Latest news with #ScienceApplicationsInternationalCorporation
Yahoo
3 days ago
- Business
- Yahoo
Science Applications Stock Plunges 13% as Q1 Earnings Miss Estimates
Science Applications International SAIC delivered its first-quarter fiscal 2026 results, where the company reported non-GAAP earnings of $1.92 per share, missing the Zacks Consensus Estimate of $2.14 by 10.28%. Furthermore, the bottom line remained flat year over year, as a lower share count offset the impact of a higher tax rate and lower adjusted EBITDA during the Applications' earnings beat the Zacks Consensus Estimate in three of the trailing four quarters and missed once, with an average surprise of 12.18%.Science Applications' fiscal first-quarter revenues rose 2% year over year to $1.877 billion, which marginally surpassed the Zacks Consensus Estimate of $1.864 billion by 0.71%. The top-line growth was primarily driven by ramp-up in volume on new and existing contracts, partially offset by contract shares lost 13% on Monday after a weaker-than-expected bottom-line performance in the fiscal first quarter. The company missed earnings estimates and reported flat year-over-year profits, despite modest revenue growth. Year to date, SAIC stock is down 9.8%, underperforming the Computers – IT Services industry's 7.2% decline, as the latest results appear to have weighed on investor sentiment. Still, management reaffirmed its full-year outlook, signalling confidence in the company's long-term trajectory. Science Applications International Corporation price-consensus-eps-surprise-chart | Science Applications International Corporation Quote Segment-wise, revenues from Defence and Intelligence, which accounted for 76.3% of revenues, amounted to $1.43 billion and decreased 0.2% year over year. Civilian revenues, which constitute 23.7% of revenues, totaled $444 million and rose 8% year over bookings for the quarter were approximately $2.4 billion, which reflected a book-to-bill ratio of 1.3. The company's trailing 12-month book-to-bill ratio was 0.8 at the end of the fiscal first quarter. SAIC's estimated backlog at the end of the quarter was approximately $22.3 billion. Of the total backlog amount, approximately $3.3 billion was general and administrative (SG&A) expenses decreased 4.7% to $89 million. SG&A expenses, as a percentage of revenues, increased to 4.7% from 4.6% in the year-ago operating income decreased year over year to $158 million from the year-ago quarter's operating income of $165 million. The non-GAAP operating margin contracted 50 basis points (bps) year over year to 8.4%. Adjusted EBITDA declined 5.42% to $157 million. Adjusted EBITDA margin for the quarter was 8.4% compared with 9% for the prior-year quarter. Margin performance was impacted by the typical seasonality of investments, including healthy submit volumes and higher costs on a fixed price program in the space business. Science Applications ended the fiscal first quarter with cash and cash equivalents of $47 million, down from the previous quarter's $56 of May 2, 2025, Science Applications' long-term debt (net of the current portion) was $1.876 billion compared with $1.907 billion as of Jan. 31, company generated operating and used free cash flows of $100 million and $44 million, respectively, in the fiscal first the fiscal first quarter, Science Applications repurchased shares worth $125 million and paid $19 million in dividends. Science Applications reaffirms its fiscal 2026 revenues in the range of $7.60-$7.75 billion and adjusted earnings in the $9.10-$9.30 band. The Zacks Consensus Estimate for fiscal 2026 revenues and non-GAAP earnings is pegged at $7.67 billion and $9.19 per share, respectively. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)The company projects its adjusted EBITDA in the band of $715-$735 million and the adjusted EBITDA margin to be approximately 9.4-9.6%. SAIC expects its free cash flow to be in the band of $510-$530 million. Currently, SAIC carries a Zacks Rank #3 (Hold).Paylocity Holding PCTY, StoneCo STNE and Trivago TRVG are some better-ranked stocks that investors can consider in the broader Zacks Computer & Technology STNE and TRVG sport a Zacks Rank #1 (Strong Buy) each at present. You can see the complete list of today's Zacks #1 Rank stocks shares have declined 4.5% year to date. The Zacks Consensus Estimate for PCTY's full-year 2025 earnings is pegged at $7.01 per share, up by 5.4% over the past 30 days, indicating an increase of 6.7% from the year-ago quarter's reported shares have surged 77.4% year to date. The Zacks Consensus Estimate for STNE's full-year 2025 earnings is pegged at $1.43 per share, up by 3.62% over the past 30 days, indicating an increase of 5.93% from the year-ago quarter's reported shares have surged 95% year to date. The Zacks Consensus Estimate for TRVG's full-year 2025 earnings per share is pegged at 10 cents, unchanged over the past 30 days, indicating a rise of 11.11% from the year-ago quarter's reported figure. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Science Applications International Corporation (SAIC) : Free Stock Analysis Report Paylocity Holding Corporation (PCTY) : Free Stock Analysis Report Trivago N.V. ADS (TRVG) : Free Stock Analysis Report StoneCo Ltd. (STNE) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
3 days ago
- Business
- Yahoo
SAIC Q1 Earnings Call: Revenue Miss and Margin Pressures Shape 2025 Outlook
Government IT services provider Science Applications International Corporation (NASDAQ:SAIC) missed Wall Street's revenue expectations in Q1 CY2025 as sales only rose 1.6% year on year to $1.88 billion. Its non-GAAP EPS of $1.92 per share was 9.3% below analysts' consensus estimates. Is now the time to buy SAIC? Find out in our full research report (it's free). Revenue: $1.88 billion (1.6% year-on-year growth) Adjusted EPS: $1.92 vs analyst expectations of $2.12 (9.3% miss) Adjusted Operating Income: $158 million vs analyst estimates of $138.4 million (8.4% margin, 14.2% beat) Management reiterated its full-year Adjusted EPS guidance of $9.20 at the midpoint EBITDA guidance for the full year is $725 million at the midpoint, below analyst estimates of $729.2 million Operating Margin: 6.4%, in line with the same quarter last year Backlog: $22.34 billion at quarter end Market Capitalization: $5.45 billion Science Applications International Corporation's (SAIC) first quarter performance was shaped by persistent procurement delays and customer personnel turnover, which management said contributed to the slower pace of contract awards. CEO Toni Townes-Whitley highlighted that while some areas within the Department of Defense (DoD) received more robust budget requests, significant agency staff changes have affected procurement timelines. The company's decision to move away from lower-margin programs, like CloudOne, also weighed on recent results. Townes-Whitley noted, 'We have been amping up our submissions and being very selective in terms of being on strategy with the bids that we've been making,' indicating a continued focus on higher-value, mission-critical IT and integration work. Looking forward, SAIC's guidance is anchored on ramping up new business and achieving higher on-contract growth, despite ongoing headwinds in budget negotiations and potential delays in contract awards. CFO Prabu Natarajan explained that full-year margin improvement relies on a transition from development-heavy to sustainment phases in certain fixed price programs, as well as continued discipline in cost management. Management reiterated its commitment to achieving margin targets, with Townes-Whitley stating, 'We remain focused on executing and delivering on our full year margin guidance…our flexible cost structure permits us to calibrate our spend in line with the macro environment.' However, the company acknowledged that achieving booking targets may be impacted if procurement delays persist. Management attributed the quarter's performance to slower contract awards, portfolio shifts toward higher-value IT work, and cost overruns on select programs. Several civilian agency contracts and a new space integration win provided areas of relative strength. Procurement delays impact awards: SAIC faced continued delays in federal contract awards due to customer turnover and new agency processes, particularly in acquisition functions. This led to a slower realization of new business, with management emphasizing that award timing rather than program performance drove the softness. Portfolio shift to mission IT: The company continued its pivot away from lower-margin, legacy programs—such as the CloudOne contract, which SAIC intentionally did not rebid—toward higher-margin mission and enterprise IT. This transition is designed to align with evolving government priorities and to position SAIC for more sustainable, profitable growth. Fixed price space program overruns: A unique fixed price development program in the space segment incurred higher costs during its technical development phase. Management stated that the transition into the sustainment phase and recent option period extensions should relieve some cost pressures in future quarters. Civilian business momentum: SAIC's civilian segment showed growth and margin improvement, benefiting from its focus on key agencies like the Department of Homeland Security, State, Transportation, and Treasury, where funding and IT modernization remained supportive. Bookings and backlog visibility: While net bookings and backlog remained solid, management cautioned that achieving their targeted book-to-bill ratio may be delayed by up to two quarters if procurement headwinds persist. Recent post-quarter wins, including a major State Department extension and Air Force contract, bolstered confidence in near-term visibility. Management expects future performance to rest on the pace of new business ramp-up, margin recovery in challenged programs, and the company's ability to adjust to shifting federal priorities. On-contract growth and booking targets: The company is relying on continued growth within existing contracts ('on-contract growth') if new business awards are further delayed. Sustained mid-single-digit on-contract growth is seen as necessary to support its revenue guidance if external headwinds persist. Margin normalization in key programs: Margin improvement is expected as SAIC transitions fixed price programs in the space segment from development to sustainment phases, and as civilian business margins trend higher. Management pointed to enhanced cost controls and standardized delivery frameworks as tools to mitigate margin risk. Federal budget and procurement environment: The outlook depends on stable or moderately growing federal budgets, especially for defense and civilian agencies. Management acknowledged that further disruptions in government funding or policy priorities could impact the timing and mix of awarded contracts, introducing risk to the growth trajectory. In upcoming quarters, the StockStory team will watch (1) whether SAIC can accelerate new business awards and reach its targeted book-to-bill ratio, (2) the pace of margin recovery in fixed price and space programs as they enter sustainment phases, and (3) continued expansion and profitability in the civilian segment, especially as federal funding priorities evolve. Execution on disciplined contract transitions and cost control will also be closely monitored. SAIC currently trades at a forward P/E ratio of 12×. Should you double down or take your chips? Find out in our full research report (it's free). Donald Trump's victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs. While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 6 Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025). 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 Kadant (+351% five-year return). Find your next big winner with StockStory today.
Yahoo
4 days ago
- Business
- Yahoo
Why SAIC (SAIC) Shares Are Falling Today
Shares of government IT services provider Science Applications International Corporation (NASDAQ:SAIC) fell 13% in the morning session after the company announced weak first quarter 2025 (fiscal 2026) results which missed analysts' EPS estimates. The underwhelming result was due to sluggish revenue growth, which rose just 2% year on year, driven largely by volume increases in existing and new contracts, but weighed down by the completion of older contracts. Looking ahead, the company reaffirmed its full-year guidance for adjusted EPS and EBITDA, but both fell short of Wall Street estimates. Management pointed to strong bookings with a 1.3 book-to-bill ratio and high-profile wins like the U.S. Army contract, but those longer-term prospects likely didn't sway investors focused on profitability. Overall, it was a weak quarter. The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy SAIC? Access our full analysis report here, it's free. SAIC's shares are not very volatile and have only had 6 moves greater than 5% over the last year. Moves this big are rare for SAIC and indicate this news significantly impacted the market's perception of the business. The biggest move we wrote about over the last year was 3 months ago when the stock gained 11.7% on the news that the company reported impressive fourth quarter 2024 (fiscal 2025) results, which blew past analysts' sales and earnings estimates. Organic sales grew 5.8% compared to the previous year by increased contract volume, which helped push adjusted EBITDA up 39% compared to the prior year. Margins expanded significantly, with operating income as a percentage of revenue rising to 7.5% from 4.5% in the prior year, thanks to improved contract profitability and lower expenses. This was a key driver behind the earnings beat. Looking ahead, full-year guidance for EBITDA and EPS were both ahead, suggesting the improved growth momentum is expected to continue. Overall, we think this was a strong quarter with top and bottom-line improvements. SAIC is down 9.7% since the beginning of the year, and at $101.31 per share, it is trading 34.3% below its 52-week high of $154.10 from November 2024. Investors who bought $1,000 worth of SAIC's shares 5 years ago would now be looking at an investment worth $1,115. Today's young investors likely haven't read the timeless lessons in Gorilla Game: Picking Winners In High Technology because it was written more than 20 years ago when Microsoft and Apple were first establishing their supremacy. But if we apply the same principles, then enterprise software stocks leveraging their own generative AI capabilities may well be the Gorillas of the future. So, in that spirit, we are excited to present our Special Free Report on a profitable, fast-growing enterprise software stock that is already riding the automation wave and looking to catch the generative AI next.
Yahoo
4 days ago
- Business
- Yahoo
SAIC (NASDAQ:SAIC) Exceeds Q1 Expectations But Stock Drops
Government IT services provider Science Applications International Corporation (NASDAQ:SAIC) reported Q1 CY2025 results exceeding the market's revenue expectations , with sales up 1.6% year on year to $1.88 billion. The company expects the full year's revenue to be around $7.68 billion, close to analysts' estimates. Its non-GAAP profit of $1.92 per share was 9.3% below analysts' consensus estimates. Is now the time to buy SAIC? Find out in our full research report. Revenue: $1.88 billion vs analyst estimates of $1.87 billion (1.6% year-on-year growth, 0.6% beat) Adjusted EPS: $1.92 vs analyst expectations of $2.12 (9.3% miss) Adjusted EBITDA: $157 million vs analyst estimates of $172.2 million (8.4% margin, 8.8% miss) The company reconfirmed its revenue guidance for the full year of $7.68 billion at the midpoint Management reiterated its full-year Adjusted EPS guidance of $9.20 at the midpoint EBITDA guidance for the full year is $725 million at the midpoint, below analyst estimates of $729.2 million Operating Margin: 6.4%, in line with the same quarter last year Free Cash Flow was -$44 million, down from $21 million in the same quarter last year Backlog: $22.34 billion at quarter end Market Capitalization: $5.45 billion With over five decades of experience supporting national security missions, Science Applications International Corporation (NASDAQ:SAIC) provides technical, engineering, and enterprise IT services primarily to U.S. government agencies and military branches. A company's long-term performance is an indicator of its overall quality. Any business can have short-term success, but a top-tier one grows for years. With $7.51 billion in revenue over the past 12 months, SAIC is one of the larger companies in the business services industry and benefits from a well-known brand that influences purchasing decisions. However, its scale is a double-edged sword because it's harder to find incremental growth when you've penetrated most of the market. For SAIC to boost its sales, it likely needs to adjust its prices, launch new offerings, or lean into foreign markets. As you can see below, SAIC's sales grew at a sluggish 2.9% compounded annual growth rate over the last five years. This shows it failed to generate demand in any major way and is a rough starting point for our analysis. We at StockStory place the most emphasis on long-term growth, but within business services, a half-decade historical view may miss recent innovations or disruptive industry trends. SAIC's performance shows it grew in the past but relinquished its gains over the last two years, as its revenue fell by 1.5% annually. This quarter, SAIC reported modest year-on-year revenue growth of 1.6% but beat Wall Street's estimates by 0.6%. Looking ahead, sell-side analysts expect revenue to grow 3.1% over the next 12 months. While this projection