GRANITE CONSTRUCTION INC 10-Q

Item 1. FINANCIAL STATEMENTS GRANITE CONSTRUCTION INCORPORATED CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited - in thousands, except share and per share data) June 30, 2026 December 31, 2025 ASSETS Current assets: Cash and cash equivalents ($ 154,537 and $ 145,584 related to consolidated construction joint ventures (“CCJVs”)) $ 877,121 $ 529,220 Short-term marketable securities 36,852 71,021 Receivables, net ($ 48,324 and $ 37,398 related to CCJVs) 886,793 630,392 Contract assets ($ 36,185 and $ 34,057 related to CCJVs) 283,191 236,879 Inventories 182,116 143,129 Equity in unconsolidated construction joint ventures 131,096 134,670 Other current assets ($ 3,267 and $ 3,255 related to CCJVs) 52,979 66,920 Total current assets 2,450,148 1,812,231 Property and equipment, net ($ 4,831 and $ 4,961 related to CCJVs) 1,304,105 1,260,823 Long-term marketable securities 17,550 49,534 Investments in affiliates 102,424 96,764 Goodwill 445,984 400,814 Intangible assets, net 211,812 179,548 Right of use assets 167,074 152,678 Other noncurrent assets 79,779 78,001 Total assets $ 4,778,876 $ 4,030,393 LIABILITIES AND EQUITY Current liabilities: Current maturities of long-term debt $ 381,008 $ 375,896 Accounts payable ($ 48,880 and $ 46,708 related to CCJVs) 607,814 430,298 Contract liabilities ($ 52,672 and $ 63,500 related to CCJVs) 440,364 327,372 Embedded conversion option derivative liability (see Note 9) 630,473 — Accrued expenses and other current liabilities ($ 3,277 and $ 2,922 related to CCJVs) 359,219 348,179 Total current liabilities 2,418,878 1,481,745 Long-term debt 1,177,644 963,233 Long-term lease liabilities 137,747 125,733 Deferred income taxes, net 143,955 141,489 Other long-term liabilities 95,316 96,660 Commitments and contingencies (see Note 18) Equity: Preferred stock, $ 0.01 par value, authorized 3,000,000 shares, none outstanding — — Common stock, $ 0.01 par value, authorized 150,000,000 shares; issued and outstanding: 43,764,125 shares as of June 30, 2026 and 43,496,781 shares as of December 31, 2025 438 435 Additional paid-in capital 304,470 402,391 Accumulated other comprehensive income 4,568 1,581 Retained earnings 443,272 774,641 Total Granite Construction Incorporated shareholders’ equity 752,748 1,179,048 Non-controlling interests 52,588 42,485 Total equity 805,336 1,221,533 Total liabilities and equity $ 4,778,876 $ 4,030,393 The accompanying notes are an integral part of these condensed consolidated financial statements. 3 Table of Contents GRANITE CONSTRUCTION INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited - in thousands, except per share data) Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Revenue $ 1,455,872 $ 1,125,964 $ 2,368,337 $ 1,825,511 Cost of revenue 1,217,101 926,865 2,019,661 1,542,563 Gross profit 238,771 199,099 348,676 282,948 Selling, general and administrative expenses 107,794 85,887 248,744 201,798 Other costs, net 5,406 13,253 8,443 22,679 Gain on sales of property and equipment, net ( 1,237 ) ( 3,606 ) ( 4,186 ) ( 5,343 ) Operating income 126,808 103,565 95,675 63,814 Other (income) expense: Loss on convertible debt transactions, net 359,719 — 369,423 — Interest income ( 5,147 ) ( 5,761 ) ( 10,996 ) ( 12,029 ) Interest expense 21,761 7,927 38,093 15,684 Equity in income of affiliates, net ( 5,697 ) ( 3,698 ) ( 9,170 ) ( 4,792 ) Other income, net ( 4,492 ) ( 2,462 ) ( 3,831 ) ( 2,525 ) Total other (income) expense, net 366,144 ( 3,994 ) 383,519 ( 3,662 ) Income (loss) before income taxes ( 239,336 ) 107,559 ( 287,844 ) 67,476 Provision for income taxes 32,248 27,214 20,129 15,458 Net income (loss) ( 271,584 ) 80,345 ( 307,973 ) 52,018 Amount attributable to non-controlling interests ( 6,578 ) ( 8,645 ) ( 11,888 ) ( 13,974 ) Net income (loss) attributable to Granite Construction Incorporated $ ( 278,162 ) $ 71,700 $ ( 319,861 ) $ 38,044 Net income (loss) per share attributable to common shareholders (see Note 16): Basic $ ( 6.36 ) $ 1.64 $ ( 7.33 ) $ 0.87 Diluted $ ( 6.36 ) $ 1.42 $ ( 7.33 ) $ 0.84 Weighted average shares outstanding: Basic 43,751 43,746 43,641 43,605 Diluted 43,751 52,755 43,641 52,616 The accompanying notes are an integral part of these condensed consolidated financial statements. 4 Table of Contents GRANITE CONSTRUCTION INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited - in thousands) Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Net income (loss) $ ( 271,584 ) $ 80,345 $ ( 307,973 ) $ 52,018 Other comprehensive income, net of tax Net unrealized gain on cash flow hedges, net of tax $ 2,320 $ — $ 4,335 $ — Less: reclassification for net gains (losses) included in interest expense, net of tax ( 281 ) — ( 478 ) 185 Net change $ 2,039 $ — $ 3,857 $ 185 Foreign currency translation adjustments, net ( 466 ) 932 ( 870 ) 1,394 Other comprehensive income, net of tax $ 1,573 $ 932 $ 2,987 $ 1,579 Comprehensive income (loss), net of tax $ ( 270,011 ) $ 81,277 $ ( 304,986 ) $ 53,597 Non-controlling interests in comprehensive income (loss), net of tax ( 6,578 ) ( 8,645 ) ( 11,888 ) ( 13,974 ) Comprehensive income (loss) attributable to Granite Construction Incorporated, net of tax $ ( 276,589 ) $ 72,632 $ ( 316,874 ) $ 39,623 The accompanying notes are an integral part of these condensed consolidated financial statements. 5 Table of Contents GRANITE CONSTRUCTION INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (Unaudited - in thousands, except share data) Outstanding Shares Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income Retained Earnings Total Granite Shareholders’ Equity Non-controlling Interests Total Equity Balances at March 31, 2026 43,746,424 $ 437 $ 301,499 $ 2,995 $ 727,190 $ 1,032,121 $ 48,919 $ 1,081,040 Net loss — — — — ( 278,162 ) ( 278,162 ) 6,578 ( 271,584 ) Other comprehensive income — — — 1,573 — 1,573 — 1,573 Repurchases of common stock (1) ( 3,034 ) 1 ( 229 ) — — ( 228 ) — ( 228 ) Restricted stock units (“RSUs”) vested 16,930 — — — — — — — Dividends on common stock ($ 0.13 per share) — — 67 — ( 5,756 ) ( 5,689 ) — ( 5,689 ) Transactions with non-controlling interests — — — — — — ( 2,909 ) ( 2,909 ) Stock-based compensation expense and other 3,805 — 3,133 — — 3,133 — 3,133 Balances at June 30, 2026 43,764,125 $ 438 $ 304,470 $ 4,568 $ 443,272 $ 752,748 $ 52,588 $ 805,336 Balances at March 31, 2025 43,737,491 $ 437 $ 427,804 $ 65 $ 565,223 $ 993,529 $ 44,763 $ 1,038,292 Net income — — — — 71,700 71,700 8,645 80,345 Other comprehensive income — — — 932 — 932 — 932 Repurchases of common stock (1) ( 2,518 ) — ( 109 ) — — ( 109 ) — ( 109 ) RSUs vested 38,748 1 ( 1 ) — — — — — Dividends on common stock ($ 0.13 per share) — — 74 — ( 5,765 ) ( 5,691 ) — ( 5,691 ) Transactions with non-controlling interests — — — — — — ( 1,801 ) ( 1,801 ) Stock-based compensation expense and other 5,063 — 2,387 — — 2,387 — 2,387 Balances at June 30, 2025 43,778,784 $ 438 $ 430,155 $ 997 $ 631,158 $ 1,062,748 $ 51,607 $ 1,114,355 (1) Represents shares withheld related to employee taxes for RSUs vested under our equity incentive plans in 2026 and 2025. The accompanying notes are an integral part of these condensed consolidated financial statements. 6 Table of Contents Outstanding Shares Common Stock Additional Paid-In Capital Accumulated Other Comprehensive Income (Loss) Retained Earnings Total Granite Shareholders’ Equity Non-controlling Interests Total Equity Balances at December 31, 2025 43,496,781 $ 435 $ 402,391 $ 1,581 $ 774,641 $ 1,179,048 $ 42,485 $ 1,221,533 Net loss — — — — ( 319,861 ) ( 319,861 ) 11,888 ( 307,973 ) Other comprehensive income — — — 2,987 — 2,987 — 2,987 Repurchases of common stock (1) ( 157,235 ) ( 1 ) ( 18,668 ) — — ( 18,669 ) — ( 18,669 ) RSUs vested 421,279 4 ( 4 ) — — — — — Repurchase of 3.75% Convertible Notes — ( 178,804 ) — — ( 178,804 ) — ( 178,804 ) Partial unwind of capped call — — 55,112 — — 55,112 — 55,112 Dividends on common stock ($ 0.13 per share per quarter) — — 132 — ( 11,508 ) ( 11,376 ) — ( 11,376 ) Transactions with non-controlling interests — — — — — — ( 1,785 ) ( 1,785 ) Stock-based compensation expense and other 3,300 — 44,311 — — 44,311 — 44,311 Balances at June 30, 2026 43,764,125 $ 438 $ 304,470 $ 4,568 $ 443,272 $ 752,748 $ 52,588 $ 805,336 Balances at December 31, 2024 43,424,646 $ 434 $ 410,739 $ ( 582 ) $ 604,635 $ 1,015,226 $ 64,137 $ 1,079,363 Net income — — — — 38,044 38,044 13,974 52,018 Other comprehensive income — — — 1,579 — 1,579 — 1,579 Repurchases of common stock (1) ( 200,738 ) ( 2 ) ( 15,315 ) — — ( 15,317 ) — ( 15,317 ) RSUs vested 550,360 6 ( 6 ) — — — — — Dividends on common stock ($ 0.13 per share per quarter) — — 144 — ( 11,521 ) ( 11,377 ) — ( 11,377 ) Transactions with non-controlling interests — — — — — — ( 26,504 ) ( 26,504 ) Stock-based compensation expense and other 4,516 — 34,593 — — 34,593 — 34,593 Balances at June 30, 2025 43,778,784 $ 438 $ 430,155 $ 997 $ 631,158 $ 1,062,748 $ 51,607 $ 1,114,355 (1) Represents shares withheld related to employee taxes for RSUs vested under our equity incentive plans in 2026 and 2025, as well as 200 shares repurchased under our share repurchase program in 2025. The accompanying notes are an integral part of these condensed consolidated financial statements. 7 Table of Contents GRANITE CONSTRUCTION INCORPORATED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS ( Unaudited - in thousands ) Six Months Ended June 30, 2026 2025 Operating activities: Net income (loss) $ ( 307,973 ) $ 52,018 Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation, depletion and amortization 89,048 65,368 Amortization of debt issuance costs 3,344 2,163 Amortization of convertible debt discount 3,511 — Loss on derivative remeasurement related to convertible notes 363,530 — Convertible debt inducement expense 2,900 — Gain on sales of property and equipment, net ( 4,186 ) ( 5,343 ) Stock-based compensation 43,860 34,632 Equity in net income from unconsolidated construction joint ventures ( 13,096 ) ( 3,814 ) Net income from affiliates ( 9,170 ) ( 4,792 ) Other non-cash adjustments 2,782 ( 207 ) Changes in assets and liabilities: Receivables ( 268,405 ) ( 192,494 ) Contract assets, net 62,262 40,197 Inventories ( 36,634 ) ( 18,319 ) Contributions to unconsolidated construction joint ventures — ( 9,163 ) Distributions from unconsolidated construction joint ventures and affiliates 14,562 5,550 Other assets, net 18,000 7,221 Accounts payable 169,933 35,920 Accrued expenses and other liabilities, net 7,276 ( 3,499 ) Net cash provided by operating activities $ 141,544 $ 5,438 Investing activities: Purchases of marketable securities — ( 172,578 ) Maturities of marketable securities 66,500 17,600 Purchases of property and equipment ( 55,868 ) ( 61,022 ) Proceeds from sales of property and equipment 11,041 8,346 Acquisition of business, net of cash acquired (See Note 3) ( 162,098 ) — Collection of note receivable 24,960 — Other investing activities 1,037 399 Net cash used in investing activities $ ( 114,428 ) $ ( 207,255 ) Financing activities: Proceeds from long-term debt 770,000 — Debt repayments ( 465,293 ) ( 552 ) Proceeds from partial unwind of capped call 56,675 — Debt issuance costs ( 9,220 ) — Cash dividends paid ( 11,342 ) ( 11,338 ) Repurchases of common stock ( 18,669 ) ( 15,317 ) Contributions from non-controlling partners 2,400 — Distributions to non-controlling partners ( 4,185 ) ( 27,250 ) Other financing activities, net 419 ( 39 ) Net cash provided by (used in) financing activities $ 320,785 $ ( 54,496 ) Net increase (decrease) in cash and cash equivalents 347,901 ( 256,313 ) Cash and cash equivalents at beginning of period 529,220 578,330 Cash and cash equivalents at end of period $ 877,121 $ 322,017 8 Table of Contents Supplementary Information: Right of use assets obtained in exchange for lease obligations $ 26,280 $ 22,942 Cash paid during the period for: Operating lease liabilities $ 23,392 $ 13,591 Interest $ 35,065 $ 13,229 Income tax paid, net of refunds received (1) $ 6,687 $ 7,809 Other non-cash operating activities: Performance guarantees $ ( 4,335 ) $ — Non-cash investing and financing activities: RSUs issued, net of forfeitures $ 49,233 $ 38,452 Dividends declared but not paid $ 5,689 $ 5,691 (1) Income tax paid, net of refunds received, for the six months ended June 30, 2025, has been revised to reflect the retrospective adoption of ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The accompanying notes are an integral part of these condensed consolidated financial statements. 9 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) 1. General Basis of Presentation: The condensed consolidated financial statements included herein have been prepared by Granite Construction Incorporated (“we,” “us,” “our,” the “Company” or “Granite”) pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”), are unaudited and should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2025 (“Annual Report”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted. Further, the condensed consolidated financial statements reflect, in the opinion of management, all normal recurring adjustments necessary to state fairly our financial position at June 30, 2026 and the results of our operations and cash flows for the periods presented. The December 31, 2025 condensed consolidated balance sheet data included herein was derived from audited consolidated financial statements but does not include all disclosures required by U.S. GAAP. Seasonality: Our operations are typically affected more by weather conditions during the first and fourth quarters of our fiscal year which may alter our construction schedules and can create variability in our revenues and profitability. Therefore, the results of operations for the three and six months ended June 30, 2026 are not necessarily indicative of the results to be expected for the full year. 2. Recently Issued and Adopted Accounting Pronouncements We closely monitor all Accounting Standards Updates (“ASU”) issued by the Financial Accounting Standards Board (“FASB”) and other authoritative guidance. Recently Issued Accounting Pronouncements: In May 2026, the FASB issued ASU 2026-02, Environmental Credits and Environmental Credit Obligations (Topic 818), which is intended to improve the financial accounting for and disclosure of activities related to environmental credits and environmental credit obligations by establishing guidance on the recognition, measurement, presentation, and disclosure requirements for all entities that generate, purchase, or receive environmental credits or have a regulatory compliance obligation that may be settled with environmental credits. The amendments are effective for fiscal years beginning after December 15, 2027, including interim periods within those fiscal years. We are currently evaluating the impact of this standard on our consolidated financial statements and related disclosures. Recently Adopted Accounting Pronouncements: In September 2025, the FASB issued ASU 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software , which aims to modernize the guidance to better align with current software development practices. We early adopted this ASU during the first quarter of 2026 and it did not have a material impact on our consolidated financial statements. In November 2024, the FASB issued ASU 2024-04 , Induced Conversions of Convertible Debt Instruments (“ASU 2024-04”). The new guidance clarifies the assessment of whether a transaction should be accounted for as an induced conversion or extinguishment of convertible debt when changes are made to conversion features as part of an offer to settle the instrument. The guidance is effective for fiscal years beginning after December 15, 2025, and interim periods within those annual reporting periods. We adopted this ASU during the first quarter of 2026. See Note 14 for more information. No other new accounting pronouncements were recently issued or adopted that had or are expected to have a material impact on our financial statements. 3. Acquisitions We accounted for our recent acquisitions in accordance with Accounting Standards Codification (“ASC”) Topic 805, Business Combinations. The preliminary purchase prices were allocated to assets acquired and liabilities assumed based on their estimated fair values as of the respective acquisition dates. The purchase price allocations for KSC Utah Investments, Inc. (“Kenny Seng Construction”), Cinderlite Trucking Corporation (“Cinderlite”), Slats Lucas, LLC and Warren Paving, Inc. (collectively, “Warren Paving”), and Papich Construction Company, Inc. (“Papich Construction”) are preliminary and have not been finalized due to the recent timing of these acquisitions, as certain information is pending as of the date of this filing to finalize estimates of fair value of certain assets acquired and liabilities assumed. As we continue to integrate the acquired businesses, we may obtain additional information on the acquired tangible and identifiable intangible net assets which, if significant, may require revisions to preliminary valuation assumptions, estimates and the resulting fair values presented herein. We expect to finalize purchase price accounting in the 12 months following each acquisition. 10 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) K enny Seng Construction On April 23, 2026, we completed the acquisition of Kenny Seng Construction, for $ 164.1 million in cash, subject to customary closing adjustments. We purchased all of the issued and outstanding common stock of Kenny Seng Construction, which is a provider of construction services and materials in Utah. This acquisition aligns with our strategy of enhancing our vertical integration by strengthening an existing home market. Kenny Seng Construction's customers are in both the public and private sectors. Kenny Seng Construction's results have been included in the Construction and Materials segments since the acquisition date. Revenue attributable to Kenny Seng Construction for the three and six months ended June 30, 2026 was $ 29.8 million. Gross profit attributable to Kenny Seng Construction for the three and six months ended June 30, 2026 was $ 3.5 million. Preliminary Purchase Price Allocation For the purpose of this allocation, the contractual purchase price has been adjusted to include customary closing adjustments, resulting in a preliminary purchase price of $ 163.6 million. Based on our preliminary purchase price allocation, the net tangible and identifiable intangible assets acquired were $ 70.4 million and $ 45.3 million, respectively. We recorded goodwill of $ 47.9 million, all of which is expected to be tax deductible. The acquired goodwill is primarily attributable to the Construction segment, with an immaterial amount recorded in the Materials segment. The most significant assets acquired were property and equipment of $ 68.2 million and accounts receivable of $ 12.6 million. The identifiable intangible assets acquired consisted of backlog, trademarks/trade name, water rights, and customer relationships. Pro Forma Financial Information The pro forma financial information in the table below summarizes the combined results of operations of Granite and Kenny Seng Construction as though the companies had been combined as of January 1, 2025. The pro forma financial information is presented for informational purposes only and is not indicative of the results of operations that would have been achieved if the acquisition had taken place on January 1, 2025, nor does it intend to be a projection of future results. Three Months Ended June 30, Six Months Ended June 30, (unaudited, in thousands) 2026 2025 2026 2025 Revenue $ 1,471,714 $ 1,167,402 $ 2,410,248 $ 1,891,798 Net income attributable to Granite Construction Incorporated $ ( 289,847 ) $ 74,336 $ ( 328,023 ) $ 36,921 These amounts have been calculated after applying Granite’s accounting policies and adjusting the results of Kenny Seng Construction to reflect the additional depreciation and amortization that would have been recorded assuming the fair value adjustments to property and equipment and intangible assets had been applied starting on January 1, 2025. Acquisition-related expenses related to Kenny Seng Construction that were incurred during the three and six months ended June 30, 2026 are reflected in the six months ended June 30, 2025 due to the assumed timing of the transaction. The statutory tax rate of 26% was used for both 2026 and 2025 for the pro forma adjustments. During the three and six months ended June 30, 2026, we incurred $ 1.9 million and $ 3.8 million, respectively, of acquisition-related costs associated with the Kenny Seng Construction acquisition which were primarily related to professional services and are included in Other costs, net on the Condensed Consolidated Statement of Operations. Cinderlite Trucking Corporation On October 3, 2025, we completed the acquisition of Cinderlite and related assets, for $ 58.5 million in cash, subject to customary closing adjustments. We purchased all of the outstanding equity interest of Cinderlite, which is a construction materials, landscape supply, and transportation company in Carson City, Nevada. This acquisition aligns with our strategy of enhancing our vertical integration by strengthening an existing home market. Based on the preliminary purchase price allocation, the net tangible assets acquired were $ 58.3 million. The most significant asset was property