Limbach Holdings, Inc. (LMB): PESTLE Analysis [Nov-2025 Updated]

You're looking at Limbach Holdings, Inc. and trying to figure out if their strong near-term visibility, backed by a backlog exceeding $1.1 billion in 2025 filings, is enough to offset the macro-pressures. Honestly, it's a tightrope walk. Federal infrastructure spending is a massive tailwind, but it's constantly battling high interest rates that slow new commercial development and an acute shortage of skilled tradespeople. We need to map out how political mandates, economic volatility, and the defintely necessary shift to modular construction will actually impact their margins and long-term strategy. Let's dive into the PESTLE breakdown.

Limbach Holdings, Inc. (LMB) - PESTLE Analysis: Political factors

Increased federal infrastructure spending drives demand for large-scale MEP projects

The current political environment, characterized by significant federal spending legislation, is a major tailwind for Limbach Holdings, Inc. (LMB). Acts like the Infrastructure Investment and Jobs Act (IIJA), the CHIPS Act, and the Inflation Reduction Act (IRA) are funneling trillions of dollars into domestic projects, directly boosting demand in Limbach's core mission-critical markets.

For example, the manufacturing revival alone has seen companies announce over $1.2 trillion in planned advancements toward expanding U.S. production capacity in 2025, primarily in semiconductors, electronics, and pharmaceuticals. These massive industrial and manufacturing complexes, along with new Data Centers, require extensive Mechanical, Electrical, and Plumbing (MEP) systems, which is Limbach's specialty. We are defintely seeing this demand reflected in the company's strong guidance.

Here's the quick math on the expected scale: Limbach reaffirmed its full-year 2025 revenue guidance to be between $650 million and $680 million, a target heavily supported by this secular demand in their key verticals. This is a clear opportunity to secure high-value, long-term Owner Direct Relationships (ODR) contracts.

State-level permitting and regulatory approval processes create project timeline uncertainty

While federal money is flowing, the actual execution of projects is often bottlenecked by state and local regulatory hurdles, creating project timeline uncertainty. This is a real risk for contractors who rely on predictable schedules for cash flow and resource management.

In regions where Limbach operates, such as Pennsylvania, permit processing times have increased by as much as 45% compared to 2023, leading to substantial financial implications for stakeholders. This kind of delay exposes projects to further inflation risk and can tie up Limbach's skilled labor longer than planned. To be fair, this isn't a new issue, but the sheer volume of new construction projects is exacerbating the problem, pushing some project delays out by over a year in some cases.

Limbach mitigates this risk by focusing its business on the higher-margin ODR segment, which is less reliant on the volatile General Contractor Relationships (GCR) new construction market. Still, a delayed project is a delayed payment.

Trade tariffs on steel and other construction materials impact project costs and margins

The political decision to impose and increase trade tariffs is a direct hit to the cost of goods sold for any MEP contractor. The materials Limbach uses-steel, aluminum, copper, and specialized HVAC and plumbing components-are all subject to this volatility.

For instance, U.S. tariffs on steel and aluminum imports increased from 25% to 50% in June 2025, dramatically raising the input cost for everything from structural supports to ductwork. The average U.S. trade-weighted tariff rate was already sitting at 8.1% in March 2025 and is broadly assumed to peak at 12% if all proposed tariffs are enacted this year.

You can see the impact on profitability in the 2025 results. Limbach's Q3 2025 ODR gross margin was 24.2%, a slight compression from the previous year, which is partly attributable to material cost pressure from tariffs and supply chain issues. This is why cost escalation clauses in contracts are more critical than ever.

Government contracts, particularly defense or federal facility work, offer stable revenue streams

While Limbach strategically focuses on private sector building owners, its inclusion of 'Government' as a key end market provides a stable, if smaller, revenue stream that is often less susceptible to private economic cycles.

Government facility maintenance, defense, and other federal contracts typically fall into the General Contractor Relationships (GCR) segment or are secured as ODR work with government entities. For the nine months ended September 30, 2025, Limbach's GCR segment generated $119.2 million in revenue. This work is generally long-term and recurring, but it comes with its own political risks.

The primary risk here is political instability. Limbach has disclosed that potential U.S. government shutdowns or delays in federal appropriations could adversely affect its operations by suspending or delaying contracts and payments. You need to be aware of the trade-off:

• Benefit: Stable, long-term facility maintenance contracts.
• Risk: Exposure to federal budget battles and government shutdowns.

