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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2025

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-07782

Parsons Corporation

(Exact Name of Registrant as Specified in its Charter)


Delaware	95-3232481
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

14291 Park Meadow Drive, Suite 100 Chantilly, Virginia	20151
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (703) 988-8500

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class

     Trading
Symbol(s)

     Name of each exchange on which registered

     Common Stock, $1 par value

     PSN

     New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of October 20, 2025, the registrant had 106,488,582 shares of common stock, $1.00 par value per share, outstanding.

Table of Contents


		Page
PART I.	FINANCIAL INFORMATION	1
Item 1.	Financial Statements (Unaudited)	1
	Consolidated Balance Sheets	1
	Consolidated Statements of Income	2
	Consolidated Statements of Comprehensive Income	3
	Consolidated Statements of Cash Flows	4
	Consolidated Statements of Shareholders’ Equity	5
	Notes to Unaudited Consolidated Financial Statements	7
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	37
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	51
Item 4.	Controls and Procedures	52
PART II.	OTHER INFORMATION	53
Item 1.	Legal Proceedings	53
Item 1A.	Risk Factors	53
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	53
Item 3.	Defaults Upon Senior Securities	53
Item 4.	Mine Safety Disclosures	54
Item 5.	Other Information	54
Item 6.	Exhibits	54
	Signatures	55

PART I—FINANCIAL INFORMATION

Item 1. Financial Statements.

PARSONS CORPORATION AND SUBSIDIARIES

Consolidated Balance Sheets

(in thousands, except share information)


		September 30, 2025			December 31, 2024
		(Unaudited)
Assets
Current assets:
	Cash and cash equivalents (including $91,469 and $202,121 Cash of consolidated joint ventures)	$	422,554		$	453,548
	Accounts receivable, net (including $397,196 and $294,700 Accounts receivable of consolidated joint ventures)		1,223,904			1,100,396
	Contract assets (including $9,197 and $7,906 Contract assets of consolidated joint ventures)		822,487			741,504
	Prepaid expenses and other current assets (including $17,208 and $14,723 Prepaid expenses and other current assets of consolidated joint ventures)		180,100			166,952
	Total current assets		2,649,045			2,462,400

	Property and Equipment, net (including $2,800 and $2,971 Property and equipment of consolidated joint ventures)		125,867			111,575
	Right of use assets, operating leases (including $4,208 and $5,726 Right of use assets, operating leases of consolidated joint ventures)		133,535			153,048
	Goodwill		2,163,469			2,082,680
	Investments in and advances to unconsolidated joint ventures		156,421			138,759
	Intangible assets, net		339,426			349,937
	Deferred tax assets		106,921			133,450
	Other noncurrent assets		62,033			56,113
	Total assets	$	5,736,717		$	5,487,962

Liabilities and Shareholders' Equity
Current liabilities:
	Accounts payable (including $36,515 and $28,214 Accounts payable of consolidated joint ventures)	$	271,415		$	207,589
	Accrued expenses and other current liabilities (including $213,246 and $198,797 Accrued expenses and other current liabilities of consolidated joint ventures)		912,138			894,425
	Contract liabilities (including $57,327 and $66,144 Contract liabilities of consolidated joint ventures)		343,509			289,799
	Short-term lease liabilities, operating leases (including $2,516 and $3,522 Short-term lease liabilities, operating leases of consolidated joint ventures)		49,514			52,725
	Income taxes payable		11,375			7,701
	Short Term Debt		-			463,405
	Total current liabilities		1,587,951			1,915,644

	Long-term employee incentives		29,838			31,818
	Long-term debt		1,236,700			784,096
	Long-term lease liabilities, operating leases (including $1,689 and $2,203 Long-term lease liabilities, operating leases of consolidated joint ventures)		97,673			114,386
	Deferred tax liabilities		17,665			11,043
	Other long-term liabilities		102,250			96,486
	Total liabilities	$	3,072,077		$	2,953,473
Contingencies (Note 12)
Shareholders' equity:
	Common stock, $1 par value; authorized 1,000,000,000 shares; 146,368,908 and 146,656,225 shares issued; 55,535,089 and 52,657,447 public shares outstanding; 50,952,945 and 54,117,904 ESOP shares outstanding	$	146,369		$	146,655
	Treasury stock, 39,880,875 shares at cost		(815,282	)		(815,282	)
	Additional paid-in capital		2,645,230			2,684,829
	Retained earnings		605,795			426,781
	Accumulated other comprehensive loss		(24,282	)		(26,594	)
	Total Parsons Corporation shareholders' equity		2,557,830			2,416,389
	Noncontrolling interests		106,810			118,100
	Total shareholders' equity		2,664,640			2,534,489
	Total liabilities and shareholders' equity	$	5,736,717		$	5,487,962

The accompanying notes are an integral part of these consolidated financial statements.

