Dycom’s CEO says FTTH is the dominant driver in its communications segment
Key Highlights
- Dycom is bullish on FTTH, citing industry consolidations and nearly 60 million fiber passings as key growth drivers.
- The company plans to play a significant role in installing customer drops, the final segment of fiber connections to homes and businesses.
- Dycom expects to benefit from federal BEAD funding, with revenues ramping up as programs move from planning to active construction in 2027.
- Record quarterly revenue of $1.46 billion and annual revenue over $5.5 billion highlight strong demand for fiber infrastructure services.
- Looking ahead, Dycom forecasts 2027 revenues between $6.85 billion and $7.15 billion, driven by increased FTTH deployments and data center projects.
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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 remains bullish on the fiber-to-the-home (FTTH) opportunity, one that has grown as Verizon and AT&T completed their respective acquisitions of Frontier and Lumen’s consumer fiber business lines.
Speaking to investors during its fourth-quarter 2026 earnings call, Daniel Peyovich, CEO of Dycom, said that FTTH is not only the most established but also the main growth driver in its communications segment as it moves into fiscal year 2027.
“This quarter, our customers, again, either affirmed or exceeded goals,” he said. “With recently completed customer consolidations, we are seeing the same commitment to fiber infrastructure investment, further reinforcing our strategy. Current industry commitments represent nearly 60 million additional fiber-to-the-home passings.”
While Dycom has the workforce to address the number of homes its key customers plan to pass, Peyovich added that it is looking to play a key role in installing customer drops, which are the lateral connections required as subscribers subscribe to an FTTH provider’s service.
FTTH drops are the final segment of fiber-optic cabling that connects the service provider's distribution network to a customer's home or business. These lightweight, durable cables—often featuring aerial, underground, or indoor variants—deliver high-speed internet by carrying light signals directly to a network terminal (ONT)
“Following the initial build, these connections typically take an average of four years to reach terminal penetration, the point at which most potential subscribers in an area have been connected,” Peyovich said. “This creates a powerful multiyear tail of quality work. Simply put, Dycom is well-positioned to lead the fiber to the home market for the next decade.”
Ready for BEAD
Dycom is also keen to capitalize on its status as the construction company of choice for subgrantees participating in the government’s BEAD program.
As the NTIA approved 29 BEAD final proposals, the network construction company expects revenues in the quarter of the next fiscal year.
Earlier, in its third quarter, Dycom noted it had secured over $500 million in verbal awards related to BEAD deployments.
“The NTIA has already cleared the majority of states, representing more than $30 billion in total spend, and has moved over $17 billion, or more than half of that amount, into the funding stage,” Peyovich said. “We believe that our strategy, deep customer relationships, and proven performance will enable Dycom to be a leader in the execution of the BEAD program as it enters the funding base.”
He added that Dycom “continues to expect the first revenue opportunities in Q2, and we anticipate revenue to ramp as programs move from the planning phase into active construction in the second half of this year.”
According to Connected Nation’s BEAD tracker, 56 states and U.S. territories are eligible for BEAD funding, and the expected 54 respondents have submitted their Final Proposals to the National Telecommunications and Information Administration (NTIA) — representing $20.02 billion in federal funds.
However, Dycom is realistic that, while nearly all states have been approved for BEAD funding by the NTIA, it will take time for subgrantees to begin building new network facilities.
“It’s great to see the progress,” Peyovich said. “Nearly all the states and territories are approved. We think that the addressable market is approaching $20 billion, but it's going to take some time for those to get off the ground.”
Also, each state will roll out BEAD dollars at a different pace. This means that while smaller providers might be ready earlier than those rolling out larger network builds.
“If you think about a local cooperative that owns its own poles, it's probably already done the engineering to date,” Peyovich said. “As soon as they get the funding pushed down, they can hit the go button. And that's why we talked about something, but the bigger programs, the longer duration build, those are probably going to come on much later in the year.”
AT&T, Lumen lead revenues
Driven by continued execution of fiber-to-the-home programs, wireless activity, hyperscaler fiber infrastructure programs, and maintenance and operations services, Dycom’s Communications revenue was $1.4 billion.
AT&T and Lumen each exceeded 10% of total revenue for the quarter, contributing $351 million and $148 million, respectively.
Verizon, which completed its acquisition of Frontier earlier this year, was also a factor, with combined revenue of $205.6 million that exceeded 10% of total revenue.
Dycom also saw Brightspeed, Charter, Comcast, and Unity exceeding 5% of total consolidated revenue for the quarter.
For the quarter, Dycom delivered $1.46 billion in revenue, an increase of 34.4% compared to fourth quarter fiscal year 2025. The company noted this was a fourth-quarter record both in total and on an organic basis. Organic revenue increased 16.6% for the quarter, a testament to the strength of our backlog and the momentum going into the next year.
For the fourth quarter, Dycom’s consolidated total contract revenues were $1.46 billion, up 34.4% from the fourth quarter of 2025. Likewise, for the year, Dycom delivered record revenue of over $5.5 billion, exceeding the high end of our expectations and increasing 17.9% compared to the prior year.
Dycom noted that organic revenue growth for the year was driven by continued strong demand from fiber-to-the-home programs, long-haul and middle-mile fiber infrastructure deployments, growing inside-the-fence opportunities, and maintenance and operations services.
“Of note, this was a Q4 record both in total and on an organic basis,” Peyovich said. “Organic revenue increased 16.6% for the quarter, a testament to the strength of our backlog and the momentum going into the next year.”
Looking ahead to fiscal 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 demand 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 our 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.
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Sean Buckley
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