The company's success is tied to its mix shift, which is heavily weighted toward the more profitable ODR segment, representing 76.6% of Q3 2025 revenue, insulating it somewhat from the GCR segment's volatility, including government contract risk.

Finance: Assess all active GCR contracts for cost-escalation clause exposure to the 50% steel tariff by the end of the quarter.

Limbach Holdings, Inc. (LMB) - PESTLE Analysis: Economic factors

You're looking at Limbach Holdings, Inc. (LMB) and wondering how the current economic headwinds-especially high interest rates-will hit a company that still has a construction arm. The direct takeaway is that LMB's strategic shift to its less-cyclical service business is providing a critical buffer, but margin pressure is a real, near-term concern.

High interest rates continue to dampen new commercial real estate development starts.

The Federal Reserve's sustained high interest rates have defintely cooled the commercial real estate (CRE) sector, which is the primary driver of the General Contractor Relationships (GCR) segment, Limbach's traditional construction business. When borrowing costs are high, developers postpone new builds, and that slows down new project starts.

We saw this impact directly in the third quarter of 2025, where the GCR segment's organic revenue actually decreased by 19.5% year-over-year. This decline is a clear signal that the market for large, new construction projects is shrinking as financing tightens. That segment's revenue was only $43.2 million in Q3 2025, showing its diminishing role in the overall business.

LMB's Service segment, which is less cyclical, provides a stable revenue base against construction volatility.

This is where Limbach's strategic pivot to Owner Direct Relationships (ODR), essentially their recurring service and maintenance segment, pays off. This segment is far less sensitive to interest rate hikes because its work-like maintaining critical infrastructure in hospitals and data centers-is non-discretionary. You can't defer a broken HVAC system in a hospital.

In the third quarter of 2025, ODR revenue hit $141.4 million, accounting for 76.6% of total revenue. Management is guiding for full-year 2025 organic ODR revenue growth to be strong, in the range of 20% to 25%. This segment is the company's anchor in a choppy economic sea.

Here's the quick math on the segment mix for Q3 2025:

Inflationary pressure on labor and material costs squeezes gross profit margins.

Even with the shift to higher-margin ODR work, the company is not immune to the inflationary environment, plus they have integration challenges. Total gross margin dropped to 24.2% in Q3 2025, down from 27.0% in the prior year period.

What this estimate hides is that the bulk of this drop is due to the recent acquisition of Pioneer Power, which carries a lower gross margin profile than Limbach's historical average. Still, the underlying pressure from higher wages and volatile material costs (like copper or steel) means new contracts need to be priced perfectly to maintain profitability, especially in the GCR segment. Management is focused on improving Pioneer Power's margins to align with the rest of the business over time.

Strong backlog of work provides near-term revenue visibility.

Despite the slowdown in new GCR starts, the company has solid revenue visibility from its existing commitments. As of September 30, 2025, the total remaining performance obligations (backlog) stood at $492.7 million.

A closer look shows the quality of this backlog, which is key:

• ODR Backlog: $241.6 million.
• GCR Backlog: $121.2 million.

The ODR backlog is significantly higher than the GCR backlog, reinforcing the stability of the company's future revenue stream. This backlog figure, combined with the full-year 2025 revenue guidance of between $650 million and $680 million, provides a clear line of sight for the next few quarters.

Limbach Holdings, Inc. (LMB) - PESTLE Analysis: Social factors

You need to understand that social dynamics are hitting Limbach Holdings, Inc. (LMB) right at its cost structure and its project pipeline, so the core takeaway is simple: the acute skilled labor shortage is the biggest near-term risk, but the growing demand for green building is the clearest long-term opportunity for profitability.

Limbach operates in a sector-Mechanical, Electrical, and Plumbing (MEP) construction-that is highly sensitive to workforce availability and client expectations. The structural issues of an aging workforce and the cultural shift toward sustainability are creating a tough environment, but they also reward companies that can adapt fast with technology and specialization. This isn't just about finding workers; it's about managing wage inflation while capturing higher-margin green projects. Honestly, the labor market is defintely the primary pressure point right now.

Acute shortage of skilled tradespeople (plumbers, pipefitters, electricians) drives up labor costs.