and equipment of 11 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) $ 58.1 million. We recorded $ 0.1 million in goodwill that was allocated to our Materials segment and is deductible for income tax purposes. Cinderlite's customers are in both the public and private sectors. Cinderlite's results have been included in the Materials segment since the acquisition date. Revenue attributable to Cinderlite for the three and six months ended June 30, 2026 was $ 7.6 million and $ 11.0 million, respectively. Gross profit attributable to Cinderlite for the three and six months ended June 30, 2026 was immaterial. Warren Paving On August 5, 2025, we completed the acquisition of Warren Paving for $ 540.0 million in cash, subject to customary closing adjustments. We purchased all of the outstanding equity interests in Warren Paving, which is a vertically-integrated asphalt contractor and aggregate producer with operations along the Gulf Coast and Mississippi River. This acquisition aligns with our strategy to expand our presence into new geographies with future growth opportunities while supporting our existing operations, particularly the Materials segment. Warren Paving’s customers are in both the public and private sectors. Warren Paving's results have been included in the Construction and Materials segments since the acquisition date. Revenue attributable to Warren Paving for the three and six months ended June 30, 2026 was $ 72.5 million and $ 133.7 million, respectively. Gross profit attributable to Warren Paving for the three and six months ended June 30, 2026 was $ 7.1 million and $ 16.7 million, respectively. Preliminary Purchase Price Allocation The following table presents the preliminary purchase price allocation: (in thousands) Assets: Cash and cash equivalents $ 4,217 Receivables 38,564 Contract assets 609 Inventories 28,425 Other current assets 112 Property and equipment 419,737 Right of use assets 54,867 Other noncurrent assets 5,767 Total tangible assets 552,298 Identifiable intangible assets 46,800 Liabilities: Accounts payable 21,059 Contract liabilities 2,217 Accrued expenses and other current liabilities 13,360 Long-term lease liabilities 46,630 Deferred income taxes, net 103,017 Other long-term liabilities 7,000 Total liabilities assumed 193,283 Total tangible and identifiable net assets acquired 405,815 Goodwill 142,768 Preliminary purchase price (1) $ 548,583 (1) The preliminary purchase price includes customary closing adjustments. 12 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) Goodwill Goodwill represents the excess of the purchase price over the fair value of the underlying net tangible and intangible assets. The factors that contributed to the recognition of goodwill from this acquisition include strengthening and expanding our vertically-integrated Southeast home market and the assembled workforce. We recorded $ 142.8 million of goodwill, none of which is deductible for federal or state income tax purposes. Of the acquired goodwill, $ 29.2 million was allocated to the Construction segment and $ 113.6 million was allocated to the Materials segment. Papich Construction On August 5, 2025, we completed the acquisition of Papich Construction for $ 170.0 million in cash, subject to customary closing adjustments. We purchased all of the issued and outstanding common stock of Papich Construction, which is a provider of construction services and materials in California’s Central Coast and Central Valley regions. This acquisition aligns with our strategy of enhancing our vertical integration by strengthening our existing home markets. Papich Construction’s customers are in both the public and private sectors. Papich Construction's results have been included in the Construction and Materials segments since the acquisition date. Revenue attributable to Papich Construction for the three and six months ended June 30, 2026 was $ 48.5 million and $ 77.3 million, respectively. Gross loss attributable to Papich Construction for the three and six months ended June 30, 2026 was $ 1.5 million and $ 7.5 million, respectively. Preliminary Purchase Price Allocation For the purpose of this allocation, the contractual purchase price has been adjusted to include customary closing adjustments, resulting in a preliminary purchase price of $ 178.0 million. Based on our preliminary purchase price allocation, the net tangible and identifiable intangible assets acquired were $ 121.8 million and $ 16.1 million, respectively, resulting in acquired goodwill of $ 40.1 million, all of which is expected to be deductible for federal and state income tax purposes. The identifiable intangible assets acquired consisted of backlog, permits and customer relationships. Of the acquired goodwill, $ 5.0 million is in the Materials segment and $ 35.1 million is in the Construction segment. The most significant assets acquired were $ 88.2 million of property and equipment and $ 33.6 million of accounts receivable. The factors that contributed to the recognition of goodwill from this acquisition include the strengthening of our vertically-integrated California home market and the assembled workforce. 4. Revisions in Estimates Our profit recognition related to construction contracts is based on estimates of transaction price and costs to complete each project. These estimates can vary significantly in the normal course of business as projects progress, circumstances develop and evolve, and uncertainties are resolved. Changes in estimates of transaction price and costs to complete may result in the reversal of previously recognized revenue if the current estimate adversely differs from the previous estimate. In addition, the estimated or actual recovery related to estimated costs associated with unresolved affirmative claims and back charges may be recorded in future periods or may be at values below the associated cost, which can cause fluctuations in the gross profit impact from revisions in estimates. When we experience significant revisions in our estimates, we undergo a process that includes reviewing the nature of the changes to ensure that there are no material amounts that should have been recorded in a prior period rather than as revisions in estimates for the current period. For revisions in estimates, generally we use the cumulative catch-up method for changes to the transaction price that are part of a single performance obligation. Under this method, revisions in estimates are accounted for in their entirety in the period of change. There can be no assurance that we will not experience further changes in circumstances or otherwise be required to revise our estimates in the future. In our review of these changes for the three and six months ended June 30, 2026 and 2025, we did not identify any material amounts that should have been recorded in a prior period. The projects with increases from revisions in estimates, which individually had an impact of $ 5.0 million or more on gross profit, are summarized as follows (dollars in millions, except per share data): 13 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Number of projects with upward estimate changes 3 1 4 3 Range of increase in gross profit, net $ 5.6 - 11.4 $ 6.8 $ 5.6 - 11.4 $ 6.3 - 9.8 Increase to project profitability, net $ 24.7 $ 6.8 $ 30.9 $ 22.9 Increase to net income $ 18.3 $ 5.1 $ 22.9 $ 17.1 Amounts attributable to non-controlling interests $ — $ — $ 2.5 $ — Increase to net income attributable to Granite Construction Incorporated $ 18.3 $ 5.1 $ 20.3 $ 17.1 Increase to net income per diluted share attributable to common shareholders $ 0.42 $ 0.10 $ 0.47 $ 0.33 The increases during the three and six months ended June 30, 2026 were due to decreases in estimated costs from mitigated risks, changes in transaction price related to contract modifications resulting from revisions to project work plans and scheduling, and changes in the estimated amount of probable recovery on outstanding claims. Additionally, the six months ended June 30, 2026 increased due to acceleration of project schedule. The increases during the three and six months ended June 30, 2025 were due to settlement of outstanding claims and production at a higher rate than anticipated and acceleration of project schedule. The projects with decreases from revisions in estimates, which individually had an impact of $ 5.0 million or more on gross profit, are summarized as follows (dollars in millions, except per share data): Three Months Ended June 30, Six Months Ended June 30, 2026 2025 2026 2025 Number of projects with downward estimate changes 1 1 1 2 Range of reduction in gross profit, net $ 10.7 $ 5.4 $ 14.2 $ 6.8 - 14.3 Decrease to project profitability, net $ 10.7 $ 5.4 $ 14.2 $ 21.1 Decrease to net income attributable to Granite Construction Incorporated $ 8.0 $ 4.1 $ 10.5 $ 15.8 Decrease to net income per diluted share attributable to common shareholders $ 0.18 $ 0.08 $ 0.24 $ 0.30 The decreases during the three and six months ended June 30, 2026 and June 30, 2025 were due to additional costs related to changes in project duration, lower productivity than originally anticipated and increased labor and materials costs. 5. Disaggregation of Revenue In addition to disaggregating revenue by reportable segment (see Note 19), we further disaggregate Construction segment revenue by customer type and Materials segment revenue by product line. We believe this best depicts how the nature, amount, timing and uncertainty of our revenue and cash flows are affected by economic factors. Construction Segment Disaggregation by Customer Type Customers in our Construction segment are predominantly in the public sector which includes certain federal agencies, state departments of transportation, local transit authorities, county and city public works departments and school districts. Our private sector customers include, but are not limited to, developers, utilities and private owners of industrial, commercial and residential sites. Materials Segment Disaggregation by Product Line The Materials segment focuses primarily on production of aggregates, recycled materials, asphalt concrete and liquid asphalt. Our Aggregates product line includes aggregates, barge delivery and recycled materials. Our Asphalt product line includes asphalt concrete and liquid asphalt. Revenue from these product lines includes freight and delivery costs that we 14 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) pass along to our customers. Other includes immaterial amounts of revenue from products and services that are not considered to be core product lines. The following table presents our revenue disaggregated by reportable segment, by customer type for our Construction segment and product line for our Materials segment: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2026 2025 2026 2025 Construction segment revenue: Public $ 946,182 $ 651,923 $ 1,494,504 $ 1,047,808 Private 261,297 285,503 479,029 504,236 Total Construction segment revenue $ 1,207,479 $ 937,426 $ 1,973,533 $ 1,552,044 Materials segment revenue: Aggregates $ 115,763 $ 59,643 $ 206,736 $ 100,045 Asphalt 131,864 128,625 187,302 173,063 Other 766 270 766 359 Total Materials segment revenue $ 248,393 $ 188,538 $ 394,804 $ 273,467 Total revenue $ 1,455,872 $ 1,125,964 $ 2,368,337 $ 1,825,511 6. Unearned Revenue The following table presents our unearned revenue disaggregated by customer type as of the respective periods: (in thousands) June 30, 2026 December 31, 2025 Public $ 4,354,348 $ 3,628,561 Private 702,114 494,552 Total $ 5,056,462 $ 4,123,113 All unearned revenue is in the Construction segment. Approximately $ 4.0 billion of the June 30, 2026 unearned revenue is expected to be recognized within the next twelve months and the remaining amount will be recognized thereafter. 