Company: MTZ
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0000015615-25-000021
Chunk: 528

Company: MASTEC INC
Filing Date: 2025-02-28
Form: 10-K
Item: Item 1
Chunk 528
---
 industry declines, changes or delays in new projects, and/or changes in consumer or customer demand.  Variations in project schedules or unanticipated changes in project schedules, in particular, in connection with large construction and installation projects, can create fluctuations in revenue, which may adversely affect us in a given quarter, even if not for the full year.  In addition, revenue from master service and other service agreements, while generally predictable, can be subject to volatility, including from changes in end market customer demand, customer revenue mix, or project timing.  The financial condition of our customers and their access to capital; variations in project margins; regional, national and global economic, political and market conditions; regulatory or environmental influences, including climate-related matters; and acquisitions, dispositions or strategic arrangements can also materially affect quarterly results in a given period.  Accordingly, our operating results in any particular period may not be indicative of the results that can be expected for any other period.

Understanding Our Results of Operations 

Revenue.  We primarily provide engineering, building, installation, maintenance and upgrade services to our customers.  We derive revenue from projects performed under master and other service agreements as well as from contracts for specific projects requiring the construction and installation of an entire infrastructure system or specified units within an infrastructure system.  See Item 1. “Business” for discussion of our business and revenue-generating activities and “Comparison of Fiscal Year Results” below for revenue results by reportable segment.

Costs of Revenue, Excluding Depreciation and Amortization.  Costs of revenue, excluding depreciation and amortization, consists principally of employee compensation, including salaries, employee benefits and incentive compensation; certain other employee expenses, including travel and training; subcontracted services; equipment and facility rentals; fuel and other equipment expenses; repairs and maintenance; materials and supplies; insurance expenses; certain legal and settlement matters; and certain other operating expenses.  Project profit is calculated by subtracting a project’s costs of revenue, including project-related depreciation, from project revenue.  Project profit and corresponding project margins will generally be reduced if actual costs to complete a project exceed our project cost estimates and we are unable to pass the increased costs to our customers.  Estimated losses on contracts, or the excess of the total estimated costs to complete a contract over the contract’s total estimated contract 

34

transaction price, are recognized in the period in which such losses are determined.  Factors impacting our costs of revenue, excluding depreciation and amortization, and project profit, include:

Project Mix.  Revenue