The biggest financial headwind for Limbach is the persistent, structural labor shortage. The U.S. construction industry must attract an estimated 439,000 net new workers in 2025 just to meet anticipated demand, and nearly nine out of ten contractors report difficulty finding qualified tradespeople, especially in skilled areas like plumbing and electrical.

This supply/demand imbalance directly impacts your bottom line. Combined hourly billable labor costs for commercial reconstruction increased by 4.49% from October 2024 to October 2025, outpacing material cost increases and forming the most significant component of overall cost inflation. The average hourly earnings for construction workers reached $38.76 in March 2025, a 4.5% year-over-year increase, which is great for the workers but compresses margins if not managed through higher-value contracts.

Here's the quick math: the aggregate economic impact of this shortage, primarily through longer construction times, is estimated at an staggering $10.806 billion per year across the industry. Limbach must mitigate this by focusing on its higher-margin Owner Direct Relationship (ODR) business, which is less exposed to the competitive bid market where labor cost spikes are hardest to pass on.

Growing public and client demand for sustainable, green building practices influences project design.

The shift toward sustainable, green building is no longer a niche trend; it's a market mandate and a clear opportunity for a specialized MEP firm like Limbach. The global green buildings market size is estimated to hit around $618.58 billion in 2025, and it's projected to grow at a Compound Annual Growth Rate (CAGR) of 9.29% through 2034.

Clients are driven by clear financial incentives, not just environmental ones. Owners report an average operating cost savings of 10.5% in the first year for new green buildings, which makes the higher upfront cost of specialized MEP systems an easy sell on a net present value basis. Limbach's expertise in designing and implementing energy-efficient systems, integrating renewable energy, and meeting certifications like LEED is critical here. This is where you find the higher-margin work.

Generational shift in the workforce requires investment in digital tools and remote collaboration.

The construction workforce is aging out rapidly, with more than 20% of the current labor pool over the age of 55 and nearing retirement. To replace these experienced tradespeople, the industry needs to add over 500,000 workers by the end of 2025.

The younger Generation Z (Gen Z) workers are digital natives who expect technology on the job site. They are quicker to adopt Artificial Intelligence (AI) and other emerging technologies. For Limbach, this means the generational shift is also a technological imperative. Digital adoption has reached 77% during the construction and design phases, and Building Information Modeling (BIM) adoption is at 69%, making it the essential backbone of modern project workflows.

To attract and retain this new talent, Limbach must invest in the tools that enable better collaboration and efficiency:

• Integrate BIM models for real-time, shared project data.
• Provide mobile-first tools for site-to-office communication.
• Leverage AI for design optimization and risk assessment (used by three-quarters of AEC professionals).
• Offer clear career paths with tech-focused upskilling.

Focus on diversity and inclusion in contracting and workforce composition becomes a client requirement.

The social landscape for Diversity and Inclusion (D&I) in contracting became complex in 2025 due to a January 21, 2025, Executive Order (EO) that revoked previous EOs mandating affirmative action for federal contractors, including the long-standing EO 11246. This shifts the federal compliance focus from proactive affirmative action reporting to a more reactive, complaint-driven enforcement of anti-discrimination laws.

However, while the federal mandate has changed, the social and commercial demand from private clients-especially large corporate customers in Limbach's target ODR market-for diverse suppliers and workforce composition remains a key factor. Many private sector contracts and state/local government projects continue to prioritize supplier diversity. Limbach must navigate this dual reality: ensuring its programs comply with the new federal certification requirement while still prioritizing diversity to attract the next generation of workers and satisfy major corporate client social governance demands.

Limbach Holdings, Inc. (LMB) - PESTLE Analysis: Technological factors

You need to know how Limbach Holdings, Inc. is using technology not just to keep pace, but to drive their higher-margin Service segment. The key takeaway is that their strategic investment in proprietary software and off-site manufacturing is directly fueling their Owner Direct Relationships (ODR) growth, which increased by a massive 31.7% in the second quarter of 2025 to $108.9 million. That's where the real value is being created.

Increased adoption of Building Information Modeling (BIM) mandates efficiency in design and coordination.

Limbach Holdings, Inc. has long integrated Building Information Modeling (BIM)-the process of creating and managing digital representations of physical and functional characteristics of places-into its core workflow. This isn't just a buzzword; it's a necessary step to manage complex mechanical, electrical, and plumbing (MEP) systems efficiently. They even use their own in-house estimating platform, the Limbach Modeling and Production System (LMPS), which they launched back in 2011. This proprietary tool gives them a competitive edge by providing real-time cost analysis and labor-management feedback during the design phase, which is defintely critical for maintaining their profit margins.