7. Contract Assets and Liabilities As a result of changes in contract transaction price related to performance obligations that were satisfied or partially satisfied prior to the end of the periods, we recognized revenue of $ 92.4 million and $ 68.8 million during the three months ended June 30, 2026 and 2025, respectively, and $ 148.5 million and $ 118.3 million during the six months ended June 30, 2026 and 2025, respectively. The changes in contract transaction price for the three and six months ended June 30, 2026 and 2025 were from items such as executed or estimated change orders, contract modifications and claims. As of June 30, 2026 and December 31, 2025, the aggregate claim recovery estimates included in contract asset and liability balances were $ 19.6 million and $ 19.4 million, respectively. The components of the contract asset balances as of the respective dates were as follows: (in thousands) June 30, 2026 December 31, 2025 Costs in excess of billings and estimated earnings $ 115,146 $ 73,079 Contract retention 168,045 163,800 Total contract assets $ 283,191 $ 236,879 As of June 30, 2026 and December 31, 2025, no contract retention receivables individually exceeded 10% of total contract assets. The majority of the contract retention balance is expected to be collected within one year. As work is performed, revenue is recognized and the corresponding contract liabilities are reduced. We recognized revenue of $ 105.9 million and $ 105.1 million during the three months ended June 30, 2026 and 2025, respectively, and $ 328.8 15 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) million and $ 312.9 million during the six months ended June 30, 2026 and 2025, respectively, that was included in the contract liability balances at December 31, 2025 and 2024, respectively. The components of the contract liability balances as of the respective dates were as follows: (in thousands) June 30, 2026 December 31, 2025 Billings in excess of costs and estimated earnings, net of retention $ 435,251 $ 320,593 Provisions for losses 5,113 6,779 Total contract liabilities $ 440,364 $ 327,372 The increase in contract liabilities is primarily due to increases in billings in excess of costs on new projects partially offset by reductions in provisions for losses as certain loss projects progress towards completion. 8. Receivables, net Receivables include billed and unbilled amounts for services provided to clients for which we have an unconditional right to payment as of the end of the applicable period and generally do not bear interest. The following table presents major categories of receivables: (in thousands) June 30, 2026 December 31, 2025 Contracts completed and in progress: Billed $ 470,862 $ 297,157 Unbilled 252,137 174,434 Total contracts completed and in progress 722,999 471,591 Materials sales 130,301 89,945 Other 35,281 70,484 Total gross receivables 888,581 632,020 Less: allowance for credit losses 1,788 1,628 Total net receivables $ 886,793 $ 630,392 Included in other receivables at June 30, 2026 and December 31, 2025 were items such as estimated recovery from back charge claims and income and other tax refunds receivable. Other receivables at December 31, 2025 also included $ 25.0 million of working capital contributions in the form of a loan to a partner in one of our unconsolidated construction joint ventures, plus accrued interest. This receivable was collected during the second quarter. None of our customers had a receivable balance in excess of 10 % of our total net receivables as of June 30, 2026 or December 31, 2025. 9. Fair Value Measurement The following tables summarize significant assets and liabilities measured at fair value on a recurring basis in the Condensed Consolidated Balance Sheets for each of the fair value measurement levels (in thousands): Fair Value Measurement at Reporting Date Using June 30, 2026 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 190,793 $ — $ — $ 190,793 Other current assets: Interest rate swaps $ — $ 6,025 $ — $ 6,025 Heating oil derivatives — 1,077 — 1,077 Total assets $ 190,793 $ 7,102 $ — $ 197,895 Current liabilities: Embedded conversion option derivative liability $ — $ — $ 630,473 $ 630,473 Total liabilities $ — $ — $ 630,473 $ 630,473 16 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) Fair Value Measurement at Reporting Date Using December 31, 2025 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 231,865 $ — $ — $ 231,865 Other current assets: Interest rate swaps $ — $ 830 $ — $ 830 Total assets $ 231,865 $ 830 $ — $ 232,695 Accrued and other current liabilities: Heating oil derivatives $ — $ 122 $ — $ 122 Total liabilities $ — $ 122 $ — $ 122 Interest Rate Swaps In September 2025, we entered into two interest rate swaps designated as cash flow hedges with an effective date of January 2026. The two cash flow hedges had a combined initial notional amount of $ 350 million and mature in January of 2029. The interest rate swaps are designed to convert the interest rate on our Term Loan (as defined below) under our Fifth Amended and Restated Credit Agreement (the “Credit Agreement”) (See Note 14) from a variable interest rate of Secured Overnight Financing Rate (“SOFR”) plus an applicable margin to a fixed rate of 3.218 % plus the same applicable margin. The interest rate swap is measured at fair value on the consolidated balance sheet using the income approach, which discounts the future net cash settlements expected under the derivative contracts to a present value. These valuations primarily utilize indirectly observable inputs, including contractual terms, interest rates, and yield curves observable at commonly quoted intervals. Commodity Derivatives We enter into derivative contracts to reduce our price exposure to commodity price fluctuations. Our outstanding heating oil derivative contracts have maturity dates through December 2027. These contracts were not designated as hedges and are treated as mark-to-market derivative instruments through their maturity dates with gains and losses recognized in the Condensed Consolidated Statements of Operations in cost of revenue. During the three and six months ended June 30, 2026 and 2025, we recognized immaterial amounts related to the commodity derivatives. Embedded Conversion Option Derivative Liability On May 19, 2026 (the “Call Notice Date”), we called the outstanding $ 273.7 million aggregate principal amount of the 3.75 % convertible senior notes due 2028 (“ 3.75 % Convertible Notes”) for redemption on August 10, 2026, and elected to settle conversions on or after the Call Notice Date and through the close of business on August 6, 2026 by paying cash up to $ 2,617.40 per $1,000 principal amount of the 3.75 % Convertible Notes to be converted and delivering shares of our common stock in respect of the remainder, if any, of the conversion obligation in excess thereof (the “Conversion Election”). The Conversion Election caused the embedded conversion option of the 3.75 % Convertible Notes to no longer qualify for the “own-equity” scope exception under ASC 815, Derivatives and Hedging (“ASC 815”). As a result, the embedded conversion option was required to be bifurcated from the 3.75 % Convertible Notes (see Note 14). The resulting derivative liability reflects the incremental value attributable to the holders' ability to convert the 3.75 % Convertible Notes under the terms of the Conversion Election. As our stock price increases or decreases, the economic benefit associated with the conversion option increases or decreases, resulting in a higher or lower derivative value. The derivative liability was measured at fair value upon bifurcation and as of June 30, 2026 with changes in fair value recognized in the Condensed Consolidated Statements of Operations in loss on convertible debt transactions, net. Rollforward of Level 3 Derivative Liability (in thousands): Fair value at May 19, 2026 $ 527,863 Loss on derivative remeasurement 102,610 Fair value as of June 30, 2026 $ 630,473 The embedded conversion option derivative liability is measured at fair value on the consolidated balance sheet using a with-and-without approach. Under this methodology, the fair value of the 3.75 % Convertible Notes including the conversion option was based on the observable market price of the 3.75 % Convertible Notes as of June 30, 2026. The fair value of the 3.75 % Convertible Notes excluding the conversion option was estimated using a discounted cash flow analysis 17 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) to determine the value of a comparable non-convertible debt instrument. Certain significant assumptions that are not directly observable in the market place were utilized, including the market yield that investors would require to hold a comparable Granite debt instrument and assumptions regarding the potential variability of such yields over time. Unobservable Inputs June 30, 2026 Market yield for comparable non-convertible debt instrument 4.18 % Variability in market yields for comparable debt instruments 26.0 % Other Assets and Liabilities The carrying values and estimated fair values of financial instruments that are not required to be recorded at fair value in the Condensed Consolidated Balance Sheets were as follows: June 30, 2026 December 31, 2025 (in thousands) Fair Value Hierarchy Carrying Value Fair Value Carrying Value Fair Value Assets: Held-to-maturity marketable securities (1) Corporate notes and bonds Level 1 $ 47,500 $ 47,522 $ 59,477 $ 59,757 U.S. Government and agency obligations Level 1 $ — $ — $ 10,001 $ 10,006 Commercial paper Level 1 $ 49,871 $ 49,863 $ 39,202 $ 39,198 Municipal notes and bonds Level 1 $ 6,901 $ 6,896 $ 11,875 $ 11,890 Liabilities (including current maturities): 6.375 % Senior Notes (2) Level 2 $ 600,000 $ 611,250 $ — $ — 3.75 % Convertible Notes (2) Level 2 $ 273,747 $ 904,705 $ 373,750 $ 950,013 3.25 % Convertible Notes (2) Level 2 $ 373,750 $ 788,979 $ 373,750 $ 597,206 Credit Agreement - Term Loan (2) Level 3 $ 600,000 $ 605,202 $ 600,000 $ 602,265 (1) All marketable securities were classified as held-to-maturity as of the periods presented. Of the above balances, $ 36.9 million and $ 71.0 million were short-term marketable securities on our Condensed Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025, respectively and $ 17.6 million were long-term marketable securities on our Condensed Consolidated Balance Sheets as of June 30, 2026. Our long-term marketable securities have varying maturities between one and three years . (2) The fair values of our 6.375 % senior unsecured notes due 2034 (the “ 6.375 % Senior Notes”), our 3.25 % convertible senior notes due 2030 (the “ 3.25 % Convertible Notes”) and our 3.75 % Convertible Notes are based on the median price of the notes in an active market. The fair value of the Credit Agreement is based on borrowing rates available to us for long-term loans with similar terms, average maturities and credit risk. See Note 14 for more information about our senior notes, convertible notes and the Credit Agreement. During the six months ended June 30, 2026 and 2025, we had no material nonfinancial asset and liability fair value adjustments. 