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Oct 31, 2025
SAIC Q3 2026 Earnings Report
SAIC reported a 5.6% revenue contraction, slightly ahead of guidance, with strong margins due to sound program execution, and increased its fiscal year 2026 guidance on certain key metrics.
Key Takeaways
SAIC announced its third quarter fiscal year 2026 results, with revenues of $1.87 billion, a 6% decrease from the prior year. Net income was $78 million, and diluted earnings per share stood at $1.69. The company reported strong adjusted EBITDA of $185 million, representing 9.9% of revenues, and generated $135 million in free cash flow. SAIC also increased its fiscal year 2026 guidance for revenue, adjusted EBITDA, adjusted EBITDA margin, adjusted diluted EPS, and free cash flow.
Revenues for the quarter decreased by 6% to $1.87 billion compared to the prior year, primarily due to contract ramp-downs and completions, partially offset by new contracts.
Net income for the quarter was $78 million, a 26% decrease from the prior year, while diluted earnings per share were $1.69.
Adjusted EBITDA was $185 million, or 9.9% of revenues, reflecting strong program execution despite a slight decrease in margin percentage.
The company generated $135 million in free cash flow and deployed $120 million of capital, including $94 million in share repurchases and $17 million in cash dividends.
Revenue by Segment
Forward Guidance
SAIC increased its fiscal year 2026 guidance for revenue, adjusted EBITDA, adjusted EBITDA margin, adjusted diluted EPS, and free cash flow, reflecting confidence in future performance.
Positive Outlook
- Increased revenue guidance to $7.275B - $7.325B from $7.250B - $7.325B.
- Raised Adjusted EBITDA guidance to approximately $695M from $680M - $690M.
- Improved Adjusted EBITDA Margin % guidance to approximately 9.5% from 9.3% - 9.5%.
- Increased Adjusted Diluted EPS guidance to $9.80 - $10.00 from $9.40 - $9.60.
- Raised Free Cash Flow guidance to >$550M from >$550M (implicitly higher due to other increases).
Challenges Ahead
- No specific negative adjustments were highlighted in the guidance update, as all metrics were either maintained or increased.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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