The use of BIM is non-negotiable for modern construction. It allows for better clash detection and coordination before a single component is built, reducing costly rework on-site. This technological discipline is central to their ability to execute on their full-year 2025 Revenue Guidance of $650 million to $680 million.

Prefabrication and modular construction techniques reduce on-site labor time and improve quality control.

Prefabrication, or offsite construction, is a major pillar of Limbach Holdings, Inc.'s strategy, especially for their General Contractor Relationships (GCR) work. By fabricating complex components like pipe racks, ductwork, and modular plants in a controlled shop environment-what they call Offsite Construction-they mitigate weather delays, improve worker safety, and boost quality control.

Here's the quick math: Industry data shows that prefabrication can reduce construction costs by up to 20% and accelerate project completion by 20% to 50%. For a mission-critical project like the Mount Carmel New Albany Steam Plant Expansion, Limbach Holdings, Inc. prefabricated an entire 60,000 lb, 50-foot-long steam plant offsite, saving months on the project schedule for a healthcare client. That's a concrete example of technology delivering tangible value.

Use of drones and digital tools for site surveys and progress monitoring improves project management.

While the term 'drone' isn't always front-and-center, the company's embrace of digital reality capture is clear. Limbach Holdings, Inc. explicitly lists Scanning Services as part of their Virtual Design and Construction offering. This means they use digital tools, like 3D scanners or high-resolution cameras (often drone-mounted), to capture site conditions and monitor progress in real-time. This digital feedback loop is essential for connecting the BIM model with the actual job site, a process that minimizes errors and keeps their large-scale projects on track.

This focus on digital site management is a key differentiator in a fragmented industry, helping them manage their workforce of over 1,600 team members across 21 offices more effectively.

Investment in proprietary software to optimize Service segment scheduling and dispatch is a competitive advantage.

This is where Limbach Holdings, Inc. is truly leaning into technology to secure their higher-margin, recurring revenue stream. Their proprietary platform for the Service segment (ODR) is called Limbach Insights. This is not just a scheduling tool; it's a data-driven solution that integrates Artificial Intelligence (AI) and Internet of Things (IoT) technology to provide facility analytics.

The platform is a competitive advantage because it shifts the business model from reactive repair to predictive maintenance. They even partner with a connected building platforms provider, Facilio, to integrate Fault Detection and Diagnostics (FDD) into their services. This allows them to automate work orders and reduce the risk of unexpected downtime for customers, which is the ultimate value proposition in mission-critical environments like data centers and hospitals.

The table below summarizes the core technological tools driving the company's two main segments, which is key to understanding how they expect to hit their 2025 Adjusted EBITDA guidance of $80 million to $86 million.

Action: Finance should quantify the estimated labor hour reduction from prefabrication on the next five largest GCR projects to validate the 20% cost savings estimate.

Limbach Holdings, Inc. (LMB) - PESTLE Analysis: Legal factors

You are right to focus on the legal landscape; it's where operational risk gets codified into real financial exposure. For a specialty contractor like Limbach Holdings, Inc., the legal environment in 2025 is defined by rising compliance costs, especially around safety and labor, and the ever-present challenge of managing contractual liabilities on complex projects.

Stricter Occupational Safety and Health Administration (OSHA) standards increase compliance and training costs.

The Occupational Safety and Health Administration (OSHA) is significantly tightening its focus on the construction industry in 2025, which directly increases Limbach's compliance and training burden. These new rules are not just minor tweaks; they require capital investment in equipment and administrative overhead for documentation.

One major change is the new Personal Protective Equipment (PPE) fit requirement, effective January 13, 2025, which mandates that all PPE must properly fit each worker, recognizing the increasingly diverse workforce. Also, the agency is increasing its financial bite for non-compliance. For 2025, the maximum penalty for a Serious violation has risen to $16,550 per incident, and a Willful or Repeated violation can cost up to $165,514 per violation.