indicates its newer products and services will catalyze better top-line performance, it is still below the sector average. Software is eating the world and there is virtually no industry left that has been untouched by it. That drives increasing demand for tools helping software developers do their jobs, whether it be monitoring critical cloud infrastructure, integrating audio and video functionality, or ensuring smooth content streaming. Click here to access a free report on our 3 favorite stocks to play this generational megatrend. Operating margin is a key measure of profitability. Think of it as net income - the bottom line - excluding the impact of taxes and interest on debt, which are less connected to business fundamentals. SAIC was profitable over the last five years but held back by its large cost base. Its average operating margin of 7.3% was weak for a business services business. On the plus side, SAIC's operating margin rose by 1.2 percentage points over the last five years, as its sales growth gave it operating leverage. In Q1, SAIC generated an operating margin profit margin of 6.4%, in line with the same quarter last year. This indicates the company's overall cost structure has been relatively stable. We track the long-term 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. SAIC's EPS grew at a solid 9.9% compounded annual growth rate over the last five years, higher than its 2.9% annualized revenue growth. This tells us the company became more profitable on a per-share basis as it expanded. Diving into SAIC's quality of earnings can give us a better understanding of its performance. As we mentioned earlier, SAIC's operating margin was flat this quarter but expanded by 1.2 percentage points over the last five years. On top of that, its share count shrank by 18.3%. These are positive signs for shareholders because improving profitability and share buybacks turbocharge EPS growth relative to revenue growth. In Q1, SAIC reported EPS at $1.92, in line with the same quarter last year. This print missed analysts' estimates, but we care more about long-term EPS growth than short-term movements. Over the next 12 months, Wall Street expects SAIC's full-year EPS of $9.15 to grow 4.7%. It was good to see SAIC narrowly top analysts' revenue expectations this quarter. On the other hand, its EPS missed and its full-year EPS guidance fell slightly short of Wall Street's estimates. Overall, this was a weaker quarter. The stock traded down 6.3% to $108.26 immediately following the results. SAIC may have had a tough quarter, but does that actually create an opportunity to invest right now? The latest quarter does matter, but not nearly as much as longer-term fundamentals and valuation, when deciding if the stock is a buy. We cover that in our actionable full research report which you can read here, it's free. 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
4 days ago
- Business
- Yahoo
SAIC Announces First Quarter of Fiscal Year 2026 Results
RESTON, Va., June 02, 2025 (GLOBE NEWSWIRE) -- Science Applications International Corporation (NASDAQ: SAIC), a premier Fortune 500 technology integrator driving our nation's digital transformation across the defense, space, civilian, and intelligence markets, today announced results for the first quarter ended May 2, 2025. "Our performance in the first quarter reflects the steady progress we are making against our enterprise growth strategy despite a still dynamic operating environment," said Toni Townes-Whitley, SAIC Chief Executive Officer. "As a premier mission integrator, the rapid evolution of new technologies, a renewed focus on deploying software to drive efficiency, and an elevated global threat environment create significant opportunities for SAIC. I am confident that SAIC is prepared and well aligned with these macro trends to drive value for our customers, employees, and shareholders." First Quarter of Fiscal Year 2026: Summary Operating Results Three Months Ended May 2, 2025 Percent change May 3, 2024 (dollars in millions, except per share amounts) Revenues $ 1,877 2 % $ 1,847 Operating income 121 (8 )% 131 Operating income as a percentage of revenues -70bps 7.1 % Adjusted operating income(1) 158 (4 )% 165 Adjusted operating income as a percentage of revenues -50bps 8.9 % Net income 68 (12 )% 77 EBITDA(1) 156 (7 )% 167 EBITDA as a percentage of revenues -70bps 9.0 % Adjusted EBITDA(1) 157 (5 )% 166 Adjusted EBITDA as a percentage of revenues -60bps 9.0 % Diluted earnings per share $ 1.42 (4 )% $ 1.48 Adjusted diluted earnings per share(1) $ 1.92 — % $ 1.92 Net cash provided by operating activities $ 100 2 % $ 98 Free cash flow(1) $ (44 ) (438 )% $ 13 (1)Non-GAAP measure, see Schedule 6 for information about this measure. First Quarter Summary Results Revenues for the quarter increased $30 million or 2% compared to the same period in the prior year primarily due to ramp up in volume in existing and new contracts, partially offset by contract completions. Operating income as a percentage of revenues decreased from the comparable prior year period primarily due to timing and volume mix in our contract portfolio. Adjusted EBITDA(1) as a percentage of revenues for the quarter decreased to 8.4% from 9.0% for the same period in the prior year primarily due to timing and volume mix in our contract portfolio. Diluted earnings per share for the quarter was $1.42 compared to $1.48 in the prior year quarter. Adjusted diluted earnings per share(1) for both the current and prior year quarter was $1.92. The weighted-average diluted shares outstanding during the quarter decreased to 47.8 million from 52.1 million during the prior year quarter. (1)Non-GAAP measure, see Schedule 6 for information about this measure. Cash Generation and Capital Deployment Cash flows provided by operating activities for the first quarter increased $2 million compared to the prior year