Kratos Defense Beats on Q3 Earnings, Raises '25 Revenue View

Kratos Defense & Security Solutions, Inc. KTOS reported third-quarter 2025 adjusted earnings of 14 cents per share, which beat the Zacks Consensus Estimate of 12 cents by 16.7%. The bottom line also increased 27.3% from the year-ago quarter’s 11 cents. Kratos Defense reported GAAP earnings of 5 cents per share compared with 2 cents in the third quarter of 2024.KTOS’ Total RevenuesTotal revenues were $347.6 million, which beat the Zacks Consensus Estimate of $324 million by 7.1%. The figure also rose 26% from $275.9 million recorded in the year-ago quarter. Kratos Defense & Security Solutions, Inc. Price, Consensus and EPS Surprise Kratos Defense & Security Solutions, Inc. price-consensus-eps-surprise-chart | Kratos Defense & Security Solutions, Inc. QuoteOperational Update of Kratos DefenseKratos Defense’s selling, general and administrative expenses increased 13.8% year over year. Research and development expenses increased 1% compared with the prior-year quarter. Depreciation expenses surged 16% year over year.Expenses related to the amortization of intangible assets increased 9.1% from the year-ago figure.The company reported operating income of $7.1 million, which increased from the year-ago quarter’s $6.5 million.It posted a consolidated book-to-bill ratio of 1.2-1, with bookings worth $414.1 million.The total backlog at the end of the third quarter was $1.178 billion compared with $1.076 billion at the end of the second quarter of 2025.KTOS’ Segmental PerformanceUnmanned Systems: Revenues from this segment totaled $87.2 million compared with $64.2 million in the year-ago quarter. Kratos Government Solutions: Revenues from this segment totaled $260.4 million compared with $211.7 million in the year-ago quarter. The most notable growth in this segment was in the company’s Defense Rocket Systems and Space, Training and Cyber businesses, with organic revenue growth rates of 47.2% and 21.2%, respectively, compared with the third quarter of 2024.Financial Details of KTOSAs of Sept. 28, 2025, cash and cash equivalents totaled $565.9 million, up from $329.3 million as of Dec. 29, 2024.The company reported no long-term debt as of Sept. 28, 2025, compared with $174.6 million recorded as of Dec. 29, 2024.The net cash used in operating activities amounted to $54.2 million during the first nine months of 2025 against $4.1 million net cash provided in the year-ago period.Kratos Defense’s GuidanceKTOS projects fourth-quarter 2025 revenues to be in the range of $320-$330 million. The Zacks Consensus Estimate for revenues is pegged at $324.5 million, lower than the mid-point of the company’s guided range.KTOS now expects 2025 revenues to be in the $1.32-$1.33 billion range, higher than the previous guidance of $1.29-$1.31 billion. The Zacks Consensus Estimate for revenues is pegged at $1.31 billion, which is below the company’s newly guided range.Kratos Defense expects operating cash flows to be in the range of $10-$20 million and free cash flow use to be in the band of $95-$105 million for 2025.KTOS’ Zacks RankKratos Defense currently has a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.Recent Defense ReleasesThe Boeing Company BA incurred an adjusted loss of $7.47 per share in the third quarter of 2025, wider than the Zacks Consensus Estimate of a loss of $3.68. The bottom line improved from the year-ago quarter’s reported loss of $10.44 per share.Its revenues amounted to $23.27 billion, which outpaced the Zacks Consensus Estimate of $21.92 billion by 6.2%. The top line also surged 30.4% from the year-ago quarter’s reported figure of $17.84 billion.Textron Inc. TXT reported third-quarter 2025 adjusted earnings of $1.55 per share, which beat the Zacks Consensus Estimate of $1.47 by 5.4%. The bottom line also rose 10.7% from $1.40 in the year-ago quarter.The company reported total revenues of $3.6 billion, which missed the Zacks Consensus Estimate of $3.71 billion by 2.8%. Moreover, revenues increased 4.9% from the year-ago quarter’s level of $3.43 billion.RTX Corporation’s RTX third-quarter 2025 adjusted earnings per share (EPS) of $1.70 beat the Zacks Consensus Estimate of $1.42 by 19.7%. The bottom line also improved 17.2% from the year-ago quarter’s level of $1.45.RTX’s third-quarter sales totaled $22.48 billion, which surpassed the Zacks Consensus Estimate of $21.48 billion by 4.6%. The top line also surged a solid 11.9% from $20.09 billion recorded for the third quarter of 2024. Zacks Names #1 Semiconductor StockThis under-the-radar company specializes in semiconductor products that titans like NVIDIA don't build. It's uniquely positioned to take advantage of the next growth stage of this market. And it's just beginning to enter the spotlight, which is exactly where you want to be.With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $971 billion by 2028.See This Stock Now for Free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report The Boeing Company (BA): Free Stock Analysis Report Textron Inc. (TXT): Free Stock Analysis Report Kratos Defense & Security Solutions, Inc. (KTOS): Free Stock Analysis Report RTX Corporation (RTX): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks