Latest news with #LeonardoDRS
Bloomberg
21-05-2025
- Business
- Bloomberg
Italian Defense Firm Leonardo Closes in on Deal for US Tech Company
Leonardo SpA 's US unit is closing in on the purchase of an American technology firm, people familiar with the matter said, in a move that would bolster the defense contractor's product capabilities in the world's largest weapons market. Arlington, Virginia-based Leonardo DRS Inc. is considering a deal that would value the target in the low hundreds of millions in dollars, the people said, declining to identify the target. They asked not to be identified because the information isn't public. The potential acquisition provides predictive algorithm services, a technology that uses historical data to forecast future events.
Yahoo
15-05-2025
- Business
- Yahoo
DRS Q1 Earnings Call: Outperformance Driven by Defense Demand, Supply Chain Adjustments Highlight Risks
Aerospace and defense company Leonardo DRS (NASDAQ:DRS) reported revenue ahead of Wall Street's expectations in Q1 CY2025, with sales up 16.1% year on year to $799 million. The company expects the full year's revenue to be around $3.48 billion, close to analysts' estimates. Its non-GAAP profit of $0.20 per share was 21.7% above analysts' consensus estimates. Is now the time to buy DRS? Find out in our full research report (it's free). Revenue: $799 million vs analyst estimates of $731.8 million (16.1% year-on-year growth, 9.2% beat) Adjusted EPS: $0.20 vs analyst estimates of $0.17 (21.7% beat) Adjusted EBITDA: $82 million vs analyst estimates of $78.09 million (10.3% margin, 5% beat) The company reconfirmed its revenue guidance for the full year of $3.48 billion at the midpoint Management reiterated its full-year Adjusted EPS guidance of $1.05 at the midpoint EBITDA guidance for the full year is $445 million at the midpoint, below analyst estimates of $449.4 million Operating Margin: 7.4%, up from 6.3% in the same quarter last year Free Cash Flow was -$170 million compared to -$275 million in the same quarter last year Backlog: $8.61 billion at quarter end, up 9.8% year on year Market Capitalization: $10.74 billion Leonardo DRS began the year with results that surpassed Wall Street expectations, driven by robust customer demand across its defense technology portfolio and the favorable timing of material receipts. CEO Bill Lynn emphasized that the company's backlog reached $8.61 billion, underpinned by continued order strength in advanced infrared sensing, electric power and propulsion, and tactical radars. Management credited the acceleration of supplier deliveries and operational improvements for the quarter's revenue growth, noting that domestic programs were the primary contributors while international sales saw a temporary dip due to delivery timing. Looking ahead, management reaffirmed its full-year revenue and adjusted profit guidance, pointing to strong backlog visibility and consistent demand from U.S. defense customers. CFO Mike Dippold highlighted that quarterly results benefitted from early material receipts, which are expected to improve revenue linearity throughout the year. However, the team also acknowledged potential headwinds, including volatile germanium prices impacting margins and ongoing scrutiny of supply chain resilience. Management stressed that investments in facility expansion and technology development are intended to align DRS with evolving defense priorities and ensure readiness for future opportunities. Leonardo DRS's first quarter was shaped by a combination of strong domestic demand, operational shifts, and supply chain adjustments. Management outlined several business dynamics that influenced both the quarter's results and their expectations for the remainder of the year. Supply Chain Acceleration: The company attributed its revenue overperformance to accelerated supplier deliveries, which allowed certain material receipts to be recognized earlier than forecasted. CFO Mike Dippold indicated that this shift was broad-based rather than confined to specific programs, leading to improved confidence in the supply chain's reliability. Domestic Program Growth: Management identified domestic defense programs—especially in ground and naval network computing, tactical radars, and electric power and propulsion—as the main sources of growth. International revenue dipped slightly in the quarter, largely due to the timing of deliveries to support Ukraine. Infrared Sensing Headwinds: A supply disruption from a sole-source optics supplier, related to rare earth mineral (germanium) sourcing, resulted in higher input costs and pressured profit margins in the Advanced Sensing and Computing (ASC) segment. Management responded by adjusting contract pricing and adding economic price adjustment clauses to mitigate future volatility. Shipbuilding Expansion: DRS is accelerating the completion of its Charleston facility and expanding its role in U.S. Navy shipbuilding, including investments to become a second source for steam turbine generators. Management highlighted ongoing