Highlights

  • Fiscal 2026 revenues were $983.6 million, compared with $912.0 million, and the net loss was $29.7 million, or $0.50 per diluted share.
  • Adjusted EBITDA, a non-GAAP measure, was $150.2 million for fiscal 2026, and adjusted earnings per share was $1.06.
  • Backlog was approximately $1.9 billion as of July 3, 2026, of which $996.0 million is expected to be recognized within twelve months.
  • Management expects fiscal 2027 total revenue approaching $1.1 billion and adjusted EBITDA approaching $200 million.

Mercury Systems, Inc. (NASDAQ: MRCY) shares were trading at USD 79.36 on October 27, 2026, down 0.44%, with a relative volume at time of 2.52. The aerospace and defense electronics company authorized a $200.0 million share repurchase program in November 2025, repaid $150.0 million of its revolver in April 2026, filed its Form 10-K for fiscal 2026 on August 18, 2026, and discussed fