Margin fade is the erosion of a job's projected gross margin over its life: bid at 11%, now forecast at 6%, that is 5 points of fade. The opposite, a margin that grows, is called gain.
Fade almost never arrives as a surprise on one day. It accumulates in places a monthly report does not look closely: a cost-to-complete that was never updated, change work performed but not yet priced, productivity running behind the estimate, or a sub's overrun that has not been invoiced yet. Then late in the job, when the budget runs out on a code, the whole thing lands at once.
Fade caught at 30% complete is a conversation with the owner, the sub or your own crew. Fade found at 90% complete is a write-down. The difference is how honestly cost-to-complete is updated every month.
Watching fade across your whole portfolio matters too. Sureties and lenders look at the pattern: a company whose jobs consistently fade is telling them its estimates or project controls are off, regardless of how any single job ends.