discussions with the Navy and new opportunities for electric power and propulsion technologies in both manned and unmanned naval platforms. Technology Advancements: The quarter saw the introduction of an AI processor for real-time threat detection and mission computing on combat vehicles, as well as successful demonstrations of electric propulsion on unmanned surface vessels. Management believes these developments position DRS for future growth in rapidly evolving defense applications. Management's outlook for the remainder of the year centers on sustaining organic growth through a strong backlog and ongoing investments, while navigating input cost pressures and potential defense budget shifts. Backlog Visibility: DRS's sizable backlog and continued healthy bookings are expected to provide stability and predictability for revenue growth, with management targeting book-to-bill ratios above one for the year. Margin Expansion Drivers: The Integrated Mission Systems (IMS) segment, supported by expanding Columbia-class submarine content and operational efficiencies, is expected to drive the majority of margin improvement, while the ASC segment faces continued headwinds from input cost volatility. Risk Mitigation Efforts: Management is proactively addressing potential headwinds from volatile input costs—particularly germanium—by incorporating economic price adjustment clauses into future contracts and diversifying raw material sourcing to reduce supply chain risk. Michael Ciarmoli (Truist Securities): Asked if accelerated material receipts were linked to specific programs. CFO Mike Dippold clarified the acceleration was broad-based and that domestic demand led growth, while international sales saw a temporary decline. Alex Ladd (JPMorgan): Sought clarification on margin expansion for the year. Dippold explained that increased revenue volume would generate operating leverage, especially in the IMS segment, driving sequential margin improvement. Jon Tanwanteng (CJS Securities): Questioned why full-year guidance remained unchanged after a strong first quarter. CEO Bill Lynn responded that improved linearity and operational pacing, rather than conservatism, guided their approach to maintaining current targets. Unidentified Analyst (Bank of America): Asked about exposure to European defense opportunities as countries localize production. Lynn noted substantial near-term opportunities, especially in counter-drone and sensing programs, but acknowledged longer-term competition from local industry. Andre Madrid (BTIG): Queried about M&A priorities and managing germanium price volatility. Lynn confirmed M&A remains a capital allocation priority, while Dippold detailed that new contract clauses and diversified sourcing are being used to address supply risks. In the coming quarters, the StockStory team will be watching (1) whether DRS can maintain its strong backlog growth and healthy book-to-bill ratios, (2) how effectively the company mitigates input cost pressures—especially around germanium—and maintains margin expansion, and (3) progress on capital projects such as the Charleston facility and new technology rollouts. Execution in these areas will provide key evidence of DRS's ability to deliver on its stated strategy amid a dynamic defense environment. Leonardo DRS currently trades at a forward P/E ratio of 37.1×. Should you load up, cash out, or stay put? See for yourself in our free research report. Market indices reached historic highs following Donald Trump's presidential victory in November 2024, but the outlook for 2025 is clouded by new trade policies that could impact business confidence and growth. While this has caused many investors to adopt a "fearful" wait-and-see approach, we're leaning into our best ideas that can grow regardless of the political or macroeconomic climate. Take advantage of Mr. Market by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 176% over the last five years. Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
01-05-2025
- Business
- Yahoo
Leonardo DRS (NASDAQ:DRS) Surprises With Q1 Sales, Stock Soars
Aerospace and defense company Leonardo DRS (NASDAQ:DRS) beat Wall Street's revenue expectations in Q1 CY2025, with sales up 16.1% year on year to $799 million. The company expects the full year's revenue to be around $3.48 billion, close to analysts' estimates. Its non-GAAP profit of $0.20 per share was 21.1% above analysts' consensus estimates. Is now the time to buy Leonardo DRS? Find out in our full research report. Revenue: $799 million vs analyst estimates of $731.8 million (16.1% year-on-year growth, 9.2% beat) Adjusted EPS: $0.20 vs analyst estimates of $0.17 (21.1% beat) Adjusted EBITDA: $82 million vs analyst estimates of $78.09 million (10.3% margin, 5% beat) The company reconfirmed its revenue guidance for the full year of $3.48 billion at the midpoint Management reiterated its full-year Adjusted EPS guidance of $1.05 at the midpoint EBITDA guidance for the full year is $445 million at the midpoint, below analyst estimates of $449.4 