Mercury Systems Inc (STU:MCY)

Q1 2026 Mercury Systems Inc Earnings Call Transcript

Nov 4, 2025 / 10:00 PM GMT

Release Date Price: €66 (-1.49%)

Transcript 10-Q8-K

Key Points

Positve

Mercury Systems Inc (MRCY) reported Q1 results that exceeded expectations with significant year-over-year growth in backlog, revenue, adjusted EBITDA, and free cash flow.
The company achieved a record backlog of $1.4 billion, supported by $250 million in bookings and a book-to-bill ratio of 1.11.
Revenue increased by 10.2% year-over-year to $225 million, demonstrating strong top-line growth.
Adjusted EBITDA margin improved by 530 basis points year-over-year to 15.8%, reflecting effective cost management and operational efficiency.
Mercury Systems Inc (MRCY) ended Q1 with $305 million in cash, highlighting strong liquidity and financial stability.

Negative

Despite the positive results, the company experienced a free cash outflow of $4.4 million, although this was an improvement from the previous year.
Operating expenses increased by 9.6% year-over-year, driven by higher compensation costs and litigation expenses.
The company anticipates Q2 revenue to be down year-over-year due to the accelerated delivery of high-margin backlog into Q1.
There is uncertainty regarding the timing and specifics of potential tailwinds from increased global defense budgets and domestic priorities like Golden Dome.
The company continues to work through constraints related to accelerating material from suppliers and factory constraints, which could impact future delivery timelines.

Refinitiv StreetEvents Event Transcript
E D I T E D V E R S I O N

MRCY.OQ - Mercury Systems Inc
Q1 2026 Mercury Systems Inc Earnings Call
Nov 04, 2025 / 10:00PM GMT

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Presentation
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Unidentified_1 [1]
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Good day, everyone, and welcome to the Mercury System's first quarter fiscal 2026 conference call.

Today's call is being recorded.

At this time, for opening remarks and introductions, I would like to turn the call over to the company's Vice President of Investor relations, Tyler Hojo.

Please go ahead, Mr.

Hojo.

Good afternoon and thank you for joining us.

With me today is our Chairman and Chief Executive Officer Bill Ballhouse and our executive Vice President, and CFfo Dave Farnsworth.

If you have not received a copy of the earnings press release we issued earlier this afternoon.

You can find it on our website at MRCy.com.

The slide presentation

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