentioned burn rate. there. Too and Volley. I did hit that one. But we still feel good about the pace of our business, and we don't see any big Okay. Great. Thank you.
Operator: Thank you. Our next question will come from Sangita Jain from KeyBanc Capital Markets. Your line is open.
Sangita Jain: Thank you. Good morning. Thanks for taking my questions. So one I have on your guidance raise. So if we look at 1Q results and the 2Q guide, I'm wondering if that implies some conservatism in your full-year guidance range in the sense that you may not be factoring in the full impact of the extra week? Or if there's something else that we are missing. I know you referenced some pull forward.
Daniel Peyovich: Good morning. Thank you. We certainly included the extra week in the year, and it's important to note. So one, yes, we've included the outperformance in Q1. We certainly have looked at Q2 as you look across the scope of our business, you know, we have hundreds, in fact, thousands of projects, and of course, when we project that, we project it project by project. Don't all move in the same rate in the same direction at the same time. We spend a lot of time about that. We feel really good about the growth. And the increase in the outlook that we gave for the year and the increase in the outlooks of Q2.
And believe, one, it's achievable and there's opportunities for our continued growth.
Sangita Jain: Great. And then a follow-up on your commentary around your expanded O and M business. Longer time, do you think that can reduce your capital intensity and be more, like, a free cash flow accretion event over time? How should we think about that?
Daniel Peyovich: Yes. Indeed. I appreciate the question. So free cash flow continues to be a priority for the company. Pleased that we had DSO improvement in the quarter. We work hard at that, and we'll continue to. We're not satisfied yet with where we're at there. Just from a CapEx perspective, we did have a busier start to the year or an active start to the year, I should say, around that. We do still see the range of total cap or net CapEx for the year in that $220 million to $230 million range. And we're working hard at the operating cash flow.
Sangita Jain: Great. Appreciate that. Thank you.
Operator: Our next question will come from Adam Thalhimer from Thompson Davis. Your line is open.
Adam Thalhimer: Hey. Good morning, guys. Congrats on the beat. Hey, Adam. Good morning. Hey, Dan. I wanted to follow-up on you're talking kinda fast. It sounded like there were two incremental awards. One was for middle mile, fiber for data centers, and one was for inside of the fence work for a hyperscaler customer. Were those both awarded after the quarter, and are they in the revenue guide? I think that I'm in good point. So appreciate the opportunity to highlight it. So the first one is for a customer other than Lumen. That's middle mile or work to enable the AI So different customer, great with the customer there. The second is separate.
So that one is included in our backlog. And the second one, the inside defense work that I talked about, important point I was trying to make is this is a new opportunity set for us. It's work that we do all the time. But, you know, moving from the right of way in and inside the fence quite literally inside the fence into these data centers and data center clusters in a new scope. So work that we know well this really comes out of the evolution of us spending years now with the hyperscalers. And myself personally, of course, you know, I spent a couple of decades working with the hyperscalers, building these data centers.
So things that we feel really good about, but it is a good opportunity set and one that we hope to be able to expand in future years certainly in future quarters The reason I noted about the award itself is this one's just a little unique. to start. We have an MSA for the work. They won't issue the PO technically until we're about So that work is not included in backlog, but we do anticipate that work to happen this year.
Adam Thalhimer: Got it. And are you working inside of the walls of the data center, or is it more connecting when you look at a data center campus, it's more connecting the data center within the campus.
Daniel Peyovich: Absolutely. So typically, we're gonna take the work that we do for the carriers to a vault in the right of way that we refer to as the meet-me vault. From that point is where typically where our work ends. Again, that's on the carrier side, so this is work that the carriers themselves would not typically do. Now we're gonna take it from that vault actually inside the fence and ultimately inside the data centers to land. We won't be taking it in the data center halls into the racks themselves. But we will terminate inside the data center walls. So a good scope opportunity.
We also will connect data centers where they have multiple data centers in one cluster or on one set of sites. We have an opportunity to connect those as well. So again, great opportunity for one that we're excited about and certainly appreciate the work that we've done and will continue to do for the hyperscalers.
Adam Thalhimer: Alright. Great. Thanks for the color.
Operator: Thank you. And as a reminder, to ask a question, please press And our next question will come from Gene Valiz from D. A. Davidson. Your line is open.
Gene Valiz: Good morning, and congrats on the quarter.
Daniel Peyovich: Morning. Thank you.
Gene Valiz: Regarding the charter Cox acquisition following the Verizon and Frontier acquisition, does that further does further customer consolidation drive more business?
Daniel Peyovich: So historically and I think it was there's a little you're breaking up just a little there. But I think you were talking about Verizon, Frontier, and then, you know, crossing additional milestones. So typically when we think about customer consolidation, that's been a positive for us. One, you know, larger customers typically want a national you know, a national player like us to be able to work across many other locations. And two, you know, anytime there's capital infusion in consolidation like that, generally speaking, there's gonna be more opportunities. More investment overall So generally, yes. You know, we think that's positive for us. Historically, it has been.
And again, customers we've been working with for a long time and we're excited about their combination.
Gene Valiz: Great. Thank you. Appreciate the time.
Operator: Thank you. And our next question will come from Laura Mayer from B. Riley Securities. Your line is open.
Laura Mayer: Hi. Thanks for taking the question.
Daniel Peyovich: Good morning.
Laura Mayer: So I was wondering as it relates to government layoffs, have you seen this affect the approval process at all? And are you seeing any early benefits of deregulation?
Daniel Peyovich: So, again, something that these days is quite fluid and we're following very closely. You know, if you're referring to, you know, the potential for easing permitting, that would obviously be a positive for the industry. Think there are a lot of opportunities. We talked a lot about the BEAD and some of the potential pullbacks but to your point, there are a lot of things that could further enable expansion for our customers. If you look at bonus depreciation, in the latest bill, you know, that would obviously be a positive for our customers and they've talked about how that could increase spending. So there are a lot of potential positives. And we'll see how it plays out.
Something we're watching closely every day.
Laura Mayer: Okay. Thanks. I'll pass it on.
Operator: Thank you. And that does conclude our question and answer session for today's call. I'd now like to turn the conference back to Mr. Daniel Peyovich for any closing remarks.
Daniel Peyovich: Yes. I'd like to thank everyone for joining us this morning and look forward to seeing you next quarter. Be safe and be well.
Operator: Thank you. This does conclude our conference. Thank you for participating, and you may now disconnect. Everyone, have a wonderful day.