Beyond the immediate fines, Limbach must also contend with new, complex health-related rules:

• Heat Illness Prevention: A pending rule is expected to mandate provisions like shaded rest areas, hydration, and defined rest breaks when temperatures exceed certain thresholds, impacting summer productivity and site logistics.
• Lead Exposure: States like California (Cal/OSHA) are enforcing stricter limits starting January 1, 2025, with the Permissible Exposure Limit (PEL) decreasing significantly from 50 micrograms per cubic meter to 10.
• Mental Health: OSHA is expanding its safety definition to include mental health programs, acknowledging the construction industry's high suicide rates, which requires new training and program development.

Proactive documentation and digital safety solutions are no longer optional-they are essential to avoid these steep penalties. Compliance is a business strategy, not just a regulatory checkmark.

Changes to prevailing wage laws on federally funded projects affect labor costs and bidding strategy.

Prevailing wage laws, like the federal Davis-Bacon Act (DBA), are seeing expanded enforcement and rising rates in 2025, which directly impacts Limbach's labor costs and its competitive bidding on public works projects. The federal contractor minimum wage, for instance, increased from $17.20 per hour to $17.75 per hour on January 1, 2025.

This rise in mandated wages, combined with stricter enforcement and new state-level updates, forces a significant administrative lift for certified payroll reporting and compliance. For non-union contractors, the administrative complexity of navigating the extensive rate schedules (sometimes equating to thousands of pages of classifications, as seen in some states) and the risk of steep penalties (up to $5,000 per violation plus a 10% penalty in some jurisdictions) can be a deterrent to bidding on public work entirely.

Limbach must factor this increased labor and compliance overhead into its General Contractor Relationships (GCR) segment bids, which, as of Q3 2025, accounted for 19% of total revenue. The company's strategy to pivot toward higher-margin Owner Direct Relationships (ODR) is partly a risk mitigation move against the volatility and complexity of the GCR segment.

Complex multi-state licensing and bonding requirements for MEP contractors create administrative overhead.

Operating across 21 offices in the eastern United States means Limbach faces a patchwork of state-specific licensing, insurance, and surety bond requirements that create substantial administrative overhead and capital commitment. This isn't a one-and-done process; it's a continuous, expensive compliance cycle.

The financial impact of this regulatory complexity is concrete, as seen in 2025 state-level changes:

• Oregon's contractor license fee is increasing to $400 effective July 1, 2025.
• In New Jersey, new surety bond requirements for contractors mean businesses with annual services totaling $750,000 or more must secure a $50,000 bond.
• California requires a contractor license bond of $25,000 (increased in 2023), and specific trades like HVAC and electrical must now complete continuing education as part of their renewal.

Here's the quick math: managing hundreds of licenses, each with unique training, fee, and bond requirements, across multiple states is a drain on administrative resources. This complexity is a barrier to entry for smaller competitors, but for Limbach, it's a constant, non-negotiable operating cost.

Contractual risk management becomes crucial due to fixed-price contracts and material price volatility.

Limbach's business model involves both Owner Direct Relationships (ODR), which often use time-and-materials or performance contracts, and General Contractor Relationships (GCR), which are typically fixed-price contracts. The fixed-price model, while attractive to customers, means Limbach bears the primary risk of cost overruns.

In a period of unpredictable material price volatility, this risk is amplified. If the cost of copper, steel, or specialized HVAC equipment rises unexpectedly between the bid date and the procurement date, the company's gross margin is directly eroded. Limbach's total gross margin for Q3 2025 was 24.2%, down from 27.0% in Q3 2024, partly due to lower margins from a recent acquisition, but also highlighting the vulnerability to margin compression.

To mitigate this legal and financial exposure, Limbach relies on robust internal cost review procedures and its proprietary Building Information Modeling (BIM) system, the Limbach Modeling and Production System (LMPS), to create more accurate cost estimates and reduce the risk of cost overruns on fixed-price work.

The strategic shift to ODR, which represented 76.6% of total revenue in Q3 2025, is a deliberate move to reduce reliance on the higher-risk, fixed-price GCR projects and enhance overall margin consistency.

Finance: Review Q4 2025 GCR project pipeline for material cost escalation clauses and confirm all new OSHA-mandated training costs are budgeted by year-end.

Limbach Holdings, Inc. (LMB) - PESTLE Analysis: Environmental factors

You need to understand how environmental regulations and client sustainability demands are reshaping the mechanical, electrical, and plumbing (MEP) sector, because they are creating a massive, high-margin opportunity for Limbach Holdings, Inc. (LMB), especially within its Owner Direct Relationships (ODR) segment. This isn't just about compliance; it's about a fundamental shift in building system complexity that favors a solutions-oriented firm.