PARSONS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Income

(In thousands, except per share information)

(Unaudited)


	Three Months Ended						Nine Months Ended
	September 30, 2025			September 30, 2024			September 30, 2025			September 30, 2024
Revenue	$	1,621,748		$	1,810,116		$	4,760,431		$	5,016,259
Direct cost of contracts		1,261,893			1,449,831			3,698,240			3,979,589
Equity in earnings (losses) of unconsolidated joint ventures		8,266			872			6,937			(18,025	)
Selling, general and administrative expenses		260,166			246,169			756,279			690,391
Operating income		107,955			114,988			312,849			328,254
Interest income		1,839			4,232			5,049			9,209
Interest expense		(13,535	)		(13,034	)		(38,350	)		(39,040	)
Convertible debt repurchase loss		-			-			-			(18,355	)
Other income (expense), net		1,570			1,921			8,224			(510	)
Total other income (expense)		(10,126	)		(6,881	)		(25,077	)		(48,696	)
Income before income tax expense		97,829			108,107			287,772			279,558
Income tax expense		(16,035	)		(22,518	)		(53,702	)		(58,257	)
Net income including noncontrolling interests		81,794			85,589			234,070			221,301
Net income attributable to noncontrolling interests		(17,671	)		(13,638	)		(48,514	)		(40,428	)
Net income attributable to Parsons Corporation	$	64,123		$	71,951		$	185,556		$	180,873
Earnings per share:
Basic	$	0.60		$	0.68		$	1.74		$	1.70
Diluted	$	0.59		$	0.65		$	1.69		$	1.64

The accompanying notes are an integral part of these consolidated financial statements.

PARSONS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Comprehensive Income

(In thousands)

(Unaudited)


	Three Months Ended						Nine Months Ended
	September 30, 2025			September 30, 2024			September 30, 2025			September 30, 2024
Net income including noncontrolling interests	$	81,794		$	85,589		$	234,070		$	221,301
Other comprehensive income, net of tax
Foreign currency translation adjustment, net of tax		(4,946	)		2,977			3,522			(1,195	)
Pension adjustments, net of tax		(1,275	)		23			(1,206	)		(24	)
Comprehensive income including noncontrolling interests, net of tax		75,573			88,589			236,386			220,082
Comprehensive income attributable to noncontrolling interests, net of tax		(17,671	)		(13,641	)		(48,514	)		(40,443	)
Comprehensive income attributable to Parsons Corporation, net of tax	$	57,902		$	74,948		$	187,872		$	179,639

The accompanying notes are an integral part of these consolidated financial statements.

PARSONS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Cash Flows

(In thousands)

(Unaudited)