10. Construction Joint Ventures We participate in various construction joint ventures. We have determined that certain of these joint ventures are consolidated because they are variable interest entities and we are the primary beneficiary. We continually evaluate whether there are changes in the status of the VIEs or changes to the primary beneficiary designation of the VIE. Based on our assessments during the three and six months ended June 30, 2026, we determined no change was required for existing joint ventures. Due to the joint and several nature of the performance obligations under the related owner contracts, if any of our partners fail to perform, we and the remaining partners, if any, would be responsible for performance of the outstanding work (i.e., we provide a performance guarantee). We are not able to estimate amounts that may be required beyond the current remaining forecasted cost of the work to be performed. These forecasted costs could be offset by billings to the customer or by proceeds from our partners’ corporate and/or other guarantees. See Note 13 for disclosure of the performance guarantee amounts recorded in the Condensed Consolidated Balance Sheets. 18 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) Consolidated Construction Joint Ventures (“CCJVs”) As of June 30, 2026, we were engaged in nine active CCJV projects. Our proportionate share of the equity in these joint ventures was between 50.0 % and 70.0 %. During the three months ended June 30, 2026 and 2025, total revenue from CCJV's was $ 86.8 million and $ 89.3 million, respectively. During the six months ended June 30, 2026 and 2025, total revenue from CCJV's was $ 160.9 million and $ 163.9 million, respectively. During the six months ended June 30, 2026 and 2025, CCJVs provided $ 14.6 million and $ 74.5 million of operating cash flows, respectively. As of June 30, 2026, our share of revenue remaining to be recognized on these CCJVs was $ 352.5 million and ranged from $ 0.3 million to $ 205.4 million by project. Unconsolidated Construction Joint Ventures As of June 30, 2026, we were engaged in two active unconsolidated construction joint venture projects. Our proportionate share of the equity in these unconsolidated construction joint ventures ranged from 30.0 % to 40.0 %. As of June 30, 2026, our share of the revenue remaining to be recognized on these unconsolidated construction joint ventures was immaterial. The following is summary financial information related to unconsolidated construction joint ventures: (in thousands) June 30, 2026 December 31, 2025 Assets Cash, cash equivalents and marketable securities $ 106,652 $ 118,207 Other current assets (1) 527,252 547,968 Noncurrent assets 13,631 17,823 Less: partners’ interest 464,478 485,296 Granite’s interest (1),(2) $ 183,057 $ 198,702 Liabilities Current liabilities $ 85,718 $ 110,513 Less: partners’ interest and adjustments (3) 31,612 43,396 Granite’s interest $ 54,106 $ 67,117 Equity in construction joint ventures (4) $ 128,951 $ 131,585 (1) Included in this balance and in accrued expenses and other current liabilities on the Condensed Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025 was $ 29.9 million and $ 34.3 million , respectively related to performance guarantees (see Note 13). (2) Included in this balance as of June 30, 2026 and December 31, 2025 was $ 78.6 million and $ 66.9 million, respectively, related to Granite’s share of estimated cost recovery of customer affirmative claims. (3) Partners’ interest and adjustments includes amounts to reconcile total net assets as reported by our partners to Granite’s interest adjusted to reflect our accounting policies and estimates primarily related to contract forecast differences. (4) Included in this balance and in accrued expenses and other current liabilities on our Condensed Consolidated Balance Sheets was $ 2.1 million and $ 3.1 million as of June 30, 2026 and December 31, 2025, respectively, related to deficits in unconsolidated construction joint ventures, which includes provisions for losses. 19 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2026 2025 2026 2025 Revenue Total $ 8,598 $ ( 411 ) $ 15,281 $ 3,661 Less: partners’ interest and adjustments (1) ( 7,849 ) ( 6,374 ) ( 2,649 ) ( 7,220 ) Granite’s interest $ 16,447 $ 5,963 $ 17,930 $ 10,881 Cost of revenue Total $ 7,252 $ 15,286 $ 10,541 $ 32,820 Less: partners’ interest and adjustments (1) 2,231 11,551 4,850 25,135 Granite’s interest $ 5,021 $ 3,735 $ 5,691 $ 7,685 Granite’s interest in gross profit $ 11,426 $ 2,228 $ 12,239 $ 3,196 Net Income (Loss) Total $ 2,338 $ ( 14,511 ) $ 6,762 $ ( 26,972 ) Less: partners’ interest and adjustments (1) ( 9,371 ) ( 17,108 ) ( 6,334 ) ( 30,786 ) Granite’s interest in net income (2) $ 11,709 $ 2,597 $ 13,096 $ 3,814 (1) Partners’ interest and adjustments includes amounts to reconcile total revenue and total cost of revenue as reported by our partners to Granite’s interest adjusted to reflect our accounting policies and estimates primarily related to contract forecast and/or actual differences. (2) These joint venture net income amounts exclude our corporate overhead required to manage the joint ventures and include taxes only to the extent the applicable states have joint venture level taxes. 11. Investments in Affiliates Our investments in affiliates balance consists of equity method investments in the following types of entities: (in thousands) June 30, 2026 December 31, 2025 Foreign $ 81,558 $ 75,838 Real estate 4,234 4,120 Asphalt terminal 16,632 16,806 Total investments in affiliates $ 102,424 $ 96,764 The following table provides summarized balance sheet information for our affiliates accounted for under the equity method on a combined basis: (in thousands) June 30, 2026 December 31, 2025 Current assets $ 224,244 $ 215,601 Noncurrent assets 117,697 122,280 Total assets $ 341,941 $ 337,881 Current liabilities 77,341 73,005 Long-term liabilities (1) 43,631 51,087 Total liabilities $ 120,972 $ 124,092 Net assets $ 220,969 $ 213,789 Granite’s share of net assets $ 102,424 $ 96,764 (1) This balance is primarily related to local bank debt for equipment purchases, working capital in our foreign affiliates and debt associated with our real estate ventures. 20 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) 12. Property and Equipment, net Balances of major classes of assets and total accumulated depreciation and depletion are included in property and equipment, net in the Condensed Consolidated Balance Sheets as follows: (in thousands) June 30, 2026 December 31, 2025 Equipment and vehicles $ 1,531,443 $ 1,466,624 Quarry property 594,702 588,571 Land and land improvements 188,475 174,659 Buildings and leasehold improvements 119,520 121,165 Office furniture and equipment 87,151 84,145 Property and equipment $ 2,521,291 $ 2,435,164 Less: accumulated depreciation and depletion 1,217,186 1,174,341 Property and equipment, net $ 1,304,105 $ 1,260,823 13. Accrued Expenses and Other Current Liabilities (in thousands) June 30, 2026 December 31, 2025 Payroll and related employee benefits 132,688 145,384 Accrued insurance 107,889 84,470 Performance guarantees 29,938 34,273 Short-term lease liabilities 36,036 32,726 Other $ 52,668 $ 51,326 Total $ 359,219 $ 348,179 Other includes deficits in unconsolidated construction joint ventures, dividends payable, taxes payable, interest payable, warranty reserves, asset retirement obligations, remediation reserves and other miscellaneous accruals, none of which were greater than 5% of total current liabilities at any of the presented dates. 