GEO Group Revenue Rises 12% To $761.1 Million — And It Raises Its Earnings Outlook
Adjusted profit grew 48%, while asset-sale gains in the year-earlier quarter made reported earnings a tougher comparison.
GEO Group, which manages detention facilities and immigration-processing centers for government agencies, increased third-quarter revenue 12% to $761.1 million and raised its full-year adjusted-profit outlook Thursday. Chairman and CEO George C. Zoley credited new and expanded contracts signed in 2025 for the revenue growth.
Higher Earnings After Adjustments
GEO's adjusted profit rose 48% to $51.8 million, or $0.39 per diluted share, against $35.0 million, or $0.25, a year earlier. Revenue in the year-earlier quarter was $682.3 million.
Reported profit attributable to GEO operations moved the other way: $49.2 million, or $0.37 per diluted share, compared with $173.9 million, or $1.24. Asset-sale gains and unusual items had lifted the year-earlier result; the latest quarter included $3.5 million in pre-tax adjustments covering litigation-related costs, start-up spending, transaction fees, restructuring and close-out expenses.
Adjusted earnings before interest, taxes, depreciation and amortization rose 21% to $145.3 million from $120.1 million. Zoley described quarterly revenue and that adjusted earnings measure as records for the company.
For the first nine months, revenue grew 14% to $2.2 billion from $1.9 billion, while adjusted profit increased 63% to $139.2 million from $85.3 million.
GEO's raised annual forecast calls for adjusted profit of $185 million–$190 million, or $1.40–$1.44 per diluted share, on revenue of $2.975 billion–$3.025 billion. Its increased fourth-quarter outlook puts adjusted profit at $46 million–$51 million, or $0.35–$0.39 per diluted share, on revenue of $777 million–$827 million.
Immigration Contracts Add Future Revenue
New and expanded contracts signed so far in 2026 represent approximately $500 million in additional annual revenue, Zoley said in the earnings release. GEO's business also includes reentry centers, electronic monitoring, supervision and secure transportation, with federal, state and local agencies as customers.
The Big Spring complex in Texas is expected to produce approximately $200 million in revenue during its first full operating year. The city's 10-year agreement with U.S. Immigration and Customs Enforcement took effect Sunday; GEO will provide support services at the 2,329-bed complex, comprising Flightline and Cedar Hill.
Two five-year ICE contracts cover the 1,188-bed Big Horn facility in Hudson, Colorado, and the GEO-owned, 1,320-bed Rivers facility in Winton, North Carolina. Their expected first-full-year annual revenue is approximately $85 million and $80 million, respectively. ICE will reimburse reactivation capital spending and fund start-up expenses at those facilities and Big Spring.
A new 10-year contract at the GEO-owned, 1,635-bed Northwest ICE Processing Center in Tacoma, Washington, took effect October 28. GEO expects approximately $140 million in annual revenue from that agreement.
Adelanto Cash Pays Down Debt
GEO completed the $950 million sale of its Adelanto complex in California on October 2, retaining approximately $705 million after taxes and transaction expenses. The company expects to keep providing support services under its existing ICE contract, whose full term runs through December 19, 2034.
Sale proceeds funded the October 15 redemption of $650 million in secured notes. Outstanding corporate debt now totals $625 million, and available liquidity—including cash and unused revolving credit—is approximately $600 million. GEO is also pursuing potential sales of other facilities to ICE while seeking to retain long-term management contracts.
By Thursday, GEO had spent approximately $177 million buying back approximately 10.1 million shares, leaving approximately 132 million shares outstanding and approximately $1.07 billion available under its authorization. Zoley called repurchases “a paramount capital allocation priority for our Company.”
GEO shares rose about 2% to $25.60 in Friday trading.
GEO expects Big Horn and Rivers activation to finish by year-end, with normal operations and earnings contributions in early 2027. Big Spring activation is expected to finish in the first quarter of 2027, with normal operations and earnings contributions in the second quarter.
Sources
- 8-K Filing — GEO GROUP INC (GEO) — SEC EDGAR
- Exhibit d311130dex991.htm — GEO GROUP INC 8-K exhibit — SEC EDGAR
- Geo Group: Q3 Earnings Snapshot | wusa9.com — Associated Press
- The GEO Group Reports Third Quarter 2026 Results and Updates Full Year 2026 Guidance — businesswire.com
