Kratos Defense Reports 36% Revenue Growth Amid Negative Free Cash Flow
Kratos Defense & Security Solutions (KTOS) reported a strong third quarter with revenue climbing 36% to $471.8 million, driven by robust demand that pushed new orders to more than double sales. This surge helped increase the company's backlog to $2.65 billion, up from $2.08 billion in the previous quarter. Despite top-line growth, the company faced profitability challenges as GAAP operating income swung to a loss of $4.9 million. High selling and administrative costs, alongside increased amortization from recent acquisitions, have pressured margins. Kratos continues to consume cash to fund its expansion, reporting a free cash flow use of $29.4 million for the quarter. The company expects heavy investment requirements to weigh on free cash flow through 2027. While stock sales provided $1.35 billion in capital over the first nine months, investors are closely watching how potential government continuing resolutions might impact future guidance.
Tickers: $KTOS
Topics: Backlog Increase Free Cash Flow Operating Loss Revenue Growth