SAIC Announces Third Quarter of Fiscal Year 2026 Results (Form 8-K)

SAIC Announces Third Quarter of Fiscal Year 2026 Results

•Revenues of $1.87 billion

•Net bookings of $2.2 billion; book-to-bill ratio and trailing twelve months book-to-bill ratio of 1.2

•Year-to-date net bookings of $7.2 billion; year-to-date book-to-bill ratio of 1.3

•Net income of $78 million; Adjusted EBITDA(1) of $185 million or 9.9% of revenues

•Diluted earnings per share of $1.69; Adjusted diluted earnings per share(1) of $2.58

•Cash flows provided by operating activities of $129 million; Free cash flow(1) of $135 million

•Company increases fiscal year 2026 guidance on certain key metrics

RESTON, VA, December 4, 2025-Science Applications International Corporation (NASDAQ: SAIC), a premier Fortune 500 technology integrator driving our nation's digital transformation across the defense, space, civilian, and intelligence markets, today announced results for the third quarter ended October 31, 2025.

"Our third quarter results reflect a 5.6% revenue contraction, slightly ahead of our guidance when adjusting for the approximate 1% headwind from the government shutdown, and strong margins due to continued sound program execution," said Jim Reagan, SAIC Interim Chief Executive Officer. "My priority as interim CEO is to focus the company for long-term shareholder value creation. We have already begun implementing the initial changes to fuel growth and drive margins higher while maintaining our capital allocation framework centered around our share repurchase program."

Third Quarter of Fiscal Year 2026: Summary Operating Results

			Three Months Ended
			October 31, 2025						Percent change						November 1, 2024
			(dollars in millions, except per share amounts)
Revenues			$	1,866					(6)		%				$	1,976
Operating income			128						(20)		%				160
Operating income as a percentage of revenues			6.9		%				-120bps						8.1		%
Adjusted operating income(1)			183						(6)		%				195
Adjusted operating income as a percentage of revenues			9.8		%				-10bps						9.9		%
Net income			78						(26)		%				106
EBITDA(1)			168						(15)		%				197
EBITDA as a percentage of revenues			9.0		%				-100bps						10.0		%
Adjusted EBITDA(1)			185						(6)		%				197
Adjusted EBITDA as a percentage of revenues			9.9		%				-10bps						10.0		%
Diluted earnings per share			$	1.69					(21)		%				$	2.13
Adjusted diluted earnings per share(1)			$	2.58					(1)		%				$	2.61
Net cash provided by operating activities			$	129					(10)		%				$	143
Free cash flow(1)			$	135					1,400		%				$	9

(1)Non-GAAP measure, see Schedule 6 for information about this measure.

Third Quarter Summary Results

Revenues for the quarter decreased $110 million or 6% compared to the same period in the prior year primarily due to ramp down in volume on existing contracts, including approximately $16 million attributable to the government shutdown, and contract completions, partially offset by new contracts. Revenues recognized from the acquisition of SilverEdge for the three months ended October 31, 2025 were immaterial.

Operating income as a percentage of revenues for the quarter decreased compared to the same period in the prior year primarily due to executive transition costs, net of recoveries, and the favorable resolution of the Assault Amphibious Vehicle ("AAV") contract termination in the prior year ($14 million), partially offset by timing and volume mix in our contract portfolio.

Adjusted EBITDA(1) as a percentage of revenues for the quarter decreased to 9.9% from 10.0% for the same period in the prior year primarily due to the favorable resolution of the AAV contract termination in the prior year ($14 million), partially offset by timing and volume mix in our contract portfolio.

Diluted earnings per share for the quarter was $1.69 compared to $2.13 in the prior year quarter. Adjusted diluted earnings per share(1) for the quarter was $2.58 compared to $2.61 in the prior year quarter. The weighted-average diluted shares outstanding during the quarter decreased to 46.1 million from 49.8 million during the prior year quarter.

(1)Non-GAAP measure, see Schedule 6 for information about this measure.

Cash Generation and Capital Deployment

Cash flows provided by operating activities for the third quarter decreased $14 million compared to the prior year quarter primarily due to higher cash outflows from the usage of the Master Accounts Receivable Purchase Agreement ("MARPA Facility") in the current year and other changes in working capital, partially offset by timing of customer collections.

During the quarter, SAIC deployed $120 million of capital, primarily consisting of $94 million of plan share repurchases and $17 million in cash dividends.

Quarterly Dividend Declared

Subsequent to quarter end, on December 2, 2025, the Company's Board of Directors declared a cash dividend of $0.37 per share of the Company's common stock payable on January 28, 2026 to stockholders of record on January 14, 2026. SAIC intends to continue paying dividends on a quarterly basis, although the declaration of any future dividends will be determined by the Board of Directors each quarter and will depend on earnings, financial condition, capital requirements and other factors.

Backlog and Contract Awards

Net bookings for the quarter and year were approximately $2.2 billion and $7.2 billion, respectively, which reflects a book-to-bill ratio of 1.2 and 1.3, respectively, and a trailing twelve months book-to-bill ratio of 1.2. SAIC's estimated backlog at the end of the quarter was approximately $23.8 billion. Of the total backlog amount, approximately $3.8 billion was funded.

