Southland Holdings Reports 23.1% Revenue Growth but Net Loss in Q3 2025

Southland Holdings, Inc. reported its financial results for the third quarter of 2025, revealing a revenue increase of 23.1% to $213.3 million compared to $173.3 million in the same period last year. The Civil segment contributed significantly to this growth, with revenues rising by $43.6 million, while the Transportation segment saw a slight decline of $3.6 million. Despite the revenue increase, the company recorded a net loss of $76.9 million, compared to a loss of $58.1 million in the prior year, primarily due to increased interest expenses and a valuation allowance against deferred tax assets.

In terms of operational performance, Southland's cost of construction decreased by 6.4% to $210.1 million, reflecting a $29.2 million reduction in the Transportation segment, which was offset by a $14.8 million increase in the Civil segment. The gross profit for the quarter was $3.3 million, a significant improvement from a gross loss of $51.1 million in the previous year, driven by the absence of prior year unfavorable adjustments. Selling, general, and administrative expenses also decreased by 16.6% to $14.6 million, contributing to a reduced operating loss of $11.3 million.

The company’s total assets as of September 30, 2025, stood at $1.136 billion, down from $1.204 billion at the end of 2024. This decline was attributed to a decrease in cash and cash equivalents, which fell to $40.5 million from $72.2 million. Southland's total liabilities increased slightly to $1.049 billion, with long-term debt amounting to $216.4 million. The company’s equity decreased to $87.4 million, reflecting an accumulated deficit of $214.7 million.

Strategically, Southland continues to focus on its core infrastructure construction business, with a backlog of $2.3 billion as of September 30, 2025. The company anticipates recognizing approximately 39% of this backlog as revenue over the next twelve months. Southland's management remains optimistic about future growth opportunities, particularly in the Civil segment, which is expected to benefit from ongoing infrastructure investments and projects initiated after September 2024.

Looking ahead, Southland Holdings is navigating a competitive landscape while managing the impacts of market conditions, including rising interest rates and potential supply chain disruptions. The company is committed to maintaining liquidity and has indicated that it expects cash flow from operations, along with available cash and financing sources, to meet its liquidity needs for at least the next twelve months.