SAIC Reports Second Quarter Of Fiscal Year 2026 Earnings Results

Science Applications International Corporation (SAIC) today announced its financial results for the most recent quarter, showcasing a strong performance that exceeded expectations. The company reported earnings per share (EPS) of $3.63, significantly surpassing the consensus estimate of $2.24, marking a notable beat of $1.39. This impressive result highlights SAIC’s robust operational capabilities and strategic initiatives in the current market landscape.

Key Highlights

• Revenues for Q2 FY2026 were $1.77 billion, reflecting a 3% contraction year-over-year.
• Net bookings totaled $2.6 billion, resulting in a book-to-bill ratio of 1.5 for the quarter.
• Year-to-date net bookings reached $5.0 billion, with a year-to-date book-to-bill ratio of 1.4.
• Net income for the quarter was $127 million, with an adjusted EBITDA of $185 million (10.5% of revenues).
• Diluted earnings per share increased to $2.71, up 72% from the previous year.
• Management has lowered revenue and adjusted EBITDA guidance for FY2026 but increased guidance for free cash flow and adjusted diluted earnings per share.
• Estimated backlog at the end of the quarter was approximately $23.2 billion, with $3.6 billion funded.

Summary

SAIC, Inc. reported its second quarter results for fiscal year 2026, showing revenues of $1.77 billion, which is a 3% decrease compared to the same period last year. The company experienced strong program performance and a significant increase in net bookings, which totaled $2.6 billion for the quarter, leading to a book-to-bill ratio of 1.5. However, CEO Toni Townes-Whitley noted that “slower on-contract growth and continued delays in new business awards and new program ramps are contributing to a more challenging revenue environment than previously forecasted.”

In response to these challenges, management is aligning the cost structure while maintaining key investments for long-term value creation. The revised guidance reflects a cautious outlook, assuming stability in the operating environment without improvement for the remainder of the year. The company anticipates revenues between $7.250 billion and $7.325 billion for FY2026, down from previous estimates, while also projecting an increase in free cash flow and adjusted diluted earnings per share.

Science Applications International Corporation (SAIC) has experienced a notable fluctuation in its stock price, with a recent decline of 4.38% over the past week, despite a more positive trajectory over the last three to six months, where it saw gains of 10.68% and 19.92%, respectively. This volatility may raise eyebrows among investors, especially considering the company’s price-to-earnings ratio of 16.04, which suggests that the stock is reasonably valued compared to its earnings potential. However, the two-year compound annual growth rate (CAGR) for revenue has dipped by 1.48%, indicating challenges in top-line growth that could be contributing to the recent price drop. On a brighter note, SAIC boasts a solid return on invested capital of 12.41% and a net profit margin of 4.69%, reflecting efficient management and profitability. Yet, the negative trends in free cash flow growth, which has decreased by 0.43% over the same period, may raise concerns about the company’s financial flexibility. As the market continues to react to these mixed signals, investors will be keenly watching how SAIC navigates its growth challenges while maintaining its operational efficiency. Overall, while the stock has shown resilience in the longer term, the recent downturn could signal a need for strategic adjustments moving forward.

Science Applications International Corporation provides technical, engineering, and enterprise information technology (IT) services primarily in the United States. The company’s offerings include engineering; technology integration; IT modernization; maintenance of ground and maritime systems; logistics; training and simulation; operation and program support services; and end-to-end services, such as design, development, integration, deployment, management and operations, sustainment, and security of its customers’ IT infrastructure, as well as cloud migration, managed services, infrastructure modernization, and enterprise IT-as-a-service solutions. It serves the U.S. military comprising Army, Air Force, Navy, Marines, and Coast Guard; Department of Defense agencies; National Aeronautics and Space Administration; the U.S. Department of State; Department of Justice; Department of Homeland Security; and various intelligence community agencies, as well as U.S. federal civilian agencies. The company was formerly known as SAIC Gemini, Inc. and changed its name to Science Applications International Corporation in September 2013. Science Applications International Corporation was founded in 1969 and is headquartered in Reston, Virginia.