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Revenue, Receivables and Contract Assets and Liabilities
 9 Months Ended
Oct. 03, 2025
Revenue from Contract with Customer [Abstract]  
Revenue, Receivables and Contract Assets and Liabilities

Note 3. Revenue, Receivables and Contract Assets and Liabilities

The following table presents the Company’s revenue disaggregated by contract types:

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

October 3,

 

 

September 27,

 

 

October 3,

 

 

September 27,

 

(In thousands)

 

2025

 

 

2024

 

 

2025

 

 

2024

 

Fixed-price

 

$

134,338

 

 

$

153,802

 

 

$

339,612

 

 

$

349,182

 

Cost reimbursable

 

 

7,356

 

 

 

11,602

 

 

 

51,930

 

 

 

25,983

 

Equipment and labor revenue

 

 

226

 

 

 

631

 

 

 

890

 

 

 

1,519

 

Total revenue

 

$

141,920

 

 

$

166,035

 

 

$

392,432

 

 

$

376,684

 

 

Projects started after prior ownership ("Shimmick Projects") have focused on critical infrastructure aligned with our strategy, including water, climate resilience, energy transition and sustainable transportation. Projects that started under prior ownership or focus on foundation drilling are referred to as "Non-Core Projects" (formerly referred to as "Legacy and Foundations Projects").

The following table presents the Company’s revenue disaggregated by Shimmick Projects and Non-Core Projects:

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

October 3,

 

 

September 27,

 

 

October 3,

 

 

September 27,

 

(In thousands)

 

2025

 

 

2024

 

 

2025

 

 

2024

 

Shimmick Projects

 

$

106,826

 

 

$

101,475

 

 

$

312,599

 

 

$

275,457

 

Non-Core Projects

 

 

35,094

 

 

 

64,560

 

 

 

79,833

 

 

 

101,227

 

Total revenue

 

$

141,920

 

 

$

166,035

 

 

$

392,432

 

 

$

376,684

 

 

Remaining performance obligations

The Company had $716 million of remaining performance obligations yet to be satisfied as of October 3, 2025. Our remaining performance obligations have a weighted average life of 2.5 years as of October 3, 2025.

Contract Balances

The following table provides information about contract assets (also referred to as costs and estimated earnings in excess of billings on uncompleted contracts and retainage receivable) and contract liabilities (also referred to as billings on uncompleted contracts in excess of costs and estimated earnings and forward loss reserve), which include assets and liabilities that are dependent upon future activity:

 

 

 

October 3,

 

 

January 3,

 

 

 

 

 

 

2025

 

 

2025

 

 

Change

 

(In thousands)

 

 

 

 

 

 

 

 

 

Contract assets, current and non-current:

 

 

 

 

 

 

 

 

 

    Costs and estimated earnings in excess of billings on uncompleted contracts

 

$

87,585

 

 

$

46,603

 

 

$

40,982

 

    Retainage receivable

 

 

6,965

 

 

 

23,517

 

 

 

(16,552

)

        Total contract assets

 

 

94,550

 

 

 

70,120

 

 

 

24,430

 

 

 

 

 

 

 

 

 

 

 

Contract liabilities, current and non-current:

 

 

 

 

 

 

 

 

 

    Billings on uncompleted contracts in excess of costs and estimated earnings

 

 

(5,367

)

 

 

(50,490

)

 

 

45,123

 

    Forward loss reserve

 

 

(42,248

)

 

 

(52,147

)

 

 

9,899

 

        Total contract liabilities

 

 

(47,615

)

 

 

(102,637

)

 

 

55,022

 

        Net

 

$

46,935

 

 

$

(32,517

)

 

$

79,452

 

 

Contract terms with customers include the timing of billing and payment, which usually differs from the timing of revenue recognition. As a result, the Company carries contract assets and liabilities within the condensed consolidated balance sheets. These contract assets and liabilities are calculated on a contract-by-contract basis and reported on a net basis at the end of each period and are classified as current or non-current. Many of the contracts under which the Company performs work also contain retainage provisions. Retainage refers to that portion of our billings held for payment by the customer pending satisfactory completion of the project. Unless reserved, the Company assumes that all amounts retained by customers under such provisions are fully collectible. These assets and liabilities are reported in the condensed consolidated balance sheets within “Contract assets, current,” “Contract assets, non-current,” “Contract liabilities, current" and “Contract liabilities, non-current." A certain portion of our retainage receivable contract asset balance is non-current, and therefore is not presented on a net basis against the associated contract liabilities that are current. Costs and estimated earnings in excess of billings on uncompleted contracts consists of revenue recognized in excess of billings.

Billings on uncompleted contracts in excess of costs and estimated earnings consists of billings in excess of revenue recognized. The Company recognized revenue of $37 million during the nine months ended October 3, 2025 that was included in contract liabilities as of January 3, 2025.

 

The Company’s timing of revenue recognition may not be consistent with its rights to bill and collect cash from its clients. Those rights are generally dependent upon advance billing terms, milestone billings based on the completion of certain phases of work or when services are performed. The Company’s accounts receivable represents amounts billed to clients that have yet to be collected and represent an unconditional right to cash from its clients as presented below:

 

 

 

October 3,

 

 

January 3,

 

 

 

2025

 

 

2025

 

(In thousands)

 

 

 

 

 

 

Total accounts receivable, gross

 

$

42,609

 

 

$

43,942

 

Allowance for credit losses

 

 

(824

)

 

 

(954

)

Accounts receivable, net

 

$

41,785

 

 

$

42,988

 

 

Substantially all contract assets as of October 3, 2025 and January 3, 2025 are expected to be collected within the Company’s estimated operating cycle, except for retainage and claims pertaining to certain contracts. The Company’s operating cycle may extend beyond one year.

The Company is in the process of negotiating or awaiting approval of unapproved change orders and claims with its customers. The Company is proceeding with its contractual rights to recoup additional costs incurred from its customers based on completing work associated with change orders, including change orders with pending change order pricing, or claims related to significant changes in scope which resulted in substantial delays and additional costs in completing the work. With respect to one Non-Core Project, the Company continues to discuss potential change orders and/or changes in scope to the project, each of which or in the aggregate have

the potential to materially impact the Company’s results of operations. The Company may take legal action if it and the customer cannot reach a mutually acceptable resolution. With respect to another Non-Core Project, the Company completed the services of an operation and maintenance contract in the third quarter of fiscal year 2025 that was previously winding down.

Information about significant customers

 

Significant Customers as a Percentage of Accounts Receivable, Net

 

 

 

As of October 3, 2025

 

 

 

Customer one

 

42.5%

 

 

 

 

 

As of January 3, 2025

 

 

 

Customer one

 

40.6%

 

Customer two

 

20.2%

 

 

Significant Customers as a Percentage of Revenue

 

 

 

Three Months Ended October 3, 2025

 

 

 

Customer one

 

21.4%

 

Customer two

 

18.6%

 

Customer three

 

11.1%

 

 

 

 

 

Three Months Ended September 27, 2024

 

 

 

Customer one

 

22.8%

 

Customer two

 

11.9%

 

Customer three

 

11.8%

 

Customer four

 

10.8%

 

 

Significant Customers as a Percentage of Revenue

 

 

 

Nine Months Ended October 3, 2025

 

 

 

Customer one

 

16.1%

 

Customer two

 

14.6%

 

Customer three

 

12.9%

 

Customer four

 

11.8%

 

 

 

 

 

Nine Months Ended September 27, 2024

 

 

 

Customer one

 

17.3%

 

Customer two

 

14.6%

 

Customer three

 

12.1%

 

 

Revisions in Estimates

 

Changes in contract estimates resulted in net increases in gross margin of $2 million for the three months ended October 3, 2025, primarily due to lower cost estimates on favorable scope close out on a Shimmick water project as well as a Non-Core bridge project. Changes in contract estimates resulted in net decreases in gross margin of $7 million for the nine months ended October 3, 2025, primarily due to cost increases related to delays and lower productivity on a federal lock and dam Non-Core Project.

 

Changes in contract estimates resulted in net increases in gross margin of $7 million for the three months ended September 27, 2024, primarily due to the favorable Golden Gate Bridge Project (the "GGB Project") settlement, partially offset by increased forecasted cost to complete loss jobs. Changes in contract estimates resulted in net decreases in gross margin of $44 million for the nine months ended September 27, 2024, primarily due to the settlement on a federal lock and dam Non-Core Project and increased forecasted cost to complete loss jobs, partially offset by the favorable GGB Project settlement.