Shimmick Corporation (NASDAQ: SHIM) reported second-quarter 2026 consolidated revenue of $107 million, with adjusted EBITDA turning positive to $4 million from a loss of $234,000 in the same period last year.

The infrastructure contractor achieved a gross margin of 12%, up from 6% in Q2 2025, driven by the strategic wind-down of lower-margin non-core projects. The company ended the quarter with a record backlog of $991 million, supported by $138 million in new awards during the quarter and an additional $221 million secured post-close.

Financial Performance

Shimmick’s project revenue for Q2 2026 was $96 million, down from $113 million in Q2 2025, as older projects reached completion. However, non-core project revenue declined more sharply, falling to $11 million from $16 million, reflecting the termination of the Chick Lock replacement project and continued progress in exiting legacy work.

Gross margin from core Shimmick projects decreased by $4 million to $11 million, primarily due to an $11 million decline in margins from winding-down projects. This was partially offset by a $7 million increase in margins from newer ramping projects. Non-core project gross margin improved significantly to $2 million from a negative $7 million, as cost overruns recorded in the prior year did not recur.

SG&A expenses rose to $16 million from $15 million, driven by one-time legal costs and equity issuance expenses. Despite these costs, the net loss narrowed by 44% to $5 million.

What the Numbers Show

The divergence between revenue decline and margin expansion highlights the impact of portfolio mix changes. While total revenue fell 16% year-over-year, the removal of negative-margin non-core work allowed gross margins to double. With non-core backlog now representing less than 3% of the total, future margin pressure from legacy losses is largely eliminated, setting a higher baseline for profitability as new, higher-margin projects begin execution.

Backlog and Strategic Outlook

The company’s book-to-burn ratio stood at 1.4, marking the fourth consecutive quarter of positive performance. CEO Yaral Yaal noted that less than 10% of the backlog booked over the past 12 months has been converted into revenue, indicating significant visibility for future growth.

Key developments include:

• Establishment of a dedicated Mission Critical business unit to target data centers, advanced manufacturing, and defense sectors.
• A West Virginia data center project transitioning to pre-construction, with work expected to start within 60 days.
• Geographic focus on California, Texas, and Washington, with strong demand in water infrastructure and electrification.

Shimmick reaffirmed its full-year 2026 revenue guidance of $525 million to $575 million and adjusted EBITDA guidance of $15 million to $30 million. The company ended the quarter with $33 million in liquidity, comprising $17 million in unrestricted cash and $16 million in available credit.

Shimmick Corporation (NASDAQ: SHIM) reported a significant improvement in operating performance for the second quarter ended July 3, 2026, with gross margin rising 53% quarter-over-quarter to $12 million. The infrastructure solutions provider, which specializes in water, electrical, and critical infrastructure construction, narrowed its net loss to $5 million from $9 million in the prior quarter. This improvement was primarily driven by the ramp-up of higher-margin Shimmick Projects, which contributed $11 million of the total gross margin, while maintaining a robust liquidity position of $33 million.

The company’s strategic shift toward core infrastructure markets is evident in its project mix. Shimmick Projects, defined as those started after the AECOM Sale Transaction focusing on water, climate resilience, energy transition, and sustainable transportation, generated $96 million in revenue. Although this represents a $17 million decrease from the prior year due to the completion of lower-margin operation and maintenance projects, the gross margin quality improved. Conversely, Non-Core Projects, which include legacy work and foundation drilling, saw revenue decline to $11 million as the company continues to wind down these less profitable segments.

Financial Performance Overview

Despite the top-line contraction, profitability metrics showed clear sequential strength. Adjusted EBITDA reached $4 million, marking the fourth consecutive quarter of positive results compared to a negative $0.2 million in the same period last year. The reduction in net loss was attributed to a $4 million increase in gross margin and a $1 million increase in equity earnings from unconsolidated joint ventures, partially offset by higher interest and selling, general, and administrative expenses.

Backlog and Forward Guidance

Shimmick reported a record backlog of approximately $991 million as of July 3, 2026, the highest level since the first quarter of 2024. Shimmick Projects now represent over 97% of this total backlog. The company booked $138 million in new work during the quarter, achieving a book-to-burn ratio of 1.4x, which has remained above 1.0 for four consecutive quarters. Additionally, there are $221 million in pending awards in water and electrical markets, primarily located in California and Texas.

Todd Yoder, Executive Vice President and Chief Financial Officer, stated that the momentum from newer, higher-margin awards reinforces confidence in the business’s earnings trajectory. Consequently, Shimmick updated its full-year 2026 revenue guidance to a range of $525 million to $575 million, representing approximately 12% year-over-year growth at the midpoint. The company reaffirmed its full-year 2026 Adjusted EBITDA guidance of $15 million to $30 million, projecting a 350% improvement over the prior year at the midpoint. This guidance adjustment reflects greater visibility into certain Non-Core work removed from backlog, which was not expected to contribute significantly to gross margin.