Stricter energy efficiency codes (e.g., updated ASHRAE standards) necessitate advanced HVAC and control systems.

The push for building decarbonization is real, and it's accelerating. New standards from the American Society of Heating, Refrigerating and Air-Conditioning Engineers (ASHRAE) are moving beyond simple energy efficiency to mandate emissions performance. For example, the ANSI/ASHRAE/IES Standard 100-2024 now includes new metrics for establishing greenhouse gas emissions targets for existing buildings, requiring owners to establish an energy management plan and incorporate efficient, low-carbon equipment into capital replacement cycles.

This is a direct tailwind for Limbach Holdings, Inc.'s ODR business, which focuses on upgrading and maintaining mission-critical systems for building owners. When a building's HVAC system needs to be replaced to meet a new code, it becomes a complex, high-value project. The commercial segment of the U.S. clean energy market, which includes these efficiency upgrades, is forecast to be the fastest-growing, with a projected Compound Annual Growth Rate (CAGR) of 9.1% from 2024 to 2033. Limbach's expertise in engineering and integrated solutions makes them a primary beneficiary of this trend.

Client demand for LEED (Leadership in Energy and Environmental Design) and Net-Zero energy buildings drives system complexity.

Honestly, client demand for green buildings is now a financial imperative, not just a marketing one. Building owners are chasing the lower operating costs and higher asset valuations that come with certifications like LEED and the ultimate goal of Net-Zero energy. The global Net-Zero Energy Buildings market size was valued at $60.21 billion in 2025 and is projected to grow at a CAGR of over 17.2% through 2035.

This demand directly translates into more sophisticated, integrated MEP systems-think smart controls, geothermal heat pumps, and advanced air quality systems. Limbach Holdings, Inc. is positioned well here, as their ODR model thrives on this complexity. The company's focus on this segment has been strategic, with ODR revenue reaching a quarterly record of $108.9 million in Q2 2025, and projected to represent 70% to 80% of total revenue for the full year 2025.

• Net-Zero/LEED projects require high-efficiency HVAC, which is Limbach's core strength.
• New standards like ASHRAE Standard 228-2023 provide a framework for zero energy and zero carbon building evaluation.
• The complexity of these systems ensures recurring, high-margin service work.

Regulations on refrigerants (HFC phase-down) require investment in new, compliant cooling technologies.

The U.S. Environmental Protection Agency (EPA) is phasing down hydrofluorocarbons (HFCs), which are potent greenhouse gases, under the American Innovation and Manufacturing (AIM) Act. This is a critical near-term action item for all building owners. Starting January 1, 2025, the manufacturing or importing of new comfort cooling systems with a Global Warming Potential (GWP) of 700 or greater is prohibited.

This means building owners must transition from older refrigerants like R-410A to newer, low-GWP alternatives, such as R-32 and R-454B, which often requires significant system modification or replacement. This HFC phase-down is expected to boost the industrial HVAC market by $6.81 billion from 2025-2029. For Limbach Holdings, Inc., this is a clear-cut opportunity to provide high-value, non-discretionary replacement and retrofit services to their ODR clients.

Increased scrutiny on construction waste management and recycling practices by local authorities.

While Limbach Holdings, Inc.'s primary business is systems, they still operate within the construction and renovation ecosystem, meaning they must comply with increasingly stringent construction and demolition (C&D) waste rules. The C&D waste management market is expected to reach $8.78 billion by 2025 in the US, growing at a CAGR of 5.92% through 2030, which shows the scale of the problem and the opportunity for specialized services.

Local jurisdictions are getting tough. Cities like Denver have implemented 'Waste No More' ordinances mandating detailed recycling and reuse plans for demolition projects. For Limbach Holdings, Inc., this means their General Contractor Relationships (GCR) segment must be defintely disciplined in waste segregation and documentation. The good news is that proper recycling can recover up to 70% of demolition waste, which can lower disposal costs and create a competitive advantage for the GCR segment.

Here's the quick math: With full-year 2025 revenue guidance of up to $680 million, every efficiency gain in project execution, including waste management, directly impacts the bottom line. The strategic focus on ODR, which has higher margins and less exposure to large-scale demolition waste than GCR, mitigates the risk of these new, complex C&D regulations.