14. Debt (in thousands) June 30, 2026 December 31, 2025 6.375 % Senior Notes due 2034 $ 600,000 $ — 3.25 % Convertible Notes due 2030 373,750 373,750 3.75 % Convertible Notes due 2028 273,747 373,750 Credit Agreement - Term Loan 600,000 600,000 Debt discount on 3.75 % Convertible Notes conversion ( 270,236 ) — Debt issuance costs and other ( 18,609 ) ( 8,371 ) Total debt $ 1,558,652 $ 1,339,129 Less: current maturities 381,008 375,896 Total long-term debt $ 1,177,644 $ 963,233 6.375 % Senior Notes On June 2, 2026, we issued $ 600.0 million aggregate principal amount of the 6.375 % Senior Notes. The 6.375 % Senior Notes mature on June 15, 2034 and bear interest at a rate of 6.375 % per year, payable semiannually in arrears on June 15 and December 15 of each year, beginning December 15, 2026. The 6.375 % Senior Notes are guaranteed on a senior unsecured basis by each of our existing and future domestic subsidiaries that is a borrower or guarantor under the Credit Agreement, subject to certain exceptions. We may redeem the 6.375 % Senior Notes, in whole or in part, at any time on or after June 15, 2029 at specified redemption prices plus accrued and unpaid interest. If redeemed on or after June 15, 2029, the redemption prices, as a percentage of the principal of the 6.375 % Senior Notes to be redeemed are as follows: (i) on or after June 15, 2029, 103.188 %; (ii) on or after 21 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) June 15, 2030, 101.594 %; and (iii) on or after June 15, 2031, 100.000 %. At any time prior to June 15, 2029, we may also redeem up to 40 % of the 6.375 % Senior Notes using the net proceeds of certain equity offerings, at a redemption price equal to 106.375 % of the principal amount of the 6.375 % Senior Notes to be redeemed, plus accrued and unpaid interest; provided, that at least 50 % of the original aggregate principal amount of the 6.375 % Senior Notes issued under the indenture governing the 6.375 % Senior Notes must remain outstanding after each such redemption. At any time prior to June 15, 2029, we may redeem some or all of the 6.375 % Senior Notes at a redemption price equal to 100 % of the principal amount thereof, plus accrued and unpaid interest, and a “make-whole” premium. Upon a change of control, we may be required to offer to purchase the 6.375 % Senior Notes at a price equal to 101 % of the principal amount thereof plus accrued and unpaid interest. Additionally, upon the sale of certain assets, we may be required to offer to purchase the 6.375 % Senior Notes at a price equal to 100 % of the principal amount thereof plus accrued and unpaid interest. The indenture governing the 6.375 % Senior Notes contains customary terms and covenants, including limitations on the incurrence of additional indebtedness, the making of restricted payments, the creation of liens, the transfer or sale of assets, the creation of restrictions on the payment of dividends to us by the guarantors, mergers or consolidations and affiliate transactions and provides that upon certain events of default occurring and continuing, either the trustee or the holders of at least 30 % in aggregate principal amount of the 6.375 % Senior Notes then outstanding may declare the entire principal amount of the 6.375 % Senior Notes, and the interest accrued on such 6.375 % Senior Notes, to be immediately due and payable. 3.25 % Convertible Notes On June 11, 2024, we issued $ 373.8 million aggregate principal amount of our 3.25 % Convertible Notes. The 3.25 % Convertible Notes bear interest at a rate of 3.25 % per annum, payable semi-annually in arrears on June 15 and December 15 of each year. The 3.25 % Convertible Notes mature on June 15, 2030, unless earlier converted, redeemed or repurchased. Prior to the close of business on the business day immediately preceding December 15, 2029, the 3.25 % Convertible Notes will be convertible at the option of the holders only upon the occurrence of certain events and during certain periods. Thereafter, the 3.25 % Convertible Notes will be convertible at the option of the holders at any time until the close of business on the second scheduled trading day immediately preceding their maturity date. The 3.25 % Convertible Notes have an initial conversion rate of 12.8398 shares of our common stock per $1,000 principal amount of the 3.25 % Convertible Notes, which is equivalent to an initial conversion price of approximately $ 77.88 per share of our common stock, subject to adjustment if certain events occur. Upon conversion, we will settle the principal amount of the 3.25 % Convertible Notes in cash, and any conversion premium in excess of the principal amount in cash, shares of our common stock, or a combination of cash and shares of common stock, at our election. As of June 30, 2026, one of the conditions permitting the holders of the 3.25 % Convertible Notes to convert continued to be met. Our common stock traded above 130 % of the $ 77.88 conversion price for at least 20 trading days during the period of 30 consecutive trading days ending on June 30, 2026 (the last trading day of the calendar quarter). The holders of the 3.25 % Convertible Notes have the right to convert through September 30, 2026, at which point we will re-evaluate whether the 3.25 % Convertible Notes will continue to be convertible in the subsequent calendar quarter. In the event the holders of the 3.25 % Convertible Notes elect to convert a portion or all of their 3.25 % Convertible Notes, the principal amount is required to be settled in cash. As a result, the $ 373.8 million principal amount remains classified as a current liability as of June 30, 2026 in our Condensed Consolidated Balance Sheets. Any conversion premium will be satisfied with cash, shares of our common stock or a combination of cash and shares of our common stock, at our election. Upon the occurrence of a “fundamental change” as defined in the indenture governing the 3.25 % Convertible Notes, holders may require us to repurchase for cash all or any portion of their 3.25 % Convertible Notes at a fundamental change repurchase price equal to 100 % of the principal amount of the 3.25 % Convertible Notes to be repurchased plus any accrued and unpaid interest to, but excluding, the fundamental change repurchase date. If certain corporate events that constitute a “make-whole fundamental change” as set forth in the indenture governing the 3.25 % Convertible Notes occur prior to the maturity date of the 3.25 % Convertible Notes or if we deliver a notice of redemption, we will, in certain circumstances, increase the conversion rate for a holder who elects to convert its 3.25 % Convertible Notes in connection with such event or notice of redemption. We will not be able to redeem the 3.25 % Convertible Notes prior to June 21, 2027. On or after June 21, 2027, we will be able to redeem for cash all or any portion of the 3.25 % Convertible Notes, at our option, if the last reported sale price of Granite’s common stock is equal to or greater than 130 % of the conversion price for a specified period of time at a redemption price equal to 100 % of the principal amount of the 3.25 % Convertible Notes to be redeemed, plus accrued but unpaid interest to, but excluding, the redemption date. The indenture governing the 3.25 % Convertible Notes contains 22 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) customary events of default. In the case of an event of default arising from certain events of bankruptcy, insolvency or reorganization, with respect to us or our significant subsidiaries, all outstanding 3.25 % Convertible Notes will become due and payable immediately without further action or notice. If any other event of default occurs and is continuing, then the trustee or the holders of at least 25% in aggregate principal amount of the 3.25 % Convertible Notes then outstanding may declare the 3.25 % Convertible Notes due and payable immediately. 2024 Capped Call Transactions In June 2024, we entered into privately negotiated capped call transactions in connection with the offering of the 3.25 % Convertible Notes (the “2024 capped call transactions”). The 2024 capped call transactions are expected generally to reduce the potential dilution to our common stock upon any conversion of the 3.25 % Convertible Notes and/or offset any cash payments we are required to make in excess of the principal amount of converted 3.25 % Convertible Notes, as the case may be. However, when the market price per share of our common stock, as measured under the terms of the 2024 capped call transactions, exceeds the cap price of $ 119.82 of the 2024 capped call transactions, there would nevertheless be dilution and/or there would not be an offset of such cash payments, in each case, to the extent that such market price exceeds the cap price of the 2024 capped call transactions. 3.75 % Convertible Notes On May 11, 2023, we issued $ 373.8 million aggregate principal amount of our 3.75 % Convertible Notes. The 3.75 % Convertible Notes bear interest at a rate of 3.75 % per annum payable semiannually in arrears on May 15 and November 15 of each year and mature on May 15, 2028, unless earlier converted, redeemed or repurchased. The indenture governing the 3.75 % Convertible Notes contains customary events of default. In the case of an event of default arising from certain events of bankruptcy, insolvency or reorganization, with respect to us or our significant subsidiaries, all outstanding 3.75 % Convertible Notes will become due and payable immediately without further action or notice. If any other event of default occurs and is continuing, then the trustee or the holders of at least 25 % in aggregate principal amount of the 3.75 % Convertible Notes then outstanding may declare the 3.75 % Convertible Notes due and payable immediately. 2023 Capped Call Transactions In May 2023, we entered into capped call transactions (the “2023 capped call transactions”) in connection with the offering of the 3.75 % Convertible Notes. The 2023 capped call transactions are expected generally to reduce the potential dilution to our common stock upon conversion of the 3.75 % Convertible Notes and/or offset any cash payments we are required to make in excess of the principal amount of converted 3.75 % Convertible Notes, as the case may be. However, when the market price per share of our common stock, as measured under the terms of the 2023 capped call transactions, exceeds the cap price of $ 79.83 of the 2023 capped call transactions, there would nevertheless be dilution and/or there would not be an offset of such cash payments, in each case, to the extent that such market price exceeds the cap price of the 2023 capped call transactions. Exchange Agreements On February 18, 2026, we entered into separate and privately negotiated agreements (the “Exchange Agreements”) with a limited number of holders of the 3.75 % Convertible Notes pursuant to which we agreed to exchange $ 100.0 million aggregate principal amount of the 3.75 % Convertible Notes for cash consideration (each such note, the “Exchanged Notes,” and each such transaction, a “Note Exchange Transaction”). The consideration payable under the Exchange Agreements was based, in part, on the volume-weighted average price of our common stock during a 15 trading-day measurement period beginning on February 18, 2026. The terms of the Note Exchange Transactions met the criteria for induced conversion accounting under ASU 2024-04. Under induced conversion accounting, we recognized an inducement expense measured as the fair value of the Exchanged Notes and additional consideration paid to bond holders to induce conversion in excess of the fair value of the securities issuable under the original conversion terms. On March 11, 2026, we settled the Note Exchange Transactions in cash for total consideration of $ 289.7 million, consisting of $ 288.5 million paid to settle the Note Exchange Transactions and $ 1.2 million of accrued interest. We incurred $ 2.9 million of inducement expense and $ 6.8 million of related charges, which are included in Loss on convertible debt transactions, net in our Condensed Consolidated Statements of Operations. No shares of our common stock were issued in connection with the settlement of the Note Exchange Transactions. As of June 30, 2026, $ 273.7 million aggregate principal amount of the 3.75 % Convertible Notes remained outstanding. 