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., Dec. 04, 2025 (GLOBE NEWSWIRE) -- 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
Percentchange
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 (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,
Media: Kara Ross,
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.
Forward-Looking Statements
Certain statements in this release contain or are based on "forward-looking" information within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by words such as "expects," "intends," "plans," "anticipates," "believes," "estimates," "guidance," and similar words or phrases. Forward-looking statements in this release may include, among others, estimates of future revenues, operating income, earnings, earnings per share, charges, total contract value, backlog, outstanding shares and cash flows, as well as statements about future dividends, share repurchases and other capital deployment plans. Such statements are not guarantees of future performance and involve risk, uncertainties and assumptions, and actual results may differ materially from the guidance and other forward-looking statements made in this release as a result of various factors. Risks, uncertainties and assumptions that could cause or contribute to these material differences include those discussed in the "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Legal Proceedings" sections of our Annual Report on Form 10-K, as updated in any subsequent Quarterly Reports on Form 10-Q and other filings with the SEC, which may be viewed or obtained through the Investor Relations section of our website at www.saic.com or on the SEC's website at www.sec.gov. Due to such risks, uncertainties and assumptions you are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. SAIC expressly disclaims any duty to update any forward-looking statement provided in this release to reflect subsequent events, actual results or changes in SAIC's expectations. SAIC also disclaims any duty to comment upon or correct information that may be contained in reports published by investment analysts or others.
Schedule 1:
SCIENCE APPLICATIONS INTERNATIONAL CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF INCOME(Unaudited)
Three Months Ended
Nine Months Ended
October 31,2025
November 1,2024
October 31,2025
November 1,2024
(in millions, except per share amounts)
Revenues
$
1,866
$
1,976
$
5,512
$
5,641
Cost of revenues
1,639
1,739
4,861
4,981
Selling, general and administrative expenses
101
83
265
245
Other operating (income) expense
(2
)
(6
)
(2
)
(10
)
Operating income
128
160
388
425
Interest expense, net
33
32
94
97
Other (income) expense, net
1
2
6
7
Income before income taxes
94
126
288
321
Income tax (expense) benefit
(16
)
(20
)
(15
)
(57
)
Net income
$
78
$
106
$
273
$
264
Weighted-average number of shares outstanding:
Basic
45.9
49.4
46.7
50.6
Diluted
46.1
49.8
46.9
51.1
Earnings per share:
Basic
$
1.70
$
2.15
$
5.85
$
5.22
Diluted
$
1.69
$
2.13
$
5.82
$
5.17
Schedule 2:
SCIENCE APPLICATIONS INTERNATIONAL CORPORATIONCONDENSED CONSOLIDATED BALANCE SHEETS(Unaudited)
October 31,2025
January 31,2025
(in millions)
ASSETS
Current assets:
Cash and cash equivalents
$
45
$
56
Receivables, net
1,045
1,000
Prepaid expenses
145
78
Other current assets
22
20
Total current assets
1,257
1,154
Goodwill
2,960
2,851
Intangible assets, net
779
779
Property, plant, and equipment, net
108
104
Operating lease right of use assets
162
164
Other assets
157
194
Total assets
$
5,423
$
5,246
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable
$
627
$
631
Accrued payroll and employee benefits
308
339
Other accrued liabilities
103
113
Debt, current portion
12
313
Total current liabilities
1,050
1,396
Debt, net of current portion
2,475
1,907
Operating lease liabilities
159
173
Deferred income taxes
124
24
Other long-term liabilities
103
169
Equity:
Total stockholders' equity
1,512
1,577
Total liabilities and stockholders' equity
$
5,423
$
5,246
Schedule 3:
SCIENCE APPLICATIONS INTERNATIONAL CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited)
Three Months Ended
Nine Months Ended
October 31,2025
November 1,2024
October 31,2025
November 1,2024
(in millions)
Cash flows from operating activities:
Net income
$
78
$
106
$
273
$
264
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization
38
35
109
104
Stock-based compensation expense
26
13
51
38
Deferred income taxes
(8
)
(7
)