quarter, primarily due to higher cash provided by the Master Accounts Receivable Purchase Agreement ("MARPA Facility") and lower incentive-based compensation payments in the current year, partially offset by timing of vendor payments and other changes in working capital. During the quarter, SAIC deployed $152 million of capital, primarily consisting of $125 million of plan share repurchases and $19 million in cash dividends. Quarterly Dividend Declared Subsequent to quarter end, the Company's Board of Directors declared a cash dividend of $0.37 per share of the Company's common stock payable on July 25, 2025 to stockholders of record on July 11, 2025. SAIC intends to continue paying dividends on a quarterly basis, although the declaration of any future dividends will be determined by the Board of Directors each quarter and will depend on earnings, financial condition, capital requirements and other factors. Backlog and Contract Awards Net bookings for the quarter were approximately $2.4 billion, which reflects a book-to-bill ratio of 1.3 and a trailing twelve months book-to-bill ratio of 0.8. SAIC's estimated backlog at the end of the quarter was approximately $22.3 billion. Of the total backlog amount, approximately $3.3 billion was funded. Notable New and Recompete Awards: During the quarter, SAIC was awarded the System Software Lifecycle Engineering contract, a five-year (one year base, plus four, one-year option periods) $1.8 billion contract to continue mission engineering, integration, software development, and other life cycle support to CCDC-AvMC. Under the five-year award, SAIC will continue to develop and integrate advanced technologies throughout the software life cycle, including software development and maintenance. During the quarter, SAIC was awarded a $327 million contract to continue delivering essential IT services for the Pension Benefit Guaranty Corporation. Under this eight-year (approximately 1-year base, plus seven, one-year option periods) contract renewal, SAIC will provide seamless operation across various IT functions including service desk, desktop support, user services, platform support, network and database support, and cloud migration. During the quarter, SAIC was awarded approximately $300 million of contract awards by space and intelligence organizations. These awards represent a combination of new business and recompetes, including a four-year, $140 million task order to provide enterprise cloud services. Notable Awards Subsequent to Period End (not included in current quarter bookings): Subsequent to the end of the quarter, SAIC was awarded a two-year (1 year base plus four, three-month option periods) $547 million contract extension on the Vanguard program to continue providing comprehensive IT services and support for the Department of State. Fiscal Year 2026 Guidance Management reaffirms fiscal year 2026 guidance which represents the Company's views as of June 2, 2025. Fiscal Year 2026 Guidance Revenue $7.60B - $7.75B Adjusted EBITDA(1) $715M - $735M Adjusted EBITDA Margin %(1) 9.4% - 9.6% Adjusted Diluted EPS(1) $9.10 - $9.30 Free Cash Flow(1) $510M - $530M (1)Non-GAAP measure, see Schedule 6 for information about this measure. Webcast Information SAIC management will discuss operations and financial results in an earnings conference call beginning at 10:00 a.m. Eastern time on June 2, 2025. The conference call will be webcast simultaneously to the public through a link on the Investor Relations section of the SAIC website ( We will be providing webcast access only – 'dial-in' access is no longer available. Additionally, a supplemental presentation will be available to the public through links to the Investor Relations section of the SAIC website. After the call concludes, an on-demand audio replay of the webcast can be accessed on the Investor Relations website. About SAIC SAIC® is a premier Fortune 500 mission integrator focused on advancing the power of technology and innovation to serve and protect our world. Our robust portfolio of offerings across the defense, space, civilian and intelligence markets includes secure high-end solutions in mission IT, enterprise IT, engineering services and professional services. We integrate emerging technology, rapidly and securely, into mission critical operations that modernize and enable critical national imperatives. We are approximately 24,000 strong; driven by mission, united by purpose, and inspired by opportunities. Headquartered in Reston, Virginia, SAIC has annual revenues of approximately $7.5 billion. For more information, visit For ongoing news, please visit our newsroom. Contacts Investor Relations: Joe DeNardi, Kara Ross, Company does not provide a reconciliation of forward-looking adjusted diluted EPS to GAAP diluted EPS, adjusted EBITDA margin to GAAP net income or free cash flow to GAAP net cash flows from operating activities due to the inherent difficulty in forecasting and quantifying certain amounts that are necessary for such reconciliation. Because certain deductions for non-GAAP exclusions used to calculate net income and cash flows from operating activities may vary significantly based on actual events, the Company is not able to forecast GAAP diluted EPS, GAAP net income or GAAP net cash flows from operating activities with reasonable certainty. The variability of the above charges may have an unpredictable and potentially significant impact on our future GAAP financial statements in this release contain or are based on 'forward-looking' information within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by words such as 'expects,' 'intends,' 'plans,' 'anticipates,' 'believes,' 'estimates,' 'guidance,' and similar words or phrases. Forward-looking statements in this release may include, among others, estimates of future revenues, operating income, earnings, earnings per share, charges, total contract