23 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) Unwind of Associated Capped Call Agreements In connection with the Note Exchange Transactions, on February 18, 2026, we entered into partial unwind agreements (the “Unwind Agreements”) with certain financial institutions (the “Capped Call Counterparties”) to unwind a portion of the capped call transactions that were entered into in connection with the offering of the 3.75 % Convertible Notes. The Unwind Agreements relate to a number of call options corresponding to the number of Exchanged Notes. Pursuant to the Unwind Agreements, the Capped Call Counterparties paid to us an amount of cash in respect of the capped call transactions being unwound thereunder, which amount was determined based upon the volume-weighted average price per share of our common stock during an averaging period beginning on February 18, 2026. The transactions settled on March 10, 2026 and we received $ 56.7 million of cash proceeds. The capped call transactions were determined to be equity-classified at inception under ASC 815; accordingly, the proceeds from the partial unwind were recorded as a capital transaction within additional paid-in capital. Redemption of the 3.75 % Convertible Notes On the Call Notice Date, we called the outstanding $ 273.7 million aggregate principal amount of 3.75 % Convertible Notes for redemption on August 10, 2026. Holders of the 3.75 % Convertible Notes may convert their 3.75 % Convertible Notes at any time before the close of business on August 6, 2026. As a result of sending the notice of redemption, the conversion rate was increased for all conversions of 3.75 % Convertible Notes on or after the Call Notice Date and through the close of business on August 6, 2026 by 0.1309 shares of our common stock. The conversion rate (including the additional shares) for all conversions of 3.75 % Convertible Notes on or after the Call Notice Date and through the close of business on August 6, 2026 is 21.8116 shares of our common stock per $1,000 principal amount of 3.75 % Convertible Notes. We elected to settle conversions on or after the Call Notice Date and through the close of business on August 6, 2026 by paying cash up to $ 2,617.40 per $1,000 principal amount of the 3.75 % Convertible Notes to be converted (which, on an as-converted basis, corresponds to approximately $ 120.00 per share of our common stock) and delivering shares of our common stock in respect of the remainder, if any, of the conversion obligation in excess thereof. Prior to our irrevocable Conversion Election, we had the ability to settle the 3.75 % Convertible Notes using cash, shares, or any combination of the two. Accordingly, the embedded conversion option derivative qualified for the scope exception for contracts indexed to and settled in an entity’s own equity under ASC 815 and was not required to be accounted for as separate derivative instrument. Upon our Conversion Election, the embedded conversion option no longer qualified for the equity scope exception. We reassessed the embedded conversion option in accordance with ASC 815 and concluded it was required to be bifurcated and accounted for separately as a derivative liability as of the Call Notice Date, with a corresponding adjustment to the carrying amount of the 3.75 % Convertible Notes. Upon bifurcation of the conversion option on the Call Notice Date, we recorded an embedded conversion option derivative liability at fair value of $ 527.9 million, a debt discount of $ 273.7 million against the carrying value of the 3.75 % Convertible Notes, a $ 2.9 million expense of previously unamortized debt issuance costs, resulting in a $ 257.1 million Loss on convertible debt transactions, net. Subsequent to initial recognition, the embedded conversion option derivative liability must be remeasured at fair value at each reporting date, with changes in fair value recognized in earnings in accordance with ASC 815. The fair value of the embedded conversion option derivative liability recognized on our Condensed Consolidated Balance Sheets was $ 630.5 million as of June 30, 2026. We recognized a loss on derivative remeasurement in Loss on convertible debt transactions, net of $ 102.6 million in our Condensed Consolidated Statement of Operations during the three months ended June 30, 2026 which, along with the $ 257.1 million previously recorded at the Call Notice Date, resulted in a $ 359.7 million Loss on convertible debt transactions, net for the three months ended June 30, 2026. The debt discount associated with the bifurcation is amortized to interest expense over the remaining term of the 3.75 % Convertible Notes using the effective interest method in accordance with ASC 835, Interest . We recognized interest expense of $ 3.5 million in our Condensed Consolidated Statement of Operations during the three and six months ended June 30, 2026. The remainder of the debt discount will be amortized to interest expense during the three months ending September 30, 2026. The capped call transactions associated with the 3.75 % Convertible Notes continue to qualify for equity classification under ASC 815. 24 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) Credit Agreement On August 5, 2025, we entered into the Credit Agreement. The Credit Agreement consists of (1) a $ 600.0 million Revolver, (2) a $ 600.0 million senior secured term loan (the “Initial Term Loan”) and (3) an additional $ 75.0 million senior secured term loan (the “Delayed Draw Term Loan”). We borrowed $ 75.0 million under the Delayed Draw Term Loan on October 2, 2025 and repaid the amount outstanding thereunder on October 31, 2025. The Credit Agreement also includes an accordion feature that allows us to increase borrowings under the Revolver, request a new tranche of term loans, or issue one or more series of notes or loans or any bridge financing pursuant to financing documentation other than the Credit Agreement, or a combination thereof, in an amount not to exceed (1) the greater of (a) $ 535.0 million and (b) the amount equal to 100 % of Consolidated EBITDA (as defined in the Credit Agreement), calculated on a pro forma basis, plus (2) unlimited additional amounts so long as on a pro forma basis after giving effect to the incurrence of additional indebtedness and after giving effect to all other appropriate pro forma adjustments, the ratio of consolidated funded secured indebtedness to Consolidated EBITDA (as defined in the Credit Agreement) does not exceed 1.25 to 1.0, in each case, subject to lender approval. The Credit Agreement includes a $ 150.0 million sublimit for letters of credit ($ 75.0 million for financial letters of credit) and a $ 20.0 million sublimit for swingline loans. As of June 30, 2026, the total unused availability under the Revolver was $ 584.9 million, resulting from $ 15.1 million in issued and outstanding letters of credit and no amount drawn under the Revolver. The letters of credit had expiration dates between August 2026 and June 2027. During the second quarter, we borrowed and repaid $ 170.0 million on the Revolver. We may borrow under the Credit Agreement, at our option, at either (a) term SOFR plus an applicable margin ranging from 1.25 % to 2.0 %, or (b) a base rate plus an applicable margin ranging from 0.25 % to 1.0 %. The applicable margin will be based on our consolidated leverage ratio set forth on the most recent compliance certificate delivered quarterly. In addition, we have agreed to pay an unused commitment fee ranging from 0.175 % to 0.350 %, depending on our consolidated leverage ratio set forth on the most recent compliance certificate delivered quarterly. The Initial Term Loan and Revolver will mature on August 5, 2030. The Initial Term Loan will amortize at 2.5 % per year payable in quarterly installments beginning with the quarter ending December 31, 2026 through September 30, 2027 and increasing to 5.0 % per year payable in quarterly installments until the maturity date. Covenants and Events of Default Our Credit Agreement requires us to comply with various affirmative, restrictive and financial covenants, including the financial covenants described below. Our failure to comply with these covenants following any relevant cure periods would constitute an event of default under the Credit Agreement. The indentures governing our 3.25 % Convertible Notes, our 3.75 % Convertible Notes and our 6.375 % Senior Notes also require us to comply with various covenants. Our failure to comply with these covenants following any relevant cure periods would constitute an event of default under the indentures governing our 3.25 % Convertible Notes, our 3.75 % Convertible Notes and our 6.375 % Senior Notes. Additionally, our failure to pay principal, interest or other amounts when due or within the relevant grace period on our 6.375 % Senior Notes, our 3.25 % Convertible Notes, our 3.75 % Convertible Notes or our Credit Agreement would constitute an event of default under the 6.375 % Senior Notes indenture, the 3.25 % Convertible Notes indenture, the 3.75 % Convertible Notes indenture or the Credit Agreement. A default under our Credit Agreement could result in (i) us no longer being entitled to borrow under such facility; (ii) the termination of such facility; (iii) the requirement that any letters of credit under such facility be cash collateralized; (iv) the acceleration of amounts owed under the Credit Agreement; and/or (v) the foreclosure on any collateral securing the obligations under such facility. A default under the 6.375 % Senior Notes indenture, the 3.25 % Convertible Notes indenture or the 3.75 % Convertible Notes indenture could result in acceleration of the maturity of the notes. The financial covenants under the terms of our Credit Agreement require the maintenance of a minimum Consolidated Interest Coverage Ratio and a maximum Consolidated Leverage Ratio. As of June 30, 2026, we were in compliance with all covenants contained in the Credit Agreement and in the indentures governing our notes. We are not aware of any non-compliance by any of our unconsolidated real estate ventures with the covenants contained in their debt agreements. Debt Issuance Costs During the three and six months ended June 30, 2026, we capitalized $ 9.9 million in third party offering costs related to the issuance of the 6.375 % Senior Notes. These debt issuance costs will be amortized over the expected life of the 6.375 % Senior Notes. 