		For the Nine Months Ended
		September 30, 2025			September 30, 2024
Cash flows from operating activities:
	Net income including noncontrolling interests	$	234,070		$	221,301
	Adjustments to reconcile net income to net cash used in operating activities
	Depreciation and amortization		85,844			73,513
	Amortization of debt issue costs		3,834			6,563
	Loss (gain) on disposal of property and equipment		187			573
	Convertible debt repurchase loss		-			18,355
	Deferred taxes		27,841			(1,015	)
	Foreign currency transaction gains and losses		(5,327	)		898
	Equity in losses of unconsolidated joint ventures		(6,937	)		18,025
	Return on investments in unconsolidated joint ventures		26,562			31,770
	Stock-based compensation		32,726			39,960
	Contributions of treasury stock		54,023			43,372
	Changes in assets and liabilities, net of acquisitions and consolidated joint ventures:
	Accounts receivable		(90,740	)		(116,468	)
	Contract assets		(70,659	)		(29,597	)
	Prepaid expenses and other assets		(17,249	)		32,884
	Accounts payable		45,365			56,665
	Accrued expenses and other current liabilities		(47,559	)		25,654
	Contract liabilities		39,497			343
	Income taxes		3,713			(3,354	)
	Other long-term liabilities		(4,327	)		(22,602	)
	Net cash provided by operating activities		310,864			396,840
Cash flows from investing activities:
	Capital expenditures		(36,030	)		(30,446	)
	Proceeds from sale of property and equipment		35			128
	Payments for acquisitions, net of cash acquired		(118,294	)		(198,875	)
	Investments in unconsolidated joint ventures		(62,383	)		(115,446	)
	Return of investments in unconsolidated joint ventures		28,358			25
	Net cash used in investing activities		(188,314	)		(344,614	)
Cash flows from financing activities:
	Proceeds from borrowings under credit agreement		243,700			153,200
	Repayments of borrowings under credit agreement		(243,700	)		(153,200	)
	Proceeds from issuance of convertible notes due 2029		-			800,000
	Repurchases of convertible notes due 2025		(113,405	)		(495,590	)
	Proceeds from term loan		450,000			-
	Repayment of delayed draw term loan		(350,000	)		-
	Payments for debt issuance costs		(2,571	)		(19,185	)
	Contributions by noncontrolling interests		1,503			1,038
	Distributions to noncontrolling interests		(62,827	)		(29,006	)
	Repurchases of common stock		(64,994	)		(10,000	)
	Taxes paid on vested stock		(18,958	)		(19,228	)
	Capped call transactions		-			(88,400	)
	Bond hedge termination		-			195,549
	Redemption of warrants		-			(104,952	)
	Proceeds from issuance of common stock		4,796			3,740
	Net cash (used in) provided by financing activities		(156,456	)		233,966
	Effect of exchange rate changes		2,912			(312	)
	Net increase (decrease) in cash, cash equivalents, and restricted cash		(30,994	)		285,880
	Cash, cash equivalents and restricted cash:
	Beginning of year		453,548			272,943
	End of period	$	422,554		$	558,823

The accompanying notes are an integral part of these consolidated financial statements.

PARSONS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Shareholders’ Equity

For the Three Months Ended September 30, 2025 and September 30, 2024

(In thousands)

(Unaudited)


	Common Stock			Treasury Stock			Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Total Parsons Equity			Noncontrolling Interests			Total
Balance at June 30, 2025	$	146,676		$	(815,282	)	$	2,660,579		$	541,965		$	(18,067	)	$	2,515,871		$	105,740		$	2,621,611
Net income		-			-			-			64,123			-			64,123			17,671			81,794
Foreign currency translation loss, net		-			-			-			-			(4,940	)		(4,940	)		(6	)		(4,946	)
Pension adjustments, net		-			-			-			-			(1,275	)		(1,275	)		-			(1,275	)
Contributions		-			-			-			-			-			-			1,176			1,176
Distributions		-			-			-			-			-			-			(17,771	)		(17,771	)
Issuance of equity securities, net of retirement		16			-			(472	)		(293	)		-			(749	)		-			(749	)
Repurchases of common stock		(323	)		-			(24,677	)		-			-			(25,000	)		-			(25,000	)
Stock based compensation		-			-			9,800			-			-			9,800			-			9,800
Balance at September 30, 2025	$	146,369		$	(815,282	)	$	2,645,230		$	605,795		$	(24,282	)	$	2,557,830		$	106,810		$	2,664,640


Balance at June 30, 2024	$	146,697		$	(827,311	)	$	2,615,623		$	302,640		$	(19,139	)	$	2,218,510		$	101,134		$	2,319,644
Net income		-			-			-			71,951			-			71,951			13,638			85,589
Foreign currency translation gain, net		-			-			-			-			2,974			2,974			3			2,977
Pension adjustments, net		-			-			-			-			23			23			-			23
Contributions		-			-			-			-			-			-			961			961
Distributions		-			-			-			-			-			-			(13,757	)		(13,757	)
Issuance of equity securities, net of retirements		6			-			(145	)		(152	)		-			(291	)					(291	)
Stock based compensation		-			-			19,285			-			-			19,285			-			19,285
Balance at September 30, 2024	$	146,703		$	(827,311	)	$	2,634,763		$	374,439		$	(16,142	)	$	2,312,452		$	101,979		$	2,414,431

The accompanying notes are an integral part of these consolidated financial statements.

