Primoris Services plunges 50% then 40% as renewables cost overruns mount

Primoris Services Corp. shares lost more than $7.8 billion in market value after two disclosures revealed mounting cost overruns in its renewables business.

"We're focused on when Primoris' management learned of the full scope of the company's renewables problems, including the apparent inadequacy of remediation measures," Reed Kathrein, the Hagens Berman partner leading the firm's investigation, said.

On May 5, Primoris reported Q1 results below analyst expectations and cut its full-year adjusted EBITDA guidance to $480 million to $500 million from $560 million to $580 million, citing lower renewable energy activity and increased project costs. The stock fell $101.69, or 50.11%, to close at $101.23 on May 6. Then on June 22, the company announced the departure of its chief operating officer and further slashed its outlook, citing "cost overruns and delays" on six projects. It now expects renewables revenue of $2.1 billion to $3 billion for 2026, down from $3 billion in 2025. Shares fell $43.34, or 40%, during intraday trading on June 23, closing at $84.95.

The two disclosures erased over $7.8 billion in market capitalization. CEO Koti Vadlamudi attributed the margin collapse to project redesigns, labor issues, sequencing errors and weather disruptions, moving beyond the initial explanation of difficult soil and rock conditions at a single project. At least three law firms — the Law Offices of Frank R. Cruz, Glancy Prongay Wolke & Rotter LLP and Hagens Berman — have opened securities fraud investigations.

Primoris' renewables business, part of its core Energy segment, historically contributed roughly 40% of the company's annual revenue. The February 2026 earnings report first flagged "unexpectedly higher costs" at certain renewables projects, which management initially downplayed as isolated to a single project while expressing confidence in remedial measures.

The May 5 disclosure shattered that confidence. The Energy segment posted a year-over-year revenue decline of $152.9 million, or 13.8%, while gross profits plunged nearly 40%. During the May 6 earnings call, Vadlamudi cited execution failures across multiple solar projects, including costly redesigns, workforce management problems and project sequencing errors.

The June 22 update revealed that problems had spread beyond what management previously acknowledged. The company said additional challenges and cost overruns were identified as progress continued on six projects in the Renewables business. The COO's departure added to investor concerns about operational oversight.

The Law Offices of Frank R. Cruz and Glancy Prongay Wolke & Rotter LLP have also announced investigations into whether Primoris violated federal securities laws by making misleading statements about its renewables business performance. The investigations focus on the period before the May 5 disclosure.

The repeated negative revisions suggest deep structural issues in Primoris' project execution capabilities. Investors will watch for any further updates on remediation plans and whether the company can stabilize its renewables segment, which faces ongoing margin pressure from project delays and cost overruns.

This article is for informational purposes only and does not constitute investment advice.