Tetra Tech Reports Revenue Decline in Q3 and Nine Months of Fiscal 2026

Tetra Tech, Inc. reported a decline in financial performance for the third quarter and first nine months of fiscal 2026, with total revenue of $1.31 billion for the quarter, down 4.5% from $1.37 billion in the same period last year. For the nine months ended June 28, 2026, revenue decreased by 9.1% to $3.74 billion compared to $4.11 billion in the prior year. The company's net income for the third quarter was $109.8 million, a decrease of 3.6% from $113.9 million in the previous year, while net income for the nine months surged to $308.8 million, up 156.9% from $120.1 million, largely due to a significant legal contingency charge in the prior year.

The decline in revenue was primarily attributed to reduced international development projects and lower disaster response activities, particularly in the U.S. federal government sector. Revenue from U.S. federal government contracts fell by 32.5% to $923.6 million, while U.S. state and local government revenue decreased by 12.9% to $522.3 million. In contrast, international revenue grew by 9.9% to $1.63 billion, reflecting increased activities in water utilities and digital water projects. The company also noted that recent acquisitions contributed approximately $180 million to revenue, offsetting some of the declines.

Strategically, Tetra Tech made significant acquisitions during the fiscal year, including Halvik Corp and Providence Consulting Group, for a total purchase price of approximately $232 million. These acquisitions are expected to enhance the company's capabilities in advanced data analytics and project management, particularly within the U.S. federal and international markets. The company also divested its operations in Norway, generating proceeds of $40.3 million and recognizing a non-operating gain of $12.4 million.

Operationally, Tetra Tech's total assets increased to $4.39 billion as of June 28, 2026, up from $4.28 billion a year earlier. The company reported a cash and cash equivalents balance of $230.8 million, a 37.8% increase from $167.5 million at the end of the previous fiscal year. The company’s remaining unsatisfied performance obligations (RUPO) stood at $4.44 billion, indicating a solid pipeline of future work. Tetra Tech's employee headcount remained stable, supporting its operational capacity amid ongoing project demands.

Looking ahead, Tetra Tech anticipates growth in its U.S. federal revenue, excluding the impacts of USAID and disaster response activities. The company remains focused on leveraging its acquisitions to drive organic growth and enhance its service offerings. With a strong liquidity position and access to additional borrowings, Tetra Tech is well-positioned to navigate market challenges and capitalize on emerging opportunities in the engineering and consulting sectors.