v3.26.1
Stock-Based Compensation and Long-term Incentive Awards
 6 Months Ended
Jun. 30, 2026
Share-Based Payment Arrangement [Abstract]  
Stock-Based Compensation and Long-term Incentive Awards Stock-Based Compensation and Long-term Incentive Awards
Management Aggregator I and Management Aggregator II issue Series A Interests and Restricted Series C Interests to the Company’s employees. Series A Interests awards are comprised of time vesting interests (60%) (“Time Interests”), performance vesting interests (20%) (“Performance Interests”), and exit vesting interests (20%) (“Exit Interests”). The Management Aggregators are solely responsible for settling these awards and cannot direct Legence Holdings to settle or declare distributions for such purpose. The Time Interests and Restricted Series C Interests are remeasured at fair value each period, with changes recognized as capital contributions from the Management Aggregators through Legence Parent and Legence Parent II.

Series A Interests
The compensation expense for Time Interests was as follows (in thousands):
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Selling, general and administrative$41,783 $5,918 $67,067 $2,275 
Cost of revenue10,200 1,509 16,754 666 
Compensation expense$51,983 $7,427 $83,821 $2,941 
For the three and six months ended June 30, 2026, the Parent Entities distributed $34.7 million and $45.8 million, respectively, to holders of Time Interests, which are included in the Company’s compensation expense. There were no distributions for Time Interests for the three and six months ended June 30, 2025. As of June 30, 2026, the unrecognized compensation expense related to Time Interests is approximately $24.6 million to be recognized over a remaining weighted-average term of 3.2 years.
The compensation expense for Performance Interests was as follows (in thousands):
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Selling, general and administrative$9,538 $— $12,593 $— 
Cost of revenue2,253 — 2,961 — 
Compensation expense
$11,791 $— $15,554 $— 
Payments related to the Performance Interests and Exit Interests are contingent upon the achievement of specified market thresholds and require the recipient’s continued employment through distribution dates. Once the applicable thresholds are achieved, holders are entitled to receive payments upon each qualifying distribution from the Parent Entities. For the three and six months ended June 30, 2026, the Parent Entities distributed $11.8 million and $15.6 million, respectively, to holders of Performance Interests, which are included in the Company’s compensation expense. There were no distributions for Performance Interests for the three and six months ended June 30, 2025. There were no distributions for Exit Interests and no compensation expense recorded for Exit Interests for the three and six months ended June 30, 2026 or 2025. Because additional distributions are dependent on future liquidity events that are not considered probable as of the financial statement dates, no compensation was accrued for these awards as of June 30, 2026 or December 31, 2025.
Restricted Series C Interests
The compensation expense for Restricted Series C Interests was as follows (in thousands):
Three Months Ended June 30,Six Months Ended June 30,
2026202520262025
Selling, general and administrative$682 $124 $1,041 $137 
Cost of revenue817 148 1,247 163 
Compensation expense$1,499 $272 $2,288 $300 
For the three and six months ended June 30, 2026, the Parent Entities distributed $1.0 million and $1.3 million, respectively, to holders of Restricted Series C Interests, which are included in the Company’s compensation expense. There were no distributions for Restricted Series C Interests for the three and six months ended June 30, 2025. As of June 30, 2026, the unrecognized compensation expense related to Restricted Series C Interests is approximately $2.0 million to be recognized over a remaining weighted-average term of 2.4 years.