PARSONS CORPORATION AND SUBSIDIARIES

Consolidated Statements of Shareholders’ Equity

For the Nine Months Ended September 30, 2025 and September 30, 2024

(In thousands)

(Unaudited)


	Common Stock			Treasury Stock			Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Total Parsons Equity			Noncontrolling Interests			Total
Balance at December 31, 2024	$	146,655		$	(815,282	)	$	2,684,829		$	426,781		$	(26,594	)	$	2,416,389		$	118,100		$	2,534,489
Net income		-			-			-			185,556			-			185,556			48,514			234,070
Foreign currency translation gain, net		-			-			-			-			3,518			3,518			4			3,522
Pension adjustments, net		-			-			-			-			(1,206	)		(1,206	)		-			(1,206	)
Contributions		-			-			-			-			-			-			3,017			3,017
Distributions		-			-			-			-			-			-			(62,825	)		(62,825	)
Issuance of equity securities, net of retirement		680			-			(8,297	)		(6,542	)		-			(14,159	)		-			(14,159	)
Repurchases of common stock		(966	)		-			(64,028	)		-			-			(64,994	)		-			(64,994	)
Stock based compensation		-			-			32,726			-			-			32,726			-			32,726
Balance at September 30, 2025	$	146,369		$	(815,282	)	$	2,645,230		$	605,795		$	(24,282	)	$	2,557,830		$	106,810		$	2,664,640


Balance at December 31, 2023	$	146,341		$	(827,311	)	$	2,779,365		$	203,724		$	(14,908	)	$	2,287,211		$	89,504		$	2,376,715
Net income		-			-			-			180,873			-			180,873			40,428			221,301
Foreign currency translation loss, net		-			-			-			-			(1,210	)		(1,210	)		15			(1,195	)
Pension adjustments, net		-			-			-			-			(24	)		(24	)		-			(24	)
Contributions		-			-			-			-			-			-			1,038			1,038
Distributions		-			-			-			-			-			-			(29,006	)		(29,006	)
Capped call transactions		-			-			(66,121	)		-			-			(66,121	)		-			(66,121	)
Repurchase of warrants		-			-			(104,952	)		-			-			(104,952	)		-			(104,952	)
Bond hedge termination		-			-			149,308			-			-			149,308			-			149,308
Convertible debt inducement		-			-			(147,105	)		-			-			(147,105	)		-			(147,105	)
Issuance of equity securities, net of retirement		493			-			(5,823	)		(10,158	)		-			(15,488	)		-			(15,488	)
Repurchases of common stock		(131	)		-			(9,869	)		-			-			(10,000	)		-			(10,000	)
Stock based compensation		-			-			39,960			-			-			39,960			-			39,960
Balance at September 30, 2024	$	146,703		$	(827,311	)	$	2,634,763		$	374,439		$	(16,142	)	$	2,312,452		$	101,979		$	2,414,431

The accompanying notes are an integral part of these consolidated financial statements.

Parsons Corporation and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

Description of Operations

Organization

Parsons Corporation, a Delaware corporation, and its subsidiaries (collectively, the “Company”) provide sophisticated design, engineering and technical services, and smart and agile software to the United States federal government and Critical Infrastructure customers worldwide. The Company performs work in various foreign countries through local subsidiaries, joint ventures and foreign offices maintained to carry out specific projects.

Basis of Presentation and Principles of Consolidation

The accompanying unaudited consolidated financial statements and related notes of the Company have been prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP") and pursuant to the interim period reporting requirements of Form 10-Q. They do not include all of the information and footnotes required by GAAP for complete financial statements and, therefore, should be read in conjunction with our consolidated financial statements and the notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

In the opinion of management, the consolidated financial statements reflect all normal recurring adjustments necessary for a fair statement of the financial position, results of operations and cash flows for the interim periods presented. The results of operations and cash flows for any interim period are not necessarily indicative of results for the full year or for future years.

