Shares of Geo Group Inc (NYSE: GEO) surged over 5% in Thursday's pre-market trading session, following the company's announcement of a major new contract award from U.S. Immigration and Customs Enforcement (ICE).

On Wednesday, Geo Group disclosed that it has secured a 15-year, fixed-price contract worth approximately $1 billion from ICE. The contract involves providing support services for a federal immigration processing center at Geo's 1,000-bed Delaney Hall facility in Newark, New Jersey.

The new contract is expected to generate over $60 million in annualized revenue for Geo Group in the first full year of operations, with margins consistent with the company's other secure services facilities. Geo anticipates reactivating the Delaney Hall facility in the second quarter of 2025, with revenues and earnings from the contract normalizing in the second half of the year.

This significant long-term contract win comes on the heels of Geo Group's fourth-quarter 2024 earnings report, where the company reported revenue of $607.7 million, beating estimates of $607.4 million. However, adjusted earnings of $0.13 per share missed the consensus estimate of $0.22.

Despite the earnings miss, Geo Group issued a positive outlook for 2025, projecting adjusted EBITDA between $460 million and $485 million on revenues of around $2.5 billion. The company also expects to further reduce its total net debt by $150 million to $175 million this year.

With the new $1 billion ICE contract providing substantial revenue visibility and the company's overall positive 2025 guidance, investors appear optimistic about Geo Group's prospects, driving the stock higher in pre-market trading on Thursday.