million Operating Margin: 7.4%, up from 6.3% in the same quarter last year Free Cash Flow was -$170 million compared to -$275 million in the same quarter last year Backlog: $8.61 billion at quarter end, up 9.8% year on year Market Capitalization: $9.83 billion 'Our first quarter 2025 financial results exceeded our expectations and reflect a solid start to the year. Our differentiated portfolio continues to exhibit strong customer demand, which is also translating into healthy organic revenue growth. Additionally, in the quarter we drove improved profitability and reduced free cash flow usage compared to last year. Amidst a more dynamic operating environment, we remain focused on maintaining sharp execution throughout 2025 to meet our commitments to shareholders and customers,' said Bill Lynn, Chairman and CEO of Leonardo DRS. Developing submarine detection systems for the U.S. Navy, Leonardo DRS (NASDAQ:DRS) is a provider of defense systems, electronics, and military support services. Examining a company's long-term performance can provide clues about its quality. Any business can experience short-term success, but top-performing ones enjoy sustained growth for years. Over the last four years, Leonardo DRS grew its sales at a sluggish 3.8% compounded annual growth rate. This fell short of our benchmark for the industrials sector and is a poor baseline for our analysis. Long-term growth is the most important, but within industrials, a stretched historical view may miss new industry trends or demand cycles. Leonardo DRS's annualized revenue growth of 12.4% over the last two years is above its four-year trend, suggesting its demand recently accelerated. We can dig further into the company's revenue dynamics by analyzing its backlog, or the value of its outstanding orders that have not yet been executed or delivered. Leonardo DRS's backlog reached $8.61 billion in the latest quarter and averaged 54.4% year-on-year growth over the last two years. Because this number is better than its revenue growth, we can see the company accumulated more orders than it could fulfill and deferred revenue to the future. This could imply elevated demand for Leonardo DRS's products and services but raises concerns about capacity constraints. This quarter, Leonardo DRS reported year-on-year revenue growth of 16.1%, and its $799 million of revenue exceeded Wall Street's estimates by 9.2%. Looking ahead, sell-side analysts expect revenue to grow 6.2% over the next 12 months, a deceleration versus the last two years. This projection doesn't excite us and indicates its products and services will face some demand challenges. Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we've identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link. Leonardo DRS has managed its cost base well over the last five years. It demonstrated solid profitability for an industrials business, producing an average operating margin of 10.5%. Analyzing the trend in its profitability, Leonardo DRS's operating margin rose by 2.1 percentage points over the last five years, as its sales growth gave it operating leverage. In Q1, Leonardo DRS generated an operating profit margin of 7.4%, up 1.1 percentage points year on year. This increase was a welcome development and shows it was more efficient. We track the change in earnings per share (EPS) for the same reason as long-term revenue growth. Compared to revenue, however, EPS highlights whether a company's growth is profitable. Leonardo DRS's EPS grew at an astounding 18% compounded annual growth rate over the last two years, higher than its 12.4% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded. We can take a deeper look into Leonardo DRS's earnings quality to better understand the drivers of its performance. Leonardo DRS's operating margin has expanded by 3 percentage points over the last two years. This was the most relevant factor (aside from the revenue impact) behind its higher earnings; taxes and interest expenses can also affect EPS but don't tell us as much about a company's fundamentals. In Q1, Leonardo DRS reported EPS at $0.20, up from $0.14 in the same quarter last year. This print easily cleared analysts' estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Leonardo DRS's full-year EPS of $0.99 to grow 9.9%. We were impressed by how significantly Leonardo DRS blew past analysts' revenue expectations this quarter. We were also glad its EPS outperformed Wall Street's estimates. On the other hand, its full-year EBITDA guidance slightly missed. Overall, we think this was still a solid quarter with some key areas of upside. The stock traded up 6.3% to $39.29 immediately after reporting. Leonardo DRS put up rock-solid earnings, but one quarter doesn't necessarily make the stock a buy. Let's see if this is a good investment. What happened in the latest quarter matters, but not as much as longer-term business quality and valuation, when deciding whether to invest in this stock. We cover that in our actionable full research report which you can read here, it's free.
