Granite Construction’s latest reported quarter in its official investor-relations materials is Q2 2026, for the quarter ended June 30 and released July 30, 2026. Before investing, look beyond headline revenue: compare results with the same quarter last year and prior guidance, examine Construction and Materials separately, test whether the company’s Construction Aggregate Projects (CAP) pipeline is converting into profitable revenue, and compare earnings with operating cash flow and capital spending. Q2 brought higher revenue and raised full-year guidance, but Materials margins fell and a large convertible-debt transaction loss drove a sharp gap between GAAP and adjusted results.
Start with comparable results, not a headline number
Granite reported Q2 2026 revenue of $1.46 billion, up $330 million, or about 29%, from $1.13 billion in Q2 2025. Adjusted diluted EPS was $2.16 versus $1.93, and adjusted EBITDA was $186 million versus $152 million. These are company-reported figures; adjusted measures are non-GAAP. Compare each quarter with its year-earlier counterpart and with the guidance management had given before results came out. Construction activity is seasonal, so a single quarter should not be treated as a stand-in for the full year.
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Granite’s Q2 2026 results release gives the current-quarter figures and management’s explanations. The Q1 2026 release is useful for checking what changed in the outlook between quarterly reports.
Separate Construction from Materials
Granite reports two segments, Construction and Materials. Combining them into one growth rate can conceal different operating trends: construction contracting and materials production do not necessarily face the same costs, weather effects, or margin patterns.
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Construction: revenue growth and gross margin
Q2 Construction revenue was $1.207 billion, up 28.8% year over year. Its gross margin was 16.5%, compared with 16.4% in Q2 2025. That combination indicates that the reported segment growth came with a broadly similar gross-margin percentage, but it does not by itself establish the profitability of future work.
Materials: growth does not guarantee stronger margins
Materials revenue was $248.4 million, up 31.7%, while gross margin declined to 16.1% from 24.1%. Cash gross margin, a non-GAAP measure, was 28.2% versus 31.3%. Granite attributed the lower Materials margins primarily to severe weather in the Southeast and higher quarry-development costs. Read the release’s reconciliations when using cash gross profit or cash gross margin, and compare them with GAAP gross profit and margin rather than treating the non-GAAP measure as a replacement.
Distinguish reported growth from organic growth
Acquisitions contributed to Q2 revenue. Granite said acquired businesses Warren Paving, Papich Construction, and Kenny Seng Construction contributed $98 million in Construction, while acquired businesses including Cinderlite contributed $60 million in Materials. Reported segment growth therefore should not be described as entirely organic. Consider how much growth came from acquired operations and whether the company can sustain margins as those businesses are integrated.
Test whether CAP turns into profitable revenue
At June 30, 2026, Granite’s Construction Aggregate Projects (CAP) balance was $7.4 billion, up $250 million sequentially and $1.4 billion year over year. CAP is a company-defined pipeline measure, not current-period revenue, guaranteed sales, or a direct measure of profit.
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Granite defines CAP as expected future revenue on executed contracts. Its calculation includes the full value of consolidated joint-venture contracts and Granite’s proportionate share of unconsolidated joint ventures. It can also include specified portions of CM/GC, CMAR, and progressive design-build work when contract execution and funding are considered probable. Because the measure includes different contract structures and qualifying work, use Granite’s definition in the Q2 release when comparing periods.
- Track whether CAP additions are exceeding, matching, or falling behind recognized Construction revenue over multiple periods.
- Look for explanations of timing, cancellations, project starts, and changes in the pipeline rather than assuming each dollar of CAP becomes revenue immediately.
- Compare the margins on work being performed with the outlook implied by the pipeline; a larger CAP balance alone does not prove that future work will earn attractive returns.
Compare earnings with operating cash flow and capital spending
Granite generated $142 million of operating cash flow in the first half of 2026, compared with $5 million in the first half of 2025. The company also raised its full-year operating-cash-flow target from 10% to 11% of revenue. These are reported first-half cash flow and management’s annual target, respectively, not the same kind of figure.
Assess cash generation alongside net income, revenue, and investment needs over several reporting periods. Construction cash flow can be affected by working-capital movements and the timing of project payments, so one half-year or quarter may not establish a lasting trend. Compare operating cash flow with capital expenditures to understand how much cash remains after investment in the business; do not infer that a higher cash flow figure alone means all earnings have converted to cash.
Reconcile GAAP results with adjusted measures
Q2 2026 produced a GAAP net loss attributable to Granite of $278 million, or a diluted loss of $6.36 per share. Granite also reported adjusted net income of $101 million and adjusted diluted EPS of $2.16. The company said the GAAP loss was driven by a $360 million non-operating loss on convertible-debt transactions, which it excluded from adjusted net income and adjusted EBITDA.
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Read the reconciliation in the Q2 results release rather than choosing whichever measure looks more favorable. Consider what an excluded item represents, how large it is, whether it is likely to recur, and how it affects the capital structure. The adjusted figures help describe operating performance under Granite’s definitions; they do not erase the GAAP loss or make the transaction irrelevant to an investor.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.Compare revised guidance with the previous outlook
Granite’s Q2 2026 full-year outlook and Q1 2026 outlook show what management changed after the first half of the year. The Q2 release raised the revenue range by $100 million from the range announced in Q1.
| 2026 outlook item | Q1 2026 guidance | Q2 2026 guidance |
|---|---|---|
| Revenue | $5.2–$5.4 billion | $5.3–$5.5 billion |
| Adjusted EBITDA margin | Not stated in the supplied Q1 guidance figures | 12.25%–13.25% |
| SG&A as a share of revenue | Not stated in the supplied Q1 guidance figures | 8.25%–8.75% |
| Adjusted-net-income effective tax rate | Not stated in the supplied Q1 guidance figures | Mid-20s |
| Capital expenditures | Not stated in the supplied Q1 guidance figures | Approximately $140–$160 million, including about $50 million in strategic Materials investments |
The Q1 range is from Granite’s April 30, 2026 release; the Q2 range is from the July 30, 2026 release. Guidance is management’s outlook, not a realized result. Granite says it cannot reconcile its forward adjusted EBITDA margin guidance to the most comparable GAAP measure because some components cannot be predicted with reasonable certainty and without unreasonable effort. Account for that limitation when using the margin range.
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1Fix the driver behind crashes, sound loss and screen glitches2Clear out junk files and repair common Windows errors3Scan for outdated or missing drivers - takes under a minuteUse the 10-K to understand risks behind the quarter
Quarterly results show recent performance; Granite’s annual Form 10-K provides broader company and risk context. Granite describes a vertically integrated civil-construction and construction-materials business serving public and private infrastructure projects. That model makes it useful to consider both contracting and materials operations, but the segment checklist above is not exhaustive due diligence.
Read the risk factors and forward-looking-statement disclosures in Granite’s 2025 Annual Report / Form 10-K, for the fiscal year ended December 31, 2025. The filing cautions: “Due to the inherent risks and uncertainties associated with our forward-looking statements, the reader is cautioned not to place undue reliance on them.” Treat targets and management explanations as statements of outlook, not assurances of future performance. Granite’s Events and Presentations page lists official earnings events and materials.
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