25 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) 15. Other (income) expense, net The components of the Total other (income) expense, net are as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2026 2025 2026 2025 Loss on convertible debt transactions, net (1) $ 359,719 $ — $ 369,423 $ — Interest income ( 5,147 ) ( 5,761 ) ( 10,996 ) ( 12,029 ) Interest expense (2) 21,761 7,927 38,093 15,684 Equity in income of affiliates, net ( 5,697 ) ( 3,698 ) ( 9,170 ) ( 4,792 ) Other income, net ( 4,492 ) ( 2,462 ) ( 3,831 ) ( 2,525 ) Total other (income) expense, net 366,144 ( 3,994 ) 383,519 ( 3,662 ) (1) The loss on convertible debt transactions, net includes $ 356.7 million and $ 363.5 million of loss on derivative remeasurement related to the 3.75 % Convertible Notes during the three and six months ended June 30, 2026, respectively. See Note 14 for details. (2) Interest expense includes $ 3.5 million related to the amortization of convertible debt discount associated with the 3.75 % Convertible Notes during the three and six months ended June 30, 2026. See Note 14 for details. 16. Weighted Average Shares Outstanding and Net Income (Loss) Per Share The following table presents a reconciliation of the weighted average shares of common stock used in calculating basic and diluted net income (loss) per share as well as the calculation of basic and diluted net income (loss) per share: Three Months Ended June 30, Six Months Ended June 30, (in thousands, except per share amounts) 2026 2025 2026 2025 Numerator Net income (loss) attributable to common shareholders $ ( 278,162 ) $ 71,700 $ ( 319,861 ) $ 38,044 Add: Interest expense related to Convertible Notes — 2,994 — 5,988 Net income (loss) attributable to common shareholders for diluted earnings per share $ ( 278,162 ) $ 74,694 $ ( 319,861 ) $ 44,032 Denominator Weighted average common shares outstanding, basic 43,751 43,746 43,641 43,605 Add: Dilutive effect of RSUs — 543 — 564 Add: Dilutive effect of Convertible Notes — 8,466 — 8,447 Weighted average common shares outstanding, diluted 43,751 52,755 43,641 52,616 Net income (loss) per share, basic $ ( 6.36 ) $ 1.64 $ ( 7.33 ) $ 0.87 Net income (loss) per share, diluted $ ( 6.36 ) $ 1.42 $ ( 7.33 ) $ 0.84 Basic net income (loss) per share attributable to common stockholders is calculated by dividing net income (loss) attributable to common stockholders by the weighted average shares of common stock outstanding for the period. Diluted net income (loss) per share attributable to common stockholders includes the effect of potentially dilutive securities when their effect is dilutive. Potentially dilutive securities consist of unvested RSUs, which are included using the treasury stock method, and shares issuable upon conversion of the 3.25 % Convertible Notes and 3.75 % Convertible Notes, which are included using the if-converted method. Due to net losses for the three and six months ended June 30, 2026, 488,000 and 509,000 shares related to unvested RSUs and 7,983,000 and 8,705,000 shares related to the potential conversion of the convertible notes, respectively, were excluded from the calculation of diluted weighted average shares outstanding because their inclusion would have been anti-dilutive. 26 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) The capped call transactions associated with the 3.25 % Convertible Notes and 3.75 % Convertible Notes were not included in the calculation of diluted weighted average shares outstanding because their effect would have been anti-dilutive. 17. Income Taxes The following table presents the provision for income taxes for the respective periods: Three Months Ended June 30, Six Months Ended June 30, (dollars in thousands) 2026 2025 2026 2025 Provision for income taxes $ 32,248 $ 27,214 $ 20,129 $ 15,458 Effective tax rate ( 13.5 %) 25.3 % ( 7.0 %) 22.9 % Our effective tax rate for the three and six months ended June 30, 2026 is lower than the prior period primarily due to nondeductible losses on convertible debt transactions and the related amortization of convertible debt discount, as described in Note 15 of “Notes to the Condensed Consolidated Financial Statements.” 18. Contingencies - Legal Proceedings Liabilities relating to legal proceedings and government inquiries, to the extent that we have concluded such liabilities are probable and the amounts of such liabilities are reasonably estimable, are recorded in the consolidated balance sheets. Disclosure is required when a material loss is probable but not reasonably estimable, a material loss is reasonably possible but not probable, or when it is reasonably possible that the amount of a loss will exceed the amount recorded. The total liabilities recorded in our condensed consolidated balance sheets for legal proceedings and government inquiries were immaterial as of June 30, 2026 and December 31, 2025. It is possible that future developments in our legal proceedings and inquiries could require us to (i) adjust or reverse existing accruals, or (ii) record new accruals that we did not originally believe to be probable or that could not be reasonably estimated. Such changes could be material to our financial condition, results of operations and/or cash flows in any particular reporting period. Ordinary Course Legal Proceedings In the ordinary course of business, we and our affiliates are involved in various legal proceedings alleging, among other things, liability issues or breach of contract or tortious conduct in connection with the performance of services and/or materials provided, the various outcomes of which often cannot be predicted with certainty. For information on our accounting policies regarding affirmative claims and back charges that we are party to in the ordinary course of business, see Note 1 of our Annual Report. We and our affiliates are also subject to government inquiries in the ordinary course of business seeking information concerning our compliance with government construction contracting requirements and various laws and regulations, the outcomes which often cannot be predicted with certainty. Some of the matters in which we or our joint ventures and affiliates are involved may involve compensatory, punitive, or other claims or sanctions that, if granted, could require us to pay damages or make other expenditures in amounts that are not probable to be incurred or cannot currently be reasonably estimated. In addition, in some circumstances our government contracts could be terminated, we could be suspended, debarred or incur other administrative penalties or sanctions, or payment of our costs could be disallowed. While any of our pending legal proceedings may be subject to early resolution as a result of our ongoing efforts to resolve the proceedings, whether or when any legal proceeding will be resolved is neither predictable nor guaranteed. 27 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) 19. Reportable Segment Information We manage our operations under two reportable segments, Construction and Materials, which are distinguished by differences in business activities. Our reportable segments are the same as our operating segments and correspond with how our chief operating decision maker (“CODM”) regularly reviews financial information to allocate resources and assess performance. We identified our CODM as our Chief Executive Officer. Our CODM evaluates segment performance and makes business decisions based on operating income, which excludes non-operating income or expense. Segment assets include property and equipment, intangibles, goodwill, inventory and equity in construction joint ventures. Summarized segment information is as follows (in thousands): Three months ended June 30, Construction Materials Total 2026 Total revenue from reportable segments $ 1,207,479 $ 364,849 $ 1,572,328 Elimination of intersegment revenue — ( 116,456 ) ( 116,456 ) Revenue 1,207,479 248,393 1,455,872 Cost of revenue 1,008,785 208,316 1,217,101 Gross profit 198,694 40,077 238,771 Selling, general and administrative expenses 61,267 8,928 70,195 (Gain) loss on sales of property and equipment, net ( 2,062 ) 86 ( 1,976 ) Operating income from reportable segments $ 139,489 $ 31,063 $ 170,552 Depreciation, depletion and amortization $ 17,472 $ 27,379 $ 44,851 2025 Total revenue from reportable segments $ 937,426 $ 251,856 $ 1,189,282 Elimination of intersegment revenue — ( 63,318 ) ( 63,318 ) Revenue 937,426 188,538 1,125,964 Cost of revenue 783,760 143,105 926,865 Gross profit 153,666 45,433 199,099 Selling, general and administrative expenses 48,323 6,022 54,345 Gain on sales of property and equipment, net ( 679 ) ( 2,061 ) ( 2,740 ) Operating income from reportable segments $ 106,022 $ 41,472 $ 147,494 Depreciation, depletion and amortization $ 19,223 $ 14,273 $ 33,496 28 Table of Contents GRANITE CONSTRUCTION INCORPORATED NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED (Unaudited) Six Months Ended June 30, Construction Materials Total 2026 Total revenue from reportable segments $ 1,973,533 $ 562,340 $ 2,535,873 Elimination of intersegment revenue — ( 167,536 ) ( 167,536 ) Revenue 1,973,533 394,804 2,368,337 Cost of revenue 1,672,659 347,002 2,019,661 Gross profit 300,874 47,802 348,676 Selling, general and administrative expenses 133,443 20,842 154,285 (Gain) loss on sales of property and equipment, net ( 6,303 ) 1,378 ( 4,925 ) Operating income from reportable segments $ 173,734 $ 25,582 $ 199,316 Depreciation, depletion and amortization $ 37,675 $ 47,762 $ 85,437 Segment assets as of period end $ 805,550 $ 1,441,161 $ 2,246,711 2025 Total revenue from reportable segments $ 1,552,044 $ 357,436 $ 1,909,480 Elimination of intersegment revenue — ( 83,969 ) ( 83,969 ) Revenue 1,552,044 273,467 1,825,511 Cost of revenue 1,312,940 229,623 1,542,563 Gross profit 239,104 43,844 282,948 Selling, general and administrative expenses 110,650 14,567 125,217 Gain on sales of property and equipment, net ( 2,528 ) ( 2,130 ) ( 4,658 ) Operating income from reportable segments $ 130,982 $ 31,407 $ 162,389 Depreciation, depletion and amortization $ 33,675 $ 27,828 $ 61,503 Segment assets as of period end $ 615,962 $ 687,175 $ 1,303,137 A reconciliation of operating income from reportable segments to consolidated income (loss) before income taxes is as follows: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2026 2025 2026 2025 Total operating income from reportable segments $ 170,552 $ 147,494 $ 199,316 $ 162,389 Corporate selling, general and administrative expenses 37,599 31,542 94,459 76,581 Corporate (gain) loss on sales of property and equipment, net 739 ( 866 ) 739 ( 685 ) Other costs, net 5,406 13,253 8,443 22,679 Total operating income 126,808 103,565 95,675 63,814 Total other (income) expense, net 366,144 ( 3,994 ) 383,519 ( 3,662 ) Income (loss) before income taxes $ ( 239,336 ) $ 107,559 $ ( 287,844 ) $ 67,476 29 Table of Contents