The great thing about digging yourself out of a hole is that your work above ground tends to go much more smoothly.
That’s where civil construction behemoth Tutor Perini finds itself today.
After years of settling disputes on legacy megaprojects, it has whittled down outstanding litigation from about 50 cases to 12, executives said Feb. 26 on its fourth-quarter and full-year 2025 earnings call. That helped the Los Angeles-based contractor swing back to full-year profitability last year.
“We spent a lot of money over the last several years on litigation expense,” said Gary Smalley, the firm’s CEO and president, on an earnings call to discuss results. “Legal expenses are something that, of course, are necessary in business and certainly in this industry. But I think you’ll see less and less legal expenses from us, and that’s only going to drive profit improvement too.”
But it’s not just decreased legal fees that are helping the firm. Smalley said the company was driving higher profitability from its various segments by negotiating better terms on big jobs.
By the numbers
The firm reported a profit of $80.4 million for 2025, reversing a loss of $163.7 million during the previous year. For the fourth quarter, it was also in the black, notching $28.8 million in net income versus a $79.4 million loss in the year-ago period.
“We had our best year ever in 2025,” Smalley said, highlighting the firm’s $20.6 billion in backlog at the end of 2025, a 10% increase from a year earlier. “With this tremendous backlog, we are confident in our ability to produce double-digit revenue and earnings growth and continued strong annual cash flow in 2026 as our newer projects progress through design and into construction.”
The firm’s revenue came in at $5.54 billion for the year, a 28% increase from 2024. For the fourth quarter, Tutor Perini reported $1.51 billion in revenue, a 41% jump from 2024’s final quarter.
However, an unfavorable $54.7 million settlement on a legacy dispute involving a tunneling project in Canada largely offset favorable settlements of $57.6 million during 2025, the company reported.
Better terms
What has really been going right for the firm, Smalley said, was securing better contract terms from clients, who have been more willing to negotiate as fewer contractors bid on multibillion-dollar megaprojects, which hold increased risk due to complexity and longevity.
“What we’ve been able to do with the limited competition is to work with our customers, our owners, in order to drive, you know, better payment terms,” Smalley said. “No damages for delay, especially in New York.”
On that front, Smalley said the contractor was back to work on the Manhattan Tunnel portion of the Hudson Tunnel Project in New York City, after federal funding was restored by court order. “We’re back working after about a two-week suspension,” he said.
Big awards
That overall bidding environment has helped Tutor Perini win nine of 11 bids on jobs of $1 billion or more in the last three years, Smalley said, for $16 billion total.
Smalley listed out a slew of 2025 wins that contributed $7.4 billion in new awards to its backlog last year, including:
- The $1.87 billion Midtown Bus Terminal Replacement Phase 1 project in New York City.
- The aforementioned $1.18 billion Manhattan Tunnel project.
- The approximately $1 billion UCSF Benioff New Children’s Hospital in Oakland, California.
- A $538 million healthcare project in California.
- $241 million of additional funding for the Apra Harbor Waterfront Repairs project in Guam.
- A $182 million military defense project in Guam.
- The $155 million Diego Rivera Performing Arts Center at City College of San Francisco.
- $131 million of additional funding for an electrical project in Texas.
- A $100 million-plus electrical project at Cook Children’s Medical Center in Fort Worth, Texas.
He also listed out several new bidding opportunities the firm plans to pursue in the next 12 to 18 months, including:
- An approximately $12 billion program for the Sepulveda Transit Corridor in Southern California.
- The $3.8 billion Southeast Gateway Line in Los Angeles.
- The approximately $700 million Metro Gold Line Foothill Extension, also in Southern California.
- The multi-billion dollar Penn Station Transformation project in New York City.
- The $3 billion Newark Liberty International Airport Terminal B project in New Jersey.
- The $1.4 billion I-535 Blatnik Bridge project in Duluth, Minnesota.
- The $1 billion I-69 ORX Section 2 project connecting Indiana and Kentucky.
Smalley said the company was benefitting from a continued focus on infrastructure spending, an aspect that had been missing in years past.
“Our country has for decades and until recently inadequately funded and prioritized the types of substantial infrastructure investments being made today,” Smalley said.
However, going forward Smalley cautioned that Tutor Perini’s backlog going forward could have some “lumpiness,” due to the timing of awards in mid-2026 and early 2027.
Still, with a positive funding environment in place,Tutor Perini had the wind at its back, Smalley said, and could afford to be choosy on projects it takes on going forward.
“We remain highly selective as to which opportunities we will pursue, with a continued focus on bidding projects with favorable contractual terms, limited competition and higher margins,” Smalley said.