Notable New and Recompete Awards:

U.S Air Force: During the quarter, SAIC was awarded the $1.4 billion Collaborative Operations for Battlespace Resilient Architecture ("COBRA") task order in support of the U.S. Air Force. Under this five year (one-year base, plus four, one-year option periods) task order SAIC will provide engineering services to the Department of the Air Force, leveraging its expertise in IT modernization, mission solutions, and digital transformation.

U.S. Army: During the quarter, SAIC was awarded a $413 million, five-year (one-year base, plus four, one-year option periods) Open Source Intelligence Enterprise ("OSINT") task order. The core purpose of the task order is to operationalize OSINT for the Department of the Army, mission partners, and for the Intelligence Community including defense, civilian, and partner nation intelligence organizations. Execution of this task order will inform and implement Army policy as well as provide access to, training for, and management and oversight of enterprise-approved OSINT capabilities for the Army and the broader Intelligence Community.

U.S. Navy: During the quarter, SAIC was awarded a $171 million, 5-year contract with the U.S. Navy. The objective of this effort is to perform R&D to modify and upgrade legacy technology and identify and develop new technology for expeditionary, including low altitude, Multi-Mission Electromagnetic Warfare ("MMEW") systems to address capability, readiness, and sustainment gaps for Department of War ("DoW", formerly referred to as the Department of Defense) and Other Government Agencies ("OGAs") systems. The goal is to develop the future generations of advanced MMEW and Electromagnetic Warfare Management ("EWM") systems, Force Level Electromagnetic Warfare ("FLEW"), and Electromagnetic Spectrum Operations ("EMSO").

Naval Undersea Warfare Center: SAIC was awarded a $242 million, five-year single-award indefinite delivery, indefinite quantity (IDIQ) contract by the Naval Undersea Warfare Center to operate, maintain, and upgrade certain key facilities. The NP Propulsion Test Facility (PTF) Torpedoes contract supports testing services, (including, but not limited to, assembly, integration, and breakdown of Test Articles, execution of tests, and troubleshooting of test systems) Torpedo Test Equipment Services (including, but not limited to, fabrication, refurbishment, upgrades, and mitigating obsolescence issues) and Engineering and Technical services (including, but not limited to, design, drafting, prototyping, remote technical support and troubleshooting). Net bookings and backlog for the quarter include $180 million related to this award.

U.S. Space and Intelligence Community: During the quarter, SAIC was awarded approximately $515 million of contract awards by space and intelligence organizations. These awards represent a combination of new business, modifications, and recompetes.

Other Notable News:

On October 15, 2025, SAIC acquired SilverEdge Government Solutions ("SilverEdge"), an innovative provider of mission-driven technology solutions and products, for a preliminary purchase price of $203 million, net of $6 million cash acquired, subject to post-closing adjustments. The acquisition advances the Company's strategy to provide mission focused, IP-based solutions and commercial products to its customers.

Fiscal Year 2026 Guidance

The table below summarizes fiscal year 2026 guidance and represents the Company's views as of December 4, 2025.

			CURRENT			PRIOR
			Fiscal Year			Fiscal Year
			2026 Guidance			2026 Guidance
Revenue			$7.275B - $7.325B			$7.250B - $7.325B
Adjusted EBITDA(1)			Approx. $695M			$680M - $690M
Adjusted EBITDA Margin %(1)			Approx. 9.5%			9.3% - 9.5%
Adjusted Diluted EPS(1)			$9.80 - $10.00			$9.40 - $9.60
Free Cash Flow(1)			>$550M			>$550M

(1)Non-GAAP measure, see Schedule 6 for information about this measure.

Webcast Information

SAIC management will discuss operations and financial results in an earnings conference call beginning at 10:00 a.m. Eastern time on December 4, 2025. The conference call will be webcast simultaneously to the public through a link on the Investor Relations section of the SAIC website (http://investors.saic.com). We will be providing webcast access only - "dial-in" access is no longer available. Additionally, a supplemental presentation will be available to the public through links to the Investor Relations section of the SAIC website. After the call concludes, an on-demand audio replay of the webcast can be accessed on the Investor Relations website.

About SAIC

SAIC® is a premier Fortune 500 mission integrator focused on advancing the power of technology and innovation to serve and protect our world. Our robust portfolio of offerings across the defense, space, civilian and intelligence markets includes secure high-end solutions in mission IT, enterprise IT, engineering services and professional services. We integrate emerging technology, rapidly and securely, into mission critical operations that modernize and enable critical national imperatives.

We are approximately 24,000 strong; driven by mission, united by purpose, and inspired by opportunities. Headquartered in Reston, Virginia, SAIC has annual revenues of approximately $7.5 billion. For more information, visit saic.com. For ongoing news, please visit our newsroom.

Contacts

Investor Relations: Joe DeNardi, [email protected]

Media: Kara Ross, [email protected]

GAAP to Non-GAAP Guidance Reconciliation

The Company does not provide a reconciliation of forward-looking adjusted diluted EPS to GAAP diluted EPS, adjusted EBITDA margin to GAAP net income or free cash flow to GAAP net cash flows from operating activities due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation. Because certain deductions for non-GAAP exclusions used to calculate net income and cash flows from operating activities may vary significantly based on actual events, the Company is not able to forecast GAAP diluted EPS, GAAP net income or GAAP net cash flows from operating activities with reasonable certainty. The variability of the above charges may have an unpredictable and potentially significant impact on our future GAAP financial results.