Willdan Group Reports 1.8% Revenue Increase and 82% Net Income Growth in Q1 FY 2026

Willdan Group, Inc. reported a slight increase in contract revenue for the first quarter of fiscal year 2026, totaling $155.1 million, up from $152.4 million in the same period last year, marking a 1.8% increase. The company's net income also saw a significant rise, reaching $8.5 million compared to $4.7 million in the prior year, reflecting an 82% increase. This growth in profitability was attributed to improved operational efficiency and a favorable shift in revenue mix, particularly within the Energy segment, which accounted for $128 million of the total revenue.

The company's direct costs of contract revenue decreased by 2.9% to $92 million, primarily due to a reduction in subcontractor services, which fell by 6.5%. This reduction was offset by a 5.8% increase in salaries and wages, reflecting the need for additional staffing to support project volume. Gross profit increased by 9.5%, resulting in a gross margin of 40.7%, up from 37.8% in the previous year. General and administrative expenses also rose by 10.3% to $55.9 million, driven by higher salaries, stock-based compensation, and increased depreciation and amortization expenses.

In terms of strategic developments, Willdan completed the acquisition of Compass Municipal Advisors, LLC on January 2, 2026, enhancing its capabilities in municipal advisory services. The company also announced the acquisition of Burton Energy Group, LLC on May 4, 2026, which is expected to further strengthen its Energy segment. These acquisitions are part of Willdan's strategy to expand its service offerings and market reach.

Operationally, Willdan's customer base remains concentrated, with its top ten clients accounting for 49.1% of consolidated contract revenue in the latest quarter. The company operates across 22 U.S. states and has a significant presence in California and New York, which together contributed to a substantial portion of its revenue. As of April 3, 2026, Willdan's employee headcount increased to support its growing operations, although specific figures were not disclosed.

Looking ahead, Willdan anticipates continued growth driven by increased demand for its services in both the Energy and Engineering segments. The company is focused on integrating its recent acquisitions and leveraging operational synergies to enhance profitability. However, it remains cautious about potential risks, including market conditions, competition, and the ability to manage costs effectively in a challenging economic environment.