Comfort Systems USA Reports First Quarter 2026 Results

Certain statements and information in this press release may constitute forward-looking statements regarding our future business expectations, which are subject to applicable securities laws and regulations. The words “believe,” “expect,” “anticipate,” “plan,” “intend,” “foresee,” “should,” “would,” “could,” or other similar expressions are intended to identify forward-looking statements, which are generally not historic in nature. These forward-looking statements are based on the current expectations and beliefs of Comfort Systems USA, Inc. and its subsidiaries (collectively, the “Company”) concerning future developments and their effect on the Company. While the Company’s management believes that these forward-looking statements are reasonable as and when made, there can be no assurance that future developments affecting the Company will be those that it anticipates, and the Company’s actual results of operations, financial condition and liquidity, and the development of the industry in which the Company operates, may differ materially from those made in or suggested by the forward-looking statements contained in this press release. In addition, even if our results of operations, financial condition and liquidity, and the development of the industry in which we operate, are consistent with the forward-looking statements contained in this press release, those results or developments may not be indicative of our results or developments in subsequent periods. All comments concerning the Company’s expectations for future revenue and operating results are based on the Company’s forecasts for its existing operations and do not include the potential impact of any future acquisitions. The Company’s forward-looking statements involve significant risks and uncertainties (some of which are beyond the Company’s control) and assumptions that could cause actual future results to differ materially from the Company’s historical experience and its present expectations or projections. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: the use of incorrect estimates for bidding a fixed-price contract; undertaking contractual commitments that exceed the Company’s labor resources; failing to perform contractual obligations efficiently enough to maintain profitability; national or regional weakness in construction activity and economic conditions; economic downturns in the markets where the Company operates; shortages of labor and specialty building materials or material increases to the cost thereof; financial difficulties affecting projects, vendors, customers, or subcontractors; unexpected adjustments or cancellations in our backlog resulting in the Company’s backlog failing to translate into actual revenue or profits; inflation, supply chain disruptions, and capital market volatility; the loss of significant customers; intense competition in the Company’s industry; risks associated with acquisitions, including the ability to successfully integrate those companies; impairment charges for goodwill and intangible assets; reductions or reversals of previously recorded revenue or profits as a result of the Company’s cost-to-cost input method of accounting; difficulties in the financial and surety markets; delays and/or defaults in customer payments; difficult work environment; worldwide political and economic uncertainties, including international conflicts and epidemics or pandemics; attraction and retention of key management and employees; the Company’s decentralized management structure; our ability to effectively manage our backlog and the size and cost of our operations; failure of third party subcontractors and suppliers to complete work as anticipated; difficulty in obtaining, or increased costs associated with, bonding and insurance; our ability to remain in compliance with covenants under our credit agreement, service our indebtedness, or fund our other liquidity needs; our inability to properlyutilize our workforce; increases and uncertainty in insurance costs; regulatory and legal risks, including adverse litigation results, failure to comply with laws and regulations; changes in United States trade policy, and tax-related risks; the imposition of past and future liability from environmental, safety, and health regulations including the inherent risk associated with self-insurance; an increase in our effective tax rate; a material information technology failure or a material cybersecurity breach; risks related to our common stock; failure or circumvention of our disclosure controls and procedures or internal control environment; our ability to manage growth and geographically-dispersed operations; severe weather conditions (such as storms, droughts, extreme heat or cold, wildfires and floods), including as a result of climate change, and any resulting regulations or restrictions related thereto; force majeure events; deliberate, malicious acts, including terrorism and sabotage; findings of inadequate internal controls; changes in accounting rules and regulations; and other risks detailed in our reports filed with the Securities and Exchange Commission (the “SEC”).

For additional information regarding known material factors that could cause the Company’s results to differ from its projected results, please see its filings with the SEC, including its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K.

Readers are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date hereof. The Company undertakes no obligation to publicly update or revise any forward-looking statements after the date they are made, whether because of new information, future events, or otherwise, except as otherwise required by law.

