Everforth Adjusted EBITDA Margin Hits Guidance Ceiling

The Tip Desk · November 9, 2026 · 3 min read

Third-quarter revenue reached $1,031.4 million as Adjusted EBITDA of $106.3 million exceeded the high end of guidance, while its margin of 10.3 percent of sales was at the top end of the company's range.

Everforth, Inc. (EFOR), a technology and digital engineering company, reported third-quarter 2026 revenue of $1,031.4 million, up from $1,011.4 million a year earlier, and said Adjusted EBITDA of $106.3 million surpassed the high end of guidance, while its margin of 10.3 percent of revenues was at the top end of the guidance range.

Chief Executive Officer Ted Hanson said revenues and Adjusted EBITDA surpassed the high end of guidance. Net income was $23.1 million, or $0.56 a share, compared with $38.1 million, or $0.87 a share, in the third quarter of 2025.

Commercial Segment revenues were $719.9 million, 70 percent of the total, and Federal Government Segment revenues were $311.5 million. Sequentially, Commercial revenue rose from $701.7 million in the second quarter.

Within Commercial, Technology, Media and Telecom increased $20.0 million, or 14.6 percent, year over year, and Business Services increased $5.6 million, or 7.2 percent. The remaining three industries decreased. Sequentially, TMT rose $12.4 million, or 8.6 percent, and Business Services rose $6.3 million, or 8.2 percent. In the prior quarter, only TMT had grown year over year, up $7.7 million, or 5.6 percent, while four industries declined.

Federal Government revenue rose from $300.1 million a year earlier. National Security and Federal Civilian revenues increased year over year, partially offset by decreases in Defense and Intelligence and other clients.

Consolidated gross margin was 28.3 percent, down 110 basis points from the third quarter of 2025. Commercial gross margin was 31.9 percent. The company said the compression reflected a lower mix of high-margin permanent placement revenues, foreign-currency effects tied to its Mexico delivery center, and a shift toward certain cloud and infrastructure services with lower margins. Federal gross margin was 19.8 percent, which the company attributed primarily to more cost-reimbursable contracts.

Selling, general, and administrative expenses were $217.7 million, including $8.3 million of acquisition, integration, and strategic planning costs. Adjusted EBITDA was $106.3 million, or 10.3 percent of revenues, compared with $112.6 million, or 11.1 percent, a year earlier.

Operating cash flow was $58.7 million and free cash flow was $46.5 million. On July 7, 2026, the company completed a refinancing and upsizing of its revolver, replacing the previous revolver and Term Loan A with a new five-year $600 million facility due in 2031. It reduced debt by $52.8 million, including $43.8 million of senior secured payments and $9.0 million of senior unsecured notes repurchased at a discount. Cash and cash equivalents were $147.5 million at September 30, with about $227.0 million of revolver availability, a $485.0 million Term Loan B, and $541.0 million of senior unsecured notes. There were no share repurchases in the quarter; about $923 million remained under the buyback plan.

Trailing-twelve-month book-to-bill for Commercial IT consulting was 1.1 to 1. Federal new contract awards for the trailing twelve months were $1.0 billion, with a book-to-bill ratio of 0.9 to 1. Hanson said strong Commercial and Federal bookings reflected continued demand for AI and data, cybersecurity, cloud, and IT modernization services.

For the fourth quarter of 2026, Everforth estimates revenue of $965.0 million to $995.0 million, net income of $17.9 million to $25.5 million, or $0.43 to $0.62 a share, and Adjusted EBITDA of $93.0 million to $103.0 million, or 9.6 percent to 10.4 percent of revenues. Gross margin is estimated at 28.4 percent to 28.7 percent. The company said the quarter has 61 billable days, equal to the year-ago period and three fewer than the third quarter.