value, backlog, outstanding shares and cash flows, as well as statements about future dividends, share repurchases and other capital deployment plans. Such statements are not guarantees of future performance and involve risk, uncertainties and assumptions, and actual results may differ materially from the guidance and other forward-looking statements made in this release as a result of various factors. Risks, uncertainties and assumptions that could cause or contribute to these material differences include those discussed in the 'Risk Factors,' 'Management's Discussion and Analysis of Financial Condition and Results of Operations' and 'Legal Proceedings' sections of our Annual Report on Form 10-K, as updated in any subsequent Quarterly Reports on Form 10-Q and other filings with the SEC, which may be viewed or obtained through the Investor Relations section of our website at or on the SEC's website at Due to such risks, uncertainties and assumptions you are cautioned not to place undue reliance on such forward-looking statements, which speak only as of the date hereof. SAIC expressly disclaims any duty to update any forward-looking statement provided in this release to reflect subsequent events, actual results or changes in SAIC's expectations. SAIC also disclaims any duty to comment upon or correct information that may be contained in reports published by investment analysts or others. Schedule 1: SCIENCE APPLICATIONS INTERNATIONAL CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited) Three Months Ended May 2, 2025 May 3, 2024 (in millions, except per share amounts) Revenues $ 1,877 $ 1,847 Cost of revenues 1,668 1,634 Selling, general and administrative expenses 89 85 Other operating (income) expense (1 ) (3 ) Operating income 121 131 Interest expense, net 30 34 Other (income) expense, net 5 2 Income before income taxes 86 95 Provision for income taxes (18 ) (18 ) Net income $ 68 $ 77 Weighted-average number of shares outstanding: Basic 47.6 51.6 Diluted 47.8 52.1 Earnings per share: Basic $ 1.43 $ 1.49 Diluted $ 1.42 $ 1.48 Schedule 2: SCIENCE APPLICATIONS INTERNATIONAL CORPORATIONCONDENSED CONSOLIDATED BALANCE SHEETS(Unaudited) May 2, 2025 January 31,2025 (in millions) ASSETS Current assets: Cash and cash equivalents $ 47 $ 56 Receivables, net 1,009 1,000 Prepaid expenses and other current assets 92 98 Total current assets 1,148 1,154 Goodwill 2,851 2,851 Intangible assets, net 750 779 Property, plant, and equipment, net 102 104 Operating lease right of use assets 161 164 Other assets 199 194 Total assets $ 5,211 $ 5,246 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 668 $ 631 Accrued payroll and employee benefits 288 339 Other accrued liabilities 113 113 Debt, current portion 405 313 Total current liabilities 1,474 1,396 Debt, net of current portion 1,876 1,907 Operating lease liabilities 160 173 Deferred income taxes 22 24 Other long-term liabilities 174 169 Equity: Total stockholders' equity 1,505 1,577 Total liabilities and stockholders' equity $ 5,211 $ 5,246 Schedule 3: SCIENCE APPLICATIONS INTERNATIONAL CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(Unaudited) Three Months Ended May 2, 2025 May 3, 2024 (in millions) Cash flows from operating activities: Net income $ 68 $ 77 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 36 35 Stock-based compensation expense 15 13 Other — (1 ) Increase (decrease) resulting from changes in operating assets and liabilities: Receivables (9 ) (20 ) Prepaid expenses and other current assets 6 15 Accounts payable and accrued liabilities 33 60 Accrued payroll and employee benefits (51 ) (83 ) Operating lease assets and liabilities, net (2 ) (3 ) Other assets and other long-term liabilities, net 4 5 Net cash provided by operating activities 100 98 Cash flows from investing activities: Expenditures for property, plant, and equipment (8 ) (6 ) Purchases of marketable securities (4 ) (4 ) Sales of marketable securities 3 4 Contributions to investments (6 ) (1 ) Net cash used in investing activities (15 ) (7 ) Cash flows from financing activities: Principal payments on borrowings (689 ) (310 ) Proceeds from borrowings 750 293 Stock repurchased and retired or withheld for taxes on equity awards (142 ) (103 ) Dividend payments to stockholders (19 ) (20 ) Issuances of stock 6 4 Net cash used in financing activities (94 ) (136 ) Net decrease in cash, cash equivalents and restricted cash (9 ) (45 ) Cash, cash equivalents and restricted cash at beginning of period 64 103 Cash, cash equivalents and restricted cash at end of period $ 55 $ 58 Schedule 4: SCIENCE APPLICATIONS INTERNATIONAL CORPORATION SEGMENT OPERATING RESULTS (Unaudited) Three Months Ended May 2, 2025 May 3, 2024 (dollars in millions) Revenues Defense and Intelligence $ 1,433 $ 1,436 Civilian 444 411 Total revenues $ 1,877 $ 1,847 Operating income (loss) Defense and Intelligence $ 98 $ 107 Civilian 40 34 Corporate (17 ) (10 ) Total operating income $ 121 $ 131 Operating margin Defense and Intelligence 6.8 % 7.5 % Civilian 9.0 % 8.3 % Total operating margin 6.4 % 7.1 % Adjusted operating income (loss)(1) Defense and Intelligence $ 115 $ 124 Civilian 52 46 Corporate (9 ) (5 ) Total adjusted operating income(1) $ 158 $ 165 Adjusted operating margin(1) Defense and Intelligence 8.0 % 8.6 % Civilian 11.7 % 11.2 % Total adjusted operating margin(1) 8.4 % 8.9 % First Quarter Defense and Intelligence Results Revenues for the quarter decreased $3 million or 0.2% compared to the same period in the prior year primarily due to contract completions, partially offset by ramp up in volume on existing and new contracts. Operating and adjusted operating income(1) as a percentage of revenues decreased from the comparable prior year period primarily due to timing and volume mix in our contract portfolio. First Quarter Civilian Results Revenues for the quarter increased $33 million or 8% compared to the same