Montrose Environmental Group, Inc. (NYSE: MEG) reported record full‑year 2025 revenue of $830.5 million and adjusted EBITDA of $116.2 million, while narrowing its operating loss to a net loss of $0.8 million—an improvement from the $62.3 million loss reported in 2024. The company’s fourth‑quarter revenue rose 2.2% to $193.3 million, driven by $9.1 million of organic growth in the Assessment, Permitting & Response segment and a $12.8 million increase in that segment, offset by a $4.4 million decline in Measurement & Analysis revenue. Q4 adjusted EBITDA margin was 12.4% of revenue, down from 14.4% in the prior year, reflecting lower operating margins in the Measurement & Analysis and Remediation & Reuse segments as the company winds down its renewables business.
The quarter’s earnings beat expectations on both revenue and earnings per share. Analysts had projected a Q4 revenue of $190.64 million; the company delivered $193.3 million, a $2.66 million or 1.4% beat. Adjusted EPS was $0.35, surpassing the consensus estimate of $0.24 by $0.11, a 48.94% surprise. The strong earnings were driven by disciplined cost control, pricing power in the Assessment, Permitting & Response segment, and a favorable mix shift toward higher‑margin services.
For 2026, Montrose raised its consolidated adjusted EBITDA guidance to $125.0 million–$130.0 million and revenue guidance to $840.0 million–$900.0 million, an 8%–10% increase over 2025. The company also reiterated its expectation of $50.0 million–$70.0 million in emergency‑response revenue for the year, underscoring continued demand for its integrated environmental services platform.
"Over a year ago, we announced a pause in acquisitions to highlight the quality and durability of our business. We also shared our expectation that US regulatory volatility would create more tailwinds than headwinds given our unique business model and global client focus. As we reflect on our focused execution in 2025, our business outperformed and exceeded every major objective. We delivered 13% organic revenue growth, expanded EBITDA margins, and generated record cash flow with 75% free‑cash‑flow conversion. Our cash‑flow generation outperformance resulted in 2025 year‑end leverage approximately 0.5x lower than our forecast at the start of 2025. We also accelerated cross‑selling across our platform, expanded our IP portfolio, and attracted incredible talent, all of which position us very well for 2026 and beyond."
"As we look to 2026, we’re in a strong position to strategically restart smaller, bolt‑on and highly accretive acquisitions. Our balance sheet and cash flow give us flexibility, the acquisition pipeline is aligned to our core capabilities, and we will remain disciplined with capital allocation. We see acquisitions as a multiplier to already robust organic growth and continued margin expansion in 2026."
The Q4 margin compression reflects the wind‑down of the renewables business, which reduced operating leverage in the Measurement & Analysis and Remediation & Reuse segments. Despite this, the company’s overall margin expanded to 14.0% for the full year, driven by higher pricing and operational leverage in the Assessment, Permitting & Response segment. Strong cash‑flow generation and a lower leverage ratio position Montrose to pursue strategic acquisitions and sustain organic growth in 2026.
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