Company: MTZ
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0000015615-25-000021
Chunk: 1774

Company: MASTEC INC
Filing Date: 2025-02-28
Form: 10-K
Item: Item 3
Chunk 1774
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 expect to be entitled in exchange for the services and goods transferred.  We primarily recognize revenue over time utilizing the cost-to-cost measure of progress, which best depicts the continuous transfer of control of goods or services to the customer, and correspondingly, when performance obligations are satisfied for the related contracts.

Contracts.  We derive revenue primarily from construction projects performed under: (i) master service and other service agreements, which generally provide a menu of available services in a specific geographic territory that are utilized on an as-needed basis, and are typically priced using either a time and materials or a fixed price per unit basis; and (ii) contracts for specific projects requiring the construction and installation of an entire infrastructure system or specified units within an infrastructure system, which may be subject to one or multiple pricing models, including fixed price, unit price, time and materials, or cost plus a markup.  Revenue derived from projects performed under master service and other service agreements totaled 41% of consolidated revenue for the year ended December 31, 2024.

Cost estimation processes used for recognizing revenue over time under the cost-to-cost method require management to make significant assumptions and judgments.  Total transaction price and cost estimation processes are based primarily on the professional knowledge and experience of our project managers, operational and financial professionals, and other professional expertise, as warranted.  Management reviews estimates of total contract transaction price and costs on an ongoing basis.  Changes in job performance, job conditions and management’s assessment of the estimated amount and probability of variable consideration are factors that influence estimates of the total contract transaction price, total costs to complete those contracts and our profit recognition.  Changes in these factors could result in revisions to the amount of revenue recognized in the period in which the revisions are determined, which revisions could materially affect our consolidated results of operations for that period.  Provisions for losses on uncompleted contracts are recorded in the period in which such losses are estimated based on management’s experience and judgment.  For the year ended December 31, 2024, project profit was affected by less than 5% as a result of changes in contract estimates included in projects that were in process as of December 31, 2023.  Changes in recognized revenue, net, as a result of changes in total contract transaction price estimates, including from variable consideration, and/or changes in cost estimates, related to performance obligations satisfied or partially satisfied in prior periods, for the year ended December 31, 2024, positively affected revenue by approximately 0.1%.

Performance Obligations