This Quarterly Report on Form 10-Q includes the accounts of Parsons Corporation and its subsidiaries and affiliates which it controls. Interests in joint ventures that are controlled by the Company, or for which the Company is otherwise deemed to be the primary beneficiary, are consolidated. For joint ventures in which the Company does not have a controlling interest, but exerts a significant influence, the Company applies the equity method of accounting (see “Note 14 – Investments in and Advances to Joint Ventures" for further discussion). Intercompany accounts and transactions are eliminated in consolidation. Certain amounts may not foot due to rounding.

Adoption of Accounting Standards Update 2024-04

As discussed in the Company's Form 10-K for the year ended December 31, 2024, in the fourth quarter of fiscal 2024, the Company adopted Accounting Standards Update (“ASU”) 2024-04, "Debt—Debt with Conversion and Other Options (Subtopic 470-20)" ("ASU 2024-04"). The Company elected to early adopt ASU 2024-04 as of January 1, 2024 on a prospective basis.

In the first quarter of 2024, the Company took an extinguishment charge related to the partial repurchase of Convertible Senior Notes due 2025. This repurchase was recorded in the Company's financial statements as a loss on debt extinguishment according to the applicable guidance prior to ASU 2024-04. With the early adoption of ASU 2024-04, the Company reassessed the accounting conclusion of the first quarter 2024 partial repurchase of Convertible Senior Notes due 2025 and concluded the partial repurchase is subject to inducement accounting under ASU 2024-04.

Under inducement accounting, the difference in the fair value of the securities issuable pursuant to conversion privileges compared to the fair value of the consideration paid on the date of the acceptance of the inducement offer is recorded to inducement expense. The difference in the consideration paid to note holders, less inducement expenses, less the fair value of the notes repurchased is charged to equity.

For the nine months ended September 30, 2024, the Company reversed the loss on extinguishment of debt for the partial repurchase of the Convertible Senior Notes due 2025 and recorded the repurchase transaction as an induced conversion. This change from extinguishment to inducement accounting resulted in the Company (i.) reversing the $211.0 million loss and the related $49.9 million tax benefit on extinguishment of debt, recorded in Q1 2024, (ii.) recording a $18.4 million convertible debt repurchase loss, (iii.) the difference between the extinguishment loss and inducement expense of $192.6 million recorded to equity, and (iv.) the related tax benefit of $45.6 million recorded to equity. See "Note 10— Debt and Credit Facilities" for a further discussion of the first quarter 2024 extinguishment accounting and

subsequent change to inducement accounting. Also see "Note 20—Quarterly Information" for the quarterly financial statement impacts related to this accounting change.

Use of Estimates

The preparation of the consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts could differ from those estimates. The Company’s most significant estimates and judgments involve revenue recognition with respect to the determination of the costs to complete contracts and transaction price; determination of self-insurance reserves; useful lives of property and equipment and intangible assets; valuation of deferred income tax assets and uncertain tax positions, among others. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Policies and Estimates” and “Note 2—Summary of Significant Accounting Policies” in the notes to our consolidated financial statements included in the Company’s Form 10-K for the year ended December 31, 2024, for a discussion of the significant estimates and assumptions affecting our consolidated financial statements. Estimates of costs to complete contracts are continually evaluated as work progresses and are revised when necessary. When a change in estimate is determined to have an impact on contract profit, the Company records a positive or negative adjustment to the consolidated statement of income.

New Accounting Pronouncements

In the fourth quarter of 2024, the Financial Accounting Standards Board ("FASB") Issued Accounting Standards Update (“ASU”) 2024-04, "Debt—Debt with Conversion and Other Options (Subtopic 470-20)" ("ASU 2024-04"). ASU 2024-04 improves the relevance and consistency in application of the induced conversion guidance in Subtopic 470-20, Debt–Debt with Conversion and Other Options. The amendments in ASU 2024-04 clarify the requirements for determining whether certain settlements of convertible debt instruments should be accounted for as an induced conversion. Under the amendments, to account for a settlement of a convertible debt instrument as an induced conversion, an inducement offer is required to provide the debt holder with, at a minimum, the consideration (in form and amount) issuable under the conversion privileges provided in the terms of the instrument. The amendments in this Update are effective for all entities for annual reporting periods beginning after December 15, 2025, and interim reporting periods within those annual reporting periods. Early adoption is permitted for all entities that have adopted the amendments in ASU 2020-06. The Company adopted ASU 2020-06 in the first quarter of 2021. The Company early adopted ASU 2024-04 as of January 1, 2024 on a prospective basis. The adoption of this ASU had a material impact on the Company's consolidated financial statements. See the Company's Form 10-K for the year ended December 31, 2024 for further details regarding the adoption of ASU 2024-04.

