Infrastructure consulting firm NV5 Global (NASDAQ: NVEE) reported Q1 CY2025 results beating Wall Street’s revenue expectations, with sales up 10.1% year on year to $234 million. The company’s full-year revenue guidance of $1.04 billion at the midpoint came in 1% above analysts’ estimates. Its non-GAAP profit of $0.17 per share was 8.9% below analysts’ consensus estimates.
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NV5 Global (NVEE) Q1 CY2025 Highlights:
- Revenue: $234 million vs analyst estimates of $228.6 million (10.1% year-on-year growth, 2.4% beat)
- Adjusted EPS: $0.17 vs analyst expectations of $0.19 (8.9% miss)
- Adjusted EBITDA: $29.74 million vs analyst estimates of $29.44 million (12.7% margin, 1% beat)
- The company reconfirmed its revenue guidance for the full year of $1.04 billion at the midpoint
- Management reiterated its full-year Adjusted EPS guidance of $1.32 at the midpoint
- Operating Margin: 1.9%, in line with the same quarter last year
- Free Cash Flow Margin: 11.7%, up from 7.5% in the same quarter last year
- Market Capitalization: $1.21 billion
The three acquisitions that we completed in the first quarter had minimal impact on our financial results for the quarter, but they position us for expansion in key geographies and accelerated organic growth. As a result of our strong first quarter performance, backlog, and pipeline of opportunities, we are reaffirming full-year 2025 guidance for revenue and earnings per share," said Ben Heraud, CEO of NV5.
Company Overview
Operating from over 100 locations across the U.S. and internationally, NV5 Global (NASDAQ: NVEE) provides engineering, environmental, geospatial, and technical consulting services to public and private sector clients for infrastructure and building projects.
Sales Growth
Examining a company’s long-term performance can provide clues about its quality. Any business can put up a good quarter or two, but many enduring ones grow for years.
With $962.8 million in revenue over the past 12 months, NV5 Global is a small player in the business services space, which sometimes brings disadvantages compared to larger competitors benefiting from economies of scale and numerous distribution channels. On the bright side, it can grow faster because it has more room to expand.
As you can see below, NV5 Global’s sales grew at an impressive 10% compounded annual growth rate over the last five years. This shows it had high demand, a useful starting point for our analysis.
Long-term growth is the most important, but within business services, a half-decade historical view may miss new innovations or demand cycles. NV5 Global’s annualized revenue growth of 11% over the last two years is above its five-year trend, suggesting its demand was strong and recently accelerated. 
This quarter, NV5 Global reported year-on-year revenue growth of 10.1%, and its $234 million of revenue exceeded Wall Street’s estimates by 2.4%.
Looking ahead, sell-side analysts expect revenue to grow 7.6% over the next 12 months, a deceleration versus the last two years. Still, this projection is noteworthy and indicates the market sees success for its products and services.
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Operating Margin
NV5 Global was profitable over the last five years but held back by its large cost base. Its average operating margin of 6.9% was weak for a business services business.
Analyzing the trend in its profitability, NV5 Global’s operating margin decreased by 2.5 percentage points over the last five years. This raises questions about the company’s expense base because its revenue growth should have given it leverage on its fixed costs, resulting in better economies of scale and profitability. NV5 Global’s performance was poor no matter how you look at it - it shows that costs were rising and it couldn’t pass them onto its customers.
This quarter, NV5 Global generated an operating profit margin of 1.9%, in line with the same quarter last year. This indicates the company’s overall cost structure has been relatively stable.
Earnings Per Share
We track the long-term change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company’s growth is profitable.
NV5 Global’s EPS grew at a decent 7.7% compounded annual growth rate over the last five years. However, this performance was lower than its 10% annualized revenue growth, telling us the company became less profitable on a per-share basis as it expanded.
We can take a deeper look into NV5 Global’s earnings to better understand the drivers of its performance. As we mentioned earlier, NV5 Global’s operating margin was flat this quarter but declined by 2.5 percentage points over the last five years. Its share count also grew by 25.6%, meaning the company not only became less efficient with its operating expenses but also diluted its shareholders. 
In Q1, NV5 Global reported EPS at $0.17, in line with the same quarter last year. This print missed analysts’ estimates, but we care more about long-term EPS growth than short-term movements. Over the next 12 months, Wall Street expects NV5 Global’s full-year EPS of $1.18 to grow 12.7%.
Key Takeaways from NV5 Global’s Q1 Results
It was encouraging to see NV5 Global beat analysts’ revenue expectations this quarter. We were also happy its full-year EPS guidance outperformed Wall Street’s estimates. On the other hand, its EPS missed significantly. Overall, this was a mixed quarter. The stock remained flat at $18.43 immediately following the results.
Is NV5 Global an attractive investment opportunity right now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here, it’s free.
