Jacobs Solutions Inc. (J): BCG Matrix [Dec-2025 Updated]

You're looking at Jacobs Solutions Inc.'s portfolio post-spin-off, and the BCG Matrix cuts right to the chase: where should your focus be in late 2025? We've mapped the segments showing high-growth potential, like PA Consulting with $1.27 billion in FY25 revenue, against the stable Cash Cows fueling the business, which boasts a 13.6% consolidated operating margin. But the real story is seeing which digital platforms are the high-risk Question Marks and which low-margin engineering projects are finally being shed as Dogs-dive in to see the strategic breakdown.

Background of Jacobs Solutions Inc. (J)

You're looking to map out where Jacobs Solutions Inc. (J) stands right now, so let's start with the numbers from their recently closed fiscal year 2025, which ended on September 26, 2025. This company, founded way back in 1947, is a major global player, still employing around 45,000 people as of late 2025, providing services from advisory to program management.

For the full fiscal year 2025, Jacobs Solutions posted gross revenue of $12.0 billion, which was a 4.6% increase year-over-year, with adjusted net revenue coming in at $8.7 billion, up 5.3% from the prior year. Honestly, the operational performance looked strong; adjusted EBITDA grew by 13.9% to reach $1.2 billion, and adjusted Earnings Per Share (EPS) jumped 15.9% to $6.12. Plus, they managed to convert over 100% of net income into reported free cash flow, which is a solid sign of financial discipline.

The demand for their work is definitely there, evidenced by a record backlog hitting $23.1 billion, marking a 5.6% year-over-year increase. This backlog, combined with a trailing twelve-month book-to-bill ratio of 1.1x, suggests they are securing longer-duration, higher-value contracts. In terms of capital allocation, Jacobs Solutions returned a record $1.1 billion to shareholders in FY25 via dividends and share repurchases.

When we look at the business structure, the company is heavily weighted toward its Infrastructure & Advanced Facilities (I&AF) segment. For FY 2025, I&AF generated net revenue of $7.43 billion, a 4.91% increase, with growth in key areas like Data Center, Water, Energy & Power, and Transportation. The PA Consulting segment also showed acceleration, posting revenue of approximately $1.27 billion for the year, which was up 7.5% year-over-year. The strategy here is clearly shifting toward securing more stable, multi-year contracts in these high-growth end markets, which is important context for our next step.

Jacobs Solutions Inc. (J) - BCG Matrix: Stars

You're looking at the business units within Jacobs Solutions Inc. (J) that are currently dominating high-growth arenas, which is exactly what the Stars quadrant of the Boston Consulting Group Matrix is for. These are the areas where market share is strong, and the market itself is expanding rapidly, meaning they need significant investment to maintain that lead.

The PA Consulting group is definitely a Star, quietly evolving into a structural foundation for Jacobs Solutions Inc. For fiscal year 2025, this segment delivered revenue of approximately $1.27 billion, marking a year-over-year growth rate of 7.5%. To give you a sense of its current strength, the Q4 FY25 revenue for PA Consulting hit $318 million, which was up 10% year-over-year for that quarter. Furthermore, its profitability is high, with an FY25 operating margin reported at 22.0%, and the Q4 margin even higher at 22.6%.

The Advanced Manufacturing sector, often grouped with Life Sciences, is another key Star, driven by massive investment cycles, particularly in US semiconductor and data center facilities. This combined area saw Q4 FY25 gross revenues reach $728 million, reflecting a 5.8% year-over-year growth rate. The Life Sciences segment specifically is aligned with long-term biotech megatrends, and the expectation is for this combined area to generate steady mid- to high single-digit growth rates going forward.

These high-growth areas are converting the company's overall strong pipeline into real revenue. Jacobs Solutions Inc. is entering FY26 with a record backlog of $23.1 billion, which represents a 5.6% year-over-year increase. This backlog conversion is a key indicator of the high-value, technology-driven project wins that characterize Star performance.

Here's a quick look at the key financial metrics for these high-potential areas as of the end of FY25:

The strategy here is clear: invest heavily to keep market share while the markets are hot. The success of these units is what will eventually transition them into Cash Cows when the high-growth phase naturally slows down. The current focus is on capturing as much of this expanding market as possible.