In the fourth quarter of 2024, the FASB Issued ASU 2024-03 "Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)" (ASU 2024-03"). ASU 2024-03 requires disclosure, in the notes to financial statements, of specified information about certain costs and expenses. ASU 2024-03 is effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The adoption of this ASU will not have a material impact on the Company's consolidated financial statements.

In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures (“ASU 2023-09”), to improve the transparency of income tax disclosures. ASU 2023-09 requires a public business entity (“PBE”) to disclose, on an annual basis, specific categories in its income tax rate reconciliation and provide additional information for reconciling items that meet a quantitative threshold. ASU 2023-09 also requires all entities to disclose its income taxes paid, net of refunds received, disaggregated by federal, state and foreign taxes, with further disaggregation required for significant individual jurisdictions. For public business entities, the new standard is effective for annual periods beginning after December 15, 2024. The Company plans to adopt ASU 2023-09 using the prospective approach in its fourth quarter of 2025 for the period ending December 31, 2025, and the adoption will impact only our disclosures with no material impact on the Company’s consolidated financial statements.

Acquisitions

Chesapeake Technology International, Corp

On June 30, 2025, the Company acquired a 100% ownership interest in Chesapeake Technology International, Corp ("CTI"), a privately owned company, for $91.5 million from cash on hand. CTI brings extensive capabilities as an all-domain technology solutions provider, powered by cutting-edge products that enhance the warfighters’ ability to sense, evaluate and deliver effects within the invisible battlespaces. CTI enhances our mission-ready solutions for the Department of Defense. In connection with this acquisition, the Company recognized $2.2 million of acquisition-related expenses in “Selling, general and administrative expense” in the consolidated statements of income for the nine months ended September 30, 2025, including legal fees, consulting fees, and other miscellaneous direct expenses associated with the acquisition.

The following table summarizes the acquisition date fair value of the purchase consideration transferred (in thousands):


	Amount
Cash and cash equivalents	$	4,769
Accounts receivable		28,145
Contract assets		4,256
Inventory		169
Right of use assets, operating leases		2,310
Prepaid expenses and other current assets		762
Property and Equipment		1,029
Goodwill		57,998
Intangible assets		34,820
Other noncurrent assets		3,173
Accounts payable		(17,818	)
Short-term lease liabilities, operating leases		(143	)
Accrued expenses and other current liabilities		(7,265	)
Contract liabilities		(8,079	)
Deferred income taxes		(6,300	)
Long-term lease liabilities, operating leases		(2,167	)
Other long-term liabilities		(4,125	)
Net assets acquired	$	91,534

Of the total purchase price, the following values were preliminarily assigned to intangible assets (in thousands, except for years):


	Gross Carrying Amount		Amortization Period
			(in years)
Customer relationships	$	20,690	15
Backlog		8,010	5
Developed technologies		3,000	3
Non-compete agreements		2,460	3
Trade name	$	660	1

Amortization expense of $1.4 million related to these intangible assets was recorded for the three and nine months ended September 30, 2025. The entire value of goodwill was assigned to the Federal Solutions reporting unit and represents synergies expected to be realized from this business combination. $8.5 million of goodwill is deductible for tax purposes.

The amount of revenue generated by CTI and included within consolidated revenue is $19.2 million for the three and nine months ended September 30, 2025. The Company has determined that the presentation of net income from the date of acquisition is impracticable due to the integration of general corporate functions upon acquisition.

The Company is still in the process of finalizing its valuation of the assets and liabilities acquired.

