Dycom’s CEO says AT&T, Meta and Verizon hyperscale plans confirm its data center network build thesis
Key Highlights
- Dycom is actively participating in hyperscaler-focused network builds, supported by recent industry announcements from AT&T, Verizon, and Meta.
- The company is well-positioned for long-term growth through large fiber projects, long-haul network expansion, and inside data center construction.
- Major hyperscalers are increasing their CapEx budgets, creating a $20 billion addressable market for fiber and infrastructure services.
- Dycom's acquisition of Power Solutions enhances its capabilities in data center construction and cross-selling opportunities with hyperscalers.
- The company expects fiscal 2027 revenues to reach up to $7.15 billion, driven by fiber deployments and data center infrastructure demand.
Keep up to date with Lightwave’s Q4 2025 earnings coverage.
You can check our publication’s key segments:
And
Here are other stories on Dycom:
- Dycom’s CEO says it has secured half a billion in verbal agreements for BEAD projects
- Dycom’s Power Solutions acquisition bolsters its data center reach
- Dycom forecasts that data center network infrastructure will be a $20 billion market.
- Dycom’s CEO says Charter/Cox and Verizon/Frontier deals are a positive sign
Dycom is hot on the trail of positioning itself to participate in a new wave of hyperscaler network builds.
AT&T, Meta and Verizon all recently announced new hyperscaler-focused network plans. Besides serving up its Express Waves offerings for AI data transport, AT&T is also working with Amazon Web Services to extend 5G and fiber connectivity from business customers and locations directly into AWS environments.
Likewise, Verizon struck an agreement with AWS to build new, long-haul, high-capacity fiber pathways to connect AWS data center locations. Meanwhile, Meta struck a large fiber deal with Corning.
Daniel Peyovich, CEO of Dycom, sees these carriers' moves as proof points that hyperscalers are building new networks to handle new demands that traditional networks were not equipped for.
“Hyperscaler announcements by Verizon, AT&T, Meta and Corning confirm our thesis,” he said during Dycom’s fourth quarter 2026 earnings call. “Existing networks lack the capacity and latency required to support growing data consumption and AI inference.”
All five of the largest hyperscalers – Amazon, Alphabet, Meta, Microsoft, and Oracle – increased their 2026 capex budgets.
In this quarter alone, these providers collectively raised their CapEx guidance to nearly $718 billion, representing a nearly 70% year-over-year increase.
“The $20 billion addressable market that we identified across long haul, middle aisle and inside the science fiber and infrastructure continues to grow as it progresses through the ecosystem,” Peyovich said. “We are seeing more activity today than ever before. giving further confidence in the revenue opportunities now and in the future.”
Long-term cycles
While Dycom remains bullish about the hyperscaler opportunity, the company is realistic about how fast these programs will come into fruition.
“These large programs have a longer planning phase than fiber-to-the-home or other programs, and we see their pace ramping considerably for build that would start in earnest in calendar 2026,” Peyovich said. “Dycom is uniquely positioned for the long haul, middle mile and inside defense opportunity set.”
Already, Dycom is gaining momentum with large fiber providers supporting hyperscalers like Lumen, where it is participating in its overpull program. Lumen completed 3,200 miles of new overpull fiber, 130% of its 2025 target, across 27 routes in 2025
The service provider is moving forward with a multi-billion-dollar build with plans to add 34 million new intercity fiber miles by the end of 2028, for a total of 47 million intercity fiber miles.
Lumen’s overpull program comes on the heels of winning another $2.5 billion in new Private Connectivity Fabric (PCF) agreements.
“We expect our revenue to continue to ramp this year as we look to deliver on Lumen's overpull program,” Peyovich said.
While the period between network planning and construction of long-haul routes to support hyperscalers is longer than fiber to the home, Peyovich noted: “These programs generate elongated build cycles that provide revenue visibility well into the next decade.”
But Dycom is not only pursuing long-haul network opportunities. The company sees potential to serve as a construction partner to build fiber density within data center campuses.
“We continue to secure new awards inside the fence, validating that hyperscalers require a strategic scale partner to sustain their build base,” Peyovich said.
Power Solutions' cross-sell opportunities
While building communications networks is Dycom’s heritage, the company’s acquisition of Power Solutions has positioned it to expand into the data center market.
Dycom’s integration of Power Solutions, now part of its Building Systems segment, is on schedule, and the business is performing in line with expectations. At the end of the fourth quarter, it had $1.21 billion in backlog for Building Systems.
“Power Solutions acquisition is going incredibly well,” Peyovich said. “The integration is going just as we expected it to be. This is an incredibly strong, very deep leadership team that's been in that market for a long time.”
With Power Solutions in hand, Dycom is finding new opportunities to cross-sell the new solutions with its communications platforms to hyperscalers.
“The cross-sell is taking place even earlier than we anticipated,” Peyovich said. “The reaction from the hyperscalers has been fantastic. Where we can bring our inside defense communications work and couple that with what Power Solutions is doing inside the four walls, that we think is a recipe that wins over time.”
Having built its communications business through acquisitions—one that has given it a presence in 50 states—the company will focus on growing that segment organically.
Stopping short of naming any specific acquisition targets, Dycom also sees opportunities to grow its Building Systems segment through targeted acquisitions.
“With Power Solutions, there are obviously opportunities for organic expansion, and we're going to look into them and continue to work on them over time,” Peyovich said. “And we're also looking at M&A opportunities.”
Hyperscalers, broadband lead revenues
For the quarter, Dycom recorded fourth quarter revenue of $1.46 billion, an increase of 34.4% compared to Q4 FY 2025. Of note, this was a fourth-quarter record on both a total and an organic basis. Organic revenue increased 16.6% for the quarter.
Looking ahead to fiscal year 2027, Dycom expects total contract revenues to range from $6.85 billion to $7.15 billion, with gains in the Building Systems and Communications segments.
The company expects strong growth driven by multiple drivers, led by significant increases in fiber-to-the-home deployments, increasing demand for Communications and Building Systems services to support data center and hyperscaler build plans, and modest growth in its service and maintenance business.
For the Building Systems segment, Dycom expects contract revenues of $1.15 billion to $1.25 billion, and for the communications segment, $5.7 billion to $5.9 billion.
“As we turn the calendar to the new fiscal year, Dycom is strategically positioned for strong growth across multiple demand drivers led by significant increases in fiber-to-the-home deployments as well as increasing demand for communications and building system services to support data center and hyperscaler build,” Peyovich said.
For related articles, visit the Business Topic Center.
For more information on high-speed transmission systems and suppliers, visit the Lightwave Buyer’s Guide.
To stay abreast of fiber network deployments, subscribe to Lightwave’s Service Providers and Datacom/Data Center newsletters.
About the Author
Sean Buckley
Sean is responsible for establishing and executing the editorial strategy of Lightwave across its website, email newsletters, events, and other information products.