period in the prior year primarily due to ramp up in volume on existing and new contracts. Operating and adjusted operating income(1) as a percentage of revenues increased from the comparable prior year period due to ramp up in volume on existing and new contracts. First Quarter Corporate Results Operating and adjusted operating loss(1) for the quarter increased $7 million and $4 million, respectively, from the comparable prior year period primarily due to higher selling, general and administrative expenses. (1)Non-GAAP measure, see Schedule 6 for information about this measure. Schedule 5: SCIENCE APPLICATIONS INTERNATIONAL CORPORATION BACKLOG (Unaudited) The estimated value of our total backlog as of the dates presented was: May 2, 2025 January 31, 2025 Defense and Intelligence Civilian Total SAIC Defense and Intelligence Civilian Total SAIC (in millions) Funded backlog $ 2,524 $ 741 $ 3,265 $ 2,599 $ 845 $ 3,444 Negotiated unfunded backlog 15,857 3,221 19,078 15,341 3,072 18,413 Total backlog $ 18,381 $ 3,962 $ 22,343 $ 17,940 $ 3,917 $ 21,857 Backlog represents the estimated amount of future revenues to be recognized under negotiated contracts and task orders as work is performed and excludes contract awards which have been protested by competitors until the protest is resolved in our favor. SAIC segregates backlog into two categories, funded backlog and negotiated unfunded backlog. Funded backlog for contracts with government agencies primarily represents contracts for which funding is appropriated less revenues previously recognized on these contracts, and does not include the unfunded portion of contracts where funding is incrementally appropriated or authorized by the U.S. government and other customers even though the contract may call for performance over a number of years. Funded backlog for contracts with non-government agencies represents the estimated value of contracts which may cover multiple future years under which SAIC is obligated to perform, less revenues previously recognized on these contracts. Negotiated unfunded backlog represents the estimated future revenues to be earned from negotiated contracts for which funding has not been appropriated or authorized, and unexercised priced contract options. Negotiated unfunded backlog does not include any estimate of future potential task orders expected to be awarded under indefinite delivery, indefinite quantity (IDIQ), U.S. General Services Administration (GSA) schedules or other master agreement contract vehicles, with the exception of certain IDIQ contracts where task orders are not competitively awarded and separately priced but instead are used as a funding mechanism, and where there is a basis for estimating future revenues and funding on future anticipated task orders. Schedule 6: SCIENCE APPLICATIONS INTERNATIONAL CORPORATION NON-GAAP FINANCIAL MEASURES (Unaudited) This schedule describes the non-GAAP financial measures included in this earnings release. While we believe that these non-GAAP financial measures may be useful in evaluating our financial information, they should be considered as supplemental in nature and not as a substitute for financial information prepared in accordance with GAAP. Reconciliations, definitions, and how we believe these measures are useful to management and investors are provided below. Other companies may define similar measures differently. EBITDA and Adjusted EBITDA Three Months Ended May 2, 2025 May 3, 2024 (dollars in millions) Revenues $ 1,877 $ 1,847 Net income $ 68 $ 77 Interest expense, net and loss on sale of receivables 34 37 Provision for income taxes 18 18 Depreciation and amortization 36 35 EBITDA(1) 156 167 EBITDA as a percentage of revenues 9.0 % Acquisition and integration costs — (2 ) Restructuring and impairment costs 3 2 Recovery of acquisition and integration costs and restructuring and impairment costs (2 ) (1 ) Adjusted EBITDA(1) $ 157 $ 166 Adjusted EBITDA as a percentage of revenues 9.0 % EBITDA is a performance measure that is calculated by taking net income and excluding interest and loss on sale of receivables, provision for income taxes, and depreciation and amortization. Adjusted EBITDA is a performance measure that excludes the impact of non-recurring transactions that we do not consider to be indicative of our ongoing operating performance. Adjusted EBITDA is calculated by taking EBITDA and excluding acquisition and integration costs, impairments, restructuring costs, and any other material non-recurring costs. The acquisition and integration costs relate to the Company's acquisitions. The restructuring and impairment costs represent the reorganization and facilities optimization costs or impairments of long-lived assets. The recovery of acquisition and integration costs and restructuring and impairment costs relate to costs recovered through the Company's indirect rates in accordance with Cost Accounting Standards. We believe that these performance measures provide management and investors with useful information in assessing trends in our ongoing operating performance and may provide greater visibility in understanding the long-term financial performance of the Company. (1)Non-GAAP measure, see above for definition. Schedule 6 (continued): SCIENCE APPLICATIONS INTERNATIONAL CORPORATION NON-GAAP FINANCIAL MEASURES (Unaudited) Adjusted Operating Income Three Months Ended May 2, 2025 (dollars in millions) As Reported Restructuring and impairment costs Recovery of acquisition and integration costs and restructuring and impairment costs Depreciation of property, plant, and equipment Amortization of intangible assets Non-GAAP results(1) Non-GAAP operating margin(1) Defense and Intelligence $ 98 $ 1 $ (1 ) $ — $ 17 $ 115 8.0 % Civilian 40 — — — 12 52 11.7 % Corporate (17 ) 2 (1 ) 7 — (9 ) Total $ 121 $ 3 $ (2 ) $ 7 $ 29 $ 158 8.4 % Three Months Ended May 3, 2024 (dollars in millions) As Reported Acquisition and integration costs Restructuring and impairment costs Recovery of acquisition and integration costs and restructuring and impairment costs Depreciation of property, plant, and equipment Amortization of intangible assets Non-GAAP results(1) Non-GAAP operating margin(1) Defense and Intelligence $ 107 $ — $ — $ — $ — $ 17 $ 124 8.6 % Civilian 34 — — — — 12 46 11.2 % Corporate (10 ) (2 ) 2 (1 ) 6 — (5 ) NM Total $ 131 $ (2 ) $ 2 $ (1 ) $ 6 $ 29 $ 165 8.9 % Adjusted operating income is a performance measure that primarily excludes the impact of non-recurring transactions that we do not consider to be indicative of our ongoing operating performance. Adjusted operating income is calculated by taking operating income and excluding depreciation and amortization, acquisition and integration costs, impairments, restructuring costs, and any other material non-recurring costs. The acquisition and integration costs relate to the Company's acquisitions. The restructuring and impairment costs represent the reorganization and facilities optimization costs and impairments of long-lived assets, along with associated depreciation. The recovery of acquisition and integration costs and restructuring and impairment costs relate to costs recovered through the Company's indirect rates in accordance with Cost Accounting Standards. Depreciation of property, plant, and equipment relates to property, plant, and equipment specifically identifiable for each segment. Adjusted operating income also excludes amortization of intangible assets because we do not have a history of significant acquisition activity, we do not acquire businesses on a predictable cycle, and the amount of an acquisition's purchase price allocated to intangible assets and the related amortization term are unique to each acquisition. We believe that these performance measures provide management and investors with useful information in assessing trends in our ongoing operating performance and may provide greater visibility in understanding the long-term financial performance of the Company. (1)Non-GAAP measure, see above for definition. Schedule 6 (continued): SCIENCE APPLICATIONS INTERNATIONAL CORPORATION NON-GAAP FINANCIAL MEASURES (Unaudited) Adjusted Diluted Earnings Per Share Three Months Ended May 2, 2025 (in millions, except per share amounts) As Reported Restructuring and impairment costs Recovery of acquisition and integration costs and restructuring and impairment costs Amortization of intangible assets Non-GAAP results(1) Income before income taxes $ 86 $ 3 $ (2 ) $ 29 $ 116 Provision for income taxes (18 ) — — (6 ) (24 ) Net income $ 68 $ 3 $ (2 ) $ 23 $ 92 Diluted EPS $ 1.42 $ 0.06 $ (0.04 ) $ 0.48 $ 1.92 Three Months Ended May 3, 2024 (in millions, except per share amounts) As Reported Acquisition and integration costs Restructuring and impairment costs Recovery of acquisition and integration costs and restructuring and impairment costs Amortization of intangible assets Non-GAAP results(1) Income before income taxes $ 95 $ (2 ) $ 2 $ (1 ) $ 29 $ 123 Provision for income taxes (18 ) — — — (5 ) (23 ) Net income $ 77 $ (2 ) $ 2 $ (1 ) $ 24 $ 100 Diluted EPS $ 1.48 $ (0.04 ) $ 0.04 $ (0.02 ) $ 0.46 $ 1.92 Adjusted diluted earnings per share is a performance measure that excludes the impact of non-recurring transactions that we do not consider to be indicative of our ongoing operating performance. The acquisition and integration costs relate to the Company's acquisitions. The restructuring and impairment costs represent the reorganization and facilities optimization costs or impairments of long-lived assets. The recovery of acquisition and integration costs and restructuring and impairment costs relate to costs recovered through the Company's indirect rates in accordance with Cost Accounting Standards. Adjusted diluted earnings per share also excludes amortization of intangible assets because we do not have a history of significant acquisition activity, we do not acquire businesses on a predictable cycle, and the amount of an acquisition's purchase price allocated to intangible assets and the related amortization term are unique to each acquisition. We believe that this performance measure provides management and investors with useful information in assessing trends in our ongoing operating performance and may provide greater visibility in understanding the long-term financial performance of the Company. (1)Non-GAAP measure, see above for definition. Schedule 6 (continued): SCIENCE APPLICATIONS INTERNATIONAL CORPORATION NON-GAAP FINANCIAL MEASURES (Unaudited) Free Cash Flow Three Months Ended May 2, 2025 May 3, 2024 (in millions) Net cash provided by operating activities $ 100 $ 98 Expenditures for property, plant, and equipment (8 ) (6 ) Cash used from (provided by) MARPA Facility (136 ) (79 ) Free cash flow(1) $ (44 ) $ 13 FY26 Guidance (in millions) Net cash provided by operating activities $545 to $565 Expenditures for property, plant, and equipment Approximately $35 Free cash flow(1) $510 to $530 Free cash flow is calculated by taking cash flows provided by operating activities less expenditures for property, plant, and equipment and less cash flows from our Master Accounts Receivable Purchasing Agreement (MARPA Facility) for the sale of certain designated eligible U.S. government receivables. Under the MARPA Facility, the Company can sell eligible receivables up to a maximum amount of $300 million. We believe that free cash flow provides management and investors with useful information in assessing trends in our cash flows and in comparing them to other peer companies, many of whom present similar non-GAAP liquidity measures. This measure should not be considered as a measure of residual cash flow available for discretionary purposes. (1)Non-GAAP measure, see above for 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