The growth drivers underpinning these Star positions include:

• PA Consulting operating margin in Q4 FY25 reached 22.6%.
• The overall company delivered a consolidated adjusted operating margin of 13.6% for FY25.
• The company returned a record $1.1 billion to shareholders through dividends and share repurchases in FY25.
• The expectation for FY26 is continued growth in revenue, EPS, and free cash flow.

To be fair, maintaining this pace requires significant capital deployment, which is why the cash flow coming in is generally matched by the cash going out for promotion and placement-it's a necessary investment to secure future Cash Cow status. Finance: draft the FY26 capital allocation plan prioritizing I&AF and PA Consulting growth initiatives by next Tuesday.

Jacobs Solutions Inc. (J) - BCG Matrix: Cash Cows

You're looking at the engine room of Jacobs Solutions Inc. (J) here, the segment that generates the necessary fuel for the rest of the portfolio. Cash Cows, by definition, are market leaders in mature areas, and for Jacobs Solutions Inc., the Core Infrastructure & Advanced Facilities (I&AF) segment fits that description well, representing the largest revenue base.

For fiscal year 2025, the I&AF segment brought in $10.76 Billion in revenue, which was 89.48% of the company's total revenue. That's a clear market leader position. The focus here is on maintaining that share while maximizing cash generation, which is evident in the improving profitability.

Here's a quick look at the segment's financial strength:

The I&AF adjusted operating margin expanded to 12.2% in fiscal year 2025, up from 11.3% in fiscal year 2024. This margin improvement, even in a segment with lower growth prospects, shows they are milking gains effectively through efficiency, not just relying on top-line growth. The consolidated adjusted operating margin for Jacobs Solutions Inc. reached 13.6% for FY 2025, a 100 basis points year-over-year increase from FY 2024's 12.6%. That's steady, reliable expansion.

The stability of the work within this segment is what makes it a Cash Cow. You see this in the strong contract profile, particularly in areas like Water and Transportation solutions. These aren't speculative projects; they are foundational services.

• Life Sciences, Data Center, Water, Energy & Power, and Transportation sectors drove I&AF revenue growth.
• The company secured a record backlog of $23.1 billion as of the end of FY 2025.
• The trailing twelve-month book-to-bill ratio stood at 1.1x, indicating strong forward visibility.

The ultimate measure of a Cash Cow is its ability to generate cash beyond what it needs to sustain itself. Jacobs Solutions Inc. delivered on this front in a big way. The company achieved a high free cash flow conversion, which exceeded 100% of net income in fiscal year 2025. This means the core business units generated more cash than they consumed after accounting for net earnings. This excess cash is what funds the rest of the company's strategy, including shareholder returns.

To support this cash generation, Jacobs Solutions Inc. returned a record $1.1 billion to shareholders in fiscal 2025 through repurchases and dividends. That's the direct benefit of having strong Cash Cows. You defintely want to maintain the infrastructure supporting these reliable cash flows.

Jacobs Solutions Inc. (J) - BCG Matrix: Dogs

Dogs, in the Boston Consulting Group Matrix context for Jacobs Solutions Inc. (J), represent business activities with low market share in low-growth areas, or legacy operations that consume management focus without delivering commensurate returns. These are the areas the company is actively managing down or shedding as part of its transformation into a technology-centric, solutions-oriented firm.

The primary candidates for this quadrant stem from the legacy engineering and construction project work that is inherently cyclical and lower-margin compared to the consulting and advanced facilities offerings. Management's stated strategy focuses on accelerating the shift toward multi-year contracts in secular growth areas like water, life sciences, and advanced manufacturing, which inherently means de-emphasizing the older, transactional project model.

The financial data for fiscal year 2025 shows a clear portfolio shift, which supports the narrative of shedding these lower-performing units. While the company achieved a consolidated adjusted operating margin of 13.6% for fiscal year 2025, the Infrastructure & Advanced Facilities (I&AF) segment, which houses much of the traditional engineering and construction work, reported an adjusted operating margin of 12.2% for FY2025, up from 11.3% in FY2024. This margin expansion within I&AF is driven by the shift to higher-value contracts, suggesting the legacy portion of that segment is the drag being minimized.

The company's active portfolio reshaping, including the spin-off of its Critical Mission Solutions and Cyber & Intelligence units in September 2024, directly addresses the need to minimize cash traps tied up in non-strategic assets.

