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Sep 26
Mercury Q1 2026 Earnings Report
Mercury Systems posted a narrower net loss in Q1 2026 and delivered solid growth across revenue, bookings, and adjusted EBITDA.
Key Takeaways
Mercury Systems reported Q1 2026 revenue of $225.2 million and a net loss of $12.5 million, an improvement from the prior year. The company recorded strong bookings, a book-to-bill ratio above 1, and expanded its backlog to a record $1.4 billion. Adjusted EBITDA and adjusted EPS showed significant gains, reflecting improved operational execution.
Revenue reached $225.2 million, up 10.2% year-over-year
Net loss narrowed to $12.5 million from $17.5 million a year earlier
Adjusted EBITDA increased to $35.6 million, up from $21.5 million
Backlog hit a record $1.4 billion, with a book-to-bill ratio of 1.11
Mercury
Mercury
Mercury Revenue by Geographic Location
Revenue by Geographic Location
United States Revenue
CapyFin.com Forward Guidance
Mercury expects continued strength in bookings and backlog driven by execution across key programs and improved operating leverage, while maintaining a focus on free cash flow and structural cost management.
Positive Outlook
- Strong order activity sustained book-to-bill above 1.0
- Backlog supports future revenue visibility
- Adjusted EBITDA margin improved significantly YoY
- Free cash flow improved by over $16 million YoY
- Revolving credit facility extended to support liquidity
Challenges Ahead
- GAAP net loss continued despite revenue growth
- Free cash flow remained negative in the quarter
- Operating income still in negative territory
- Gross margin impacted by elevated cost of revenues
- R&D investment declined, potentially impacting future innovation