Yahoo
30-03-2025
- Business
- Yahoo
Leonardo DRS (DRS) Introduces AI Combat Processor for Real-Time Threat Detection
We recently published a list of . In this article, we are going to take a look at where Leonardo DRS, Inc. (NASDAQ:DRS) stands against other top AI news updates investors should not miss. The global AI industry is growing at a rapid pace but a looming deadline could stall development across the world. The AI diffusion rule, unveiled by Former US President Joe Biden during his last week in Office, restricts the number of AI processors that can be exported to most nations. The rule will be effective on May 15th. The goal is to ensure that AI development stays concentrated in the US and its close allies. American policymakers want AI data centers and infrastructure built elsewhere to comply with US security standards. If the US government implements the controversial framework, industry experts believe it could disrupt global infrastructure development plans and pose challenges for leading technology companies expanding in foreign markets. When asked about export controls last week, Nvidia CEO Jensen Huang said that 'we should continue to interact with the government,' so that 'whatever policy they believe is best, is informed.' Amid fears of the US taking control of global AI development, senior foreign officials and top tech companies urge the Trump Administration to reassess the semiconductor strategy. They are trying to persuade Trump's team to ease some regulations before the compliance deadline. 'Left unchanged, the Biden rule will give China a strategic advantage in spreading over time its own AI technology, echoing its rapid ascent in 5G telecommunications a decade ago,' said Microsoft president Brad Smith last month. We selected AI stocks by reviewing news articles, stock analysis, and press releases. We listed the stocks in ascending order of their hedge fund sentiment taken from Insider Monkey's Q4 2024 database of over 1000 hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter's strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (). A dynamic group of air force personnel surrounded by the latest defense products in action. Leonardo DRS, Inc. (NASDAQ:DRS) offers advanced defense technologies to US national security clients and allies globally. The company designs, develops, and manufactures sensing, network computing, electric power and propulsion, among other mission-critical technologies for autonomous, interconnected, and multi-domain capabilities to defend against evolving threats. On March 25th, Leonardo DRS, Inc. (NASDAQ:DRS) introduced its high-performance Artificial Intelligence Processor (AIP) computing system, designed for rugged environments. The system swiftly delivers real-time threat detection, situational awareness, and advanced mission insights to military vehicles. The processor analyzes vast repositories of battlefield data to offer actionable intelligence to soldiers across the US Army's ground vehicle fleet, reducing the cognitive burden on crews and commanders. 'With AIP, we are redefining how A.I. is deployed in combat operations. This is not just about processing power—it's about delivering decisive advantage in real-time, ensuring soldiers and commanders are able to make the right decisions when it matters most.' Overall, DRS ranks 4th on our list of top AI news updates investors should not miss. While we acknowledge the potential of DRS as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than DRS but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
Mid East Info
28-02-2025
- Business
- Mid East Info
EDGE and Leonardo DRS Partner to Reinforce UAE Defence and Industrial Capabilities - Middle East Business News and Information