— Financial tables follow —

Comfort Systems USA, Inc. Consolidated Statements of Operations (In Thousands, Except per Share Amounts)
		Three Months Ended
		March 31,
		(Unaudited)
		2026				%			2025				%
Revenue		$	2,865,332			100.0	%		$	1,831,286			100.0	%
Cost of services			2,110,920			73.7	%			1,427,870			78.0	%
Gross profit			754,412			26.3	%			403,416			22.0	%
SG&A			268,996			9.4	%			194,874			10.6	%
Gain on sale of assets			(302	)		—				(556	)		—
Operating income			485,718			17.0	%			209,098			11.4	%
Interest income, net			6,334			0.2	%			2,648			0.1	%
Changes in the fair value of contingent earn-out obligations			(10,370	)		(0.4	)%			(3,758	)		(0.2	)%
Other income, net			464			—				24			—
Income before income taxes			482,146			16.8	%			208,012			11.4	%
Provision for income taxes			111,768							38,723
Net income		$	370,378			12.9	%		$	169,289			9.2	%
Income per share
Basic		$	10.52						$	4.77
Diluted		$	10.51						$	4.75
Shares used in computing income per share:
Basic			35,207							35,524
Diluted			35,251							35,605
Dividends per share		$	0.700						$	0.400

Supplemental Non-GAAP Information — Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”) — (Unaudited) (In Thousands)
		Three Months Ended
		March 31,
		2026				%			2025				%
Net income		$	370,378						$	169,289
Provision for income taxes			111,768							38,723
Other income, net			(464	)						(24	)
Changes in the fair value of contingent earn-out obligations			10,370							3,758
Interest income, net			(6,334	)						(2,648	)
Gain on sale of assets			(302	)						(556	)
Amortization			20,394							20,115
Depreciation			18,566							14,010
Adjusted EBITDA		$	524,376			18.3	%		$	242,667			13.3	%

Note: The Company defines adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”) as net income, provision for income taxes, other income, net, changes in the fair value of contingent earn-out obligations, interest income, net, gain on sale of assets, goodwill impairment, other one-time expenses or gains and depreciation and amortization. Other companies may define Adjusted EBITDA differently. Adjusted EBITDA is presented because it is a financial measure that is frequently requested by third parties. However, Adjusted EBITDA is not considered under generally accepted accounting principles as a primary measure of an entity’s financial results, and accordingly, Adjusted EBITDA should not be considered an alternative to operating income, net income, or cash flows as determined under generally accepted accounting principles and as reported by the Company.

Comfort Systems USA, Inc. Condensed Consolidated Balance Sheets (In Thousands)
		March 31,				December 31,
		2026				2025
		(Unaudited)
Cash and cash equivalents		$	1,050,164			$	981,898
Billed accounts receivable, net			2,805,270				2,577,858
Unbilled accounts receivable, net			137,070				123,197
Costs and estimated earnings in excess of billings, net			128,007				88,817
Other current assets, net			380,420				338,783
Total current assets			4,500,931				4,110,553
Property and equipment, net			515,796				387,952
Goodwill			1,025,515				1,025,515
Identifiable intangible assets, net			464,774				485,168
Other noncurrent assets			431,330				431,981
Total assets		$	6,938,346			$	6,441,169
Current maturities of long-term debt		$	25			$	6,163
Accounts payable			719,590				696,348
Billings in excess of costs and estimated earnings and deferred revenue			2,345,279				2,120,262
Other current liabilities			565,899				571,077
Total current liabilities			3,630,793				3,393,850
Long-term debt			39,054				139,063
Other long-term liabilities			453,451				459,482
Total liabilities			4,123,298				3,992,395
Total stockholders’ equity			2,815,048				2,448,774
Total liabilities and stockholders’ equity		$	6,938,346			$	6,441,169

Selected Cash Flow Data (Unaudited) (In Thousands)
		Three Months Ended
		March 31,
		2026				2025
Cash provided by (used in):
Operating activities		$	388,828			$	(87,950	)
Investing activities		$	(184,001	)		$	(96,783	)
Financing activities		$	(136,561	)		$	(160,448	)
Free cash flow:
Cash from operating activities		$	388,828			$	(87,950	)
Purchases of property and equipment			(147,473	)			(22,208	)
Proceeds from sales of property and equipment			874				1,095
Free cash flow		$	242,229			$	(109,063	)

Note: Free cash flow is defined as cash flow from operating activities less customary capital expenditures, plus the proceeds from asset sales. Other companies may define free cash flow differently. Free cash flow is presented because it is a financial measure that is frequently requested by third parties. However, free cash flow is not considered under generally accepted accounting principles as a primary measure of an entity’s financial results, and accordingly, free cash flow should not be considered an alternative to operating income, net income, or cash flows as determined under generally accepted accounting principles and as reported by the Company.

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Julie Shaeff, Chief Accounting Officer

[email protected]; 713-830-9687

KEYWORDS: Texas United States North America

INDUSTRY KEYWORDS: HVAC Construction & Property Building Systems Manufacturing

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