Supplemental Pro Forma Information (Unaudited)

Supplemental information of unaudited pro forma operating results assuming the CTI acquisition had been consummated as of the beginning of fiscal year 2024 (in thousands) is as follows:


	Three Months Ended				Nine Months Ended
	September 30, 2025		September 30, 2024		September 30, 2025		September 30, 2024
Pro forma Revenue	$	1,621,748	$	1,828,838	$	4,815,991	$	5,065,144
Pro forma Net Income including noncontrolling interests		82,693		83,368		236,520		211,653

The unaudited pro forma supplemental information is based on estimates and assumptions which the Company believes are reasonable and reflects the pro forma impact of additional amortization related to the fair value of acquired intangible assets, and the pro forma impact of reflecting acquisition costs, which consisted of legal, advisory and due diligence fees and expenses which are reflected in the earliest period presented. This supplemental pro forma information has been prepared for comparative purposes and does not purport to be indicative of what would have occurred had the acquisition been consummated during the periods for which pro forma information is presented.

TRS Group, Inc.

On January 31, 2025, the Company acquired a 100% ownership interest in TRS Group, Inc. ("TRS") a privately owned company, for $36.6 million from cash on hand (of which $3.8 million will be paid in July 2026). TRS is an environmental solutions firm that specializes in remediation technology. In connection with this acquisition, the Company recognized $0.5 million of acquisition-related expenses in “Selling, general and administrative expense” in the consolidated statements of income for nine months ended September 30, 2025, including legal fees, consulting fees, and other miscellaneous direct expenses associated with the acquisition.

The following table summarizes the acquisition date fair value of the purchase consideration transferred (in thousands):


	Amount
Cash and cash equivalents	$	2,054
Accounts receivable		3,390
Contract assets		2,277
Income taxes receivable		354
Prepaid expenses and other current assets		2,414
Property and Equipment		5,832
Goodwill		22,972
Intangible assets		6,100
Accounts payable		(1,095	)
Accrued expenses and other current liabilities		(3,270	)
Contract liabilities		(4,222	)
Short-term lease liabilities, operating leases		(116	)
Long-term lease liabilities, operating leases		(124	)
Net assets acquired	$	36,566

Of the total purchase price, the following values were preliminarily assigned to intangible assets (in thousands, except for years):

Amortization expense of $0.4 million and $1.1 million related to these intangible assets was recorded for the three and nine months ended September 30, 2025, respectively. The entire value of goodwill was assigned to the Critical Infrastructure reporting unit and represents synergies expected to be realized from this business combination. The entire value of goodwill is deductible for tax purposes.

The amount of revenue generated by TRS and included within consolidated revenue is $7.6 million and $19.0 million for the three and nine months ended September 30, 2025, respectively. The Company has determined that the presentation of net income from the date of acquisition is impracticable due to the integration of general corporate functions upon acquisition.

The Company is still in the process of finalizing its valuation of the assets and liabilities acquired.

Supplemental Pro Forma Information (Unaudited)

Supplemental information of unaudited pro forma operating results assuming the TRS acquisition had been consummated as of the beginning of fiscal year 2024 (in thousands) is as follows:


	Three Months Ended				Nine Months Ended
	September 30, 2025		September 30, 2024		September 30, 2025		September 30, 2024
Pro forma Revenue	$	1,621,748	$	1,817,499	$	4,762,454	$	5,037,031
Pro forma Net Income including noncontrolling interests		82,057		85,410		234,856		220,098

BCC Engineering, LLC

On November 1, 2024, the Company acquired a 100% ownership interest in BCC Engineering, LLC ("BCC") a privately owned company, for $233.5 million from cash on hand. BCC is a full-service engineering firm that provides planning, design, and management services for transportation, civil and structural engineering projects in Florida, Georgia, Texas, South Carolina, and Puerto Rico. This acquisition strengthens Parsons’ position as an infrastructure leader while expanding the company’s reach in the southeastern United States. In connection with this acquisition, the Company recognized $4.2 million of acquisition-related expenses in “Selling, general and administrative expense” in the

consolidated statements of income for the year ended December 31, 2024, including legal fees, consulting fees, and other miscellaneous direct expenses associated with the acquisition.

The following table summarizes the acquisition date fair value of the purchase consideration transferred (in thousands):


	Amount
Cash and cash equivalents	$	2,839
Accounts receivable		24,142
Contract assets		16,649
Prepaid expenses and other current assets		2,483
Right of use assets, operating leases		9,438
Property and Equipment		1,586

Gross
Carrying
Amount

Amortization
Period

(in years)

Developed technologies

Trade name

PARSONS CORP 10-Q