Under the MoU, the two will collaborate in the procurement and systems integration of cutting-edge technologies. Abu Dhabi, UAE:February, 2025 – EDGE entity TRUST, a leading provider of advanced equipment, technologies, and services for national security and defence forces, today announced that it is partnering with Leonardo DRS, a leading provider of advanced defence solutions, to fortify the UAE's defence capabilities. The partners will work together on the development, production, and long-term support for defence solutions tailored to the UAE Armed Forces. The Memorandum of Understanding (MoU) was signed by Dr. Jasem Al Zaabi, Vice President of Business Development – EDGE, and Joe Rahbany, Vice President of Business Development in Middle East, Leonardo DRS; Dr. Abdulmunem Alshehhi, Chief Operations Officer – TRUST; Bill Guyan, SVP of Business Development and President of International Business, Leonardo DRS; Dennis Crumley – SVP and General Manager, Leonardo DRS Land Electronics; and Cameron Dadgar – Business Development Executive, Air Combat at Leonardo DRS, at a ceremony held during the International Defence Exhibition and Conference (IDEX) 2025, running at the Abu Dhabi National Exhibition Centre from 17 to 21 February. Under the terms of the MoU, the two entities are mandated to collaborate in the procurement and systems integration of cutting-edge technologies with a focus on situational awareness systems for vehicle integration. The collaboration has been designed to support the growing operational requirements of the UAE Armed Forces and to ensure the self-sufficiency of the national defence sector through establishing advanced and reliable defence systems. This initiative aligns with the country's vision of enhancing local defence capabilities and fostering partnerships that bring advanced technologies to the region. TRUST International Group and Leonardo DRS are committed to supporting the UAE's defence sector by encouraging innovation and developing localised solutions to meet the rapidly changing defence and national security landscape. Speaking on the synergy, Dr. Jasem Al Zaabi said: 'This partnership represents a significant step in our commitment to providing the UAE Armed Forces with state-of-the-art defence systems. Partnering with Leonardo DRS, further strengthens our confidence in our ability to deliver innovative solutions that address the evolving needs of the UAE Armed Forces.' 'Leonardo DRS is proud to partner with TRUST International Group to support the UAE's defence modernisation efforts,' said Joe Rahbany. 'Our shared expertise and commitment to excellence will ensure that we deliver world-class solutions to the UAE Armed Forces, strengthening their operational readiness and technological edge.' About EDGE: Launched in November 2019, the UAE's EDGE is one of the world's leading advanced technology groups, established to develop agile, bold and disruptive solutions for defence and beyond, and to be a catalyst for change and transformation. It is dedicated to bringing breakthrough innovations, products, and services to market with greater speed and efficiency, to position the UAE as a leading global hub for future industries, and to creating clear paths within the sector for the next generation of highly-skilled talent to thrive. With a focus on the adoption of 4IR technologies, EDGE is driving the development of sovereign capabilities for global export and for the preservation of national security, working with front-line operators, international partners, and adopting advanced technologies such as autonomous capabilities, cyber-physical systems, advanced propulsion systems, robotics and smart materials. EDGE converges R&D, emerging technologies, digital transformation, and commercial market innovations with military capabilities to develop disruptive solutions tailored to the specific requirements of its customers. Headquartered in Abu Dhabi, capital of the UAE, EDGE consolidates more than 35 entities into six core clusters: Platforms & Systems, Missiles & Weapons, Space & Cyber Technologies, Trading & Mission Support, Technology & Innovation, and Homeland Security. About Leonardo DRS: Headquartered in Arlington, VA, Leonardo DRS, Inc. is an innovative and agile provider of advanced defense technology to U.S. national security customers and allies around the world. We specialize in the design, development and manufacture of advanced sensing, network computing, force protection, and electric power and propulsion, and other leading mission-critical technologies. Our innovative people are leading the way in developing disruptive technologies for autonomous, dynamic, interconnected, and multi-domain capabilities to defend against new and emerging threats.