The environmental sector consulting, while ranked No. 2 globally based on 2023 revenue data, is identified in the scenario as facing headwinds from private sector regulatory volatility in 2025. This suggests that while the overall environmental market is a strategic focus, the specific exposure to volatile private sector contracts within that domain acts as a Dog, consuming resources without stable returns.

The remaining Dogs are the non-strategic, non-digitalized service lines. These are the parts of the business that do not align with the stated megatrends of water, life sciences, advanced manufacturing, and critical infrastructure. These units are candidates for divestiture or minimal investment.

Here's a look at the segment composition that frames the portfolio shift away from the Dogs:

The imperative for these units is clear: avoid expensive turn-around plans and minimize cash consumption. The focus should be on maximizing the cash generated from these units before divestiture or allowing them to naturally wind down if they do not meet internal hurdle rates.

The characteristics defining these Dog-like activities in Jacobs Solutions Inc. (J) for 2025 include:

• Legacy engineering and construction contracts with low margins.
• Exposure to cyclical capital spending patterns.
• Service lines lacking linkage to digital transformation initiatives.
• Specific environmental consulting sub-segments facing private sector uncertainty.

The company's total backlog stood at $23.1 Billion as of the end of Q3 FY25, which provides a buffer, but the strategic goal is to ensure future bookings are heavily weighted toward the high-growth, high-margin areas, effectively starving the Dogs of new, long-term investment.

Jacobs Solutions Inc. (J) - BCG Matrix: Question Marks

You're hiring before product-market fit, which is exactly where these business units sit. They are in markets that are clearly growing-like digital transformation and advanced technology-but Jacobs Solutions Inc.'s current market share, as represented by their revenue contribution, is small compared to the core business.

Retained Divergent Solutions (DVS) digital/data platforms represent a classic Question Mark. While the company reorganized its segments after the 2024 Separation Transaction, the remaining DVS businesses, focused on technology-enhanced and artificial intelligence solutions, require significant capital deployment to scale against established digital players. For fiscal year 2025, the reported revenue for Divergent Solutions was approximately $946.91 million, which is a small fraction of the total operations, indicating a low current market share in the high-growth digital space. Jacobs Solutions Inc. is actively investing, evidenced by the launch of Jacobs University to expand training in AI and digital skills across the firm.

The company's focus on new, nascent high-tech niches, such as quantum computing facility design, clearly fits the high-risk, high-reward profile. Jacobs Solutions Inc. is playing a pivotal role in building one of the world's first utility-scale, fault-tolerant quantum computers through its partnership with PsiQuantum in Brisbane, Australia. This type of specialized, first-mover project demands heavy, upfront investment in expertise and design services, consuming cash without immediate, large-scale returns, but holding the potential to become a future Star segment.

AI-enabled offerings are being pushed forward, with the CEO highlighting strategic partnerships with NVIDIA/Palantir and emphasizing AI/digital investments in the post-earnings commentary. These offerings, which include areas like the mentioned Aqua DNA concept (though specific revenue for this is not itemized), are positioned in markets with secular tailwinds. The overall outlook for growth is strong, with fiscal 2026 adjusted net revenue guidance set between 6% to 10% growth, suggesting these growth areas are expected to accelerate.

While specific data on new geographic expansion into less mature markets is not broken out separately, the overall backlog growth and focus on global challenges like infrastructure and energy suggest such efforts are ongoing. The consolidated backlog reached a record $23.1 billion as of the end of fiscal 2025, providing the foundation for future revenue, including from these expanding territories.

Here's a look at the relative revenue scale of the key business units in fiscal year 2025, illustrating the low market share of the non-core, high-growth areas:

These Question Marks require a decision on heavy investment to capture market share quickly or divestiture. The current strategy appears to favor investment, given the record backlog and focus on digital/AI.

• Retained DVS digital/data platforms revenue in FY 2025: $946.91 Million.
• Infrastructure & Advanced Facilities (I&AF) revenue in FY 2025: $10.76 Billion.
• Total Gross Revenue for FY 2025: $12.0 Billion.
• FY 2026 Adjusted Net Revenue Growth Guidance: 6% to 10%.
• Capital returned to shareholders in FY 2025: A record $1.1 billion.
• The company is expanding its position in high-end advisory services with its partner, PA Consulting, which generated $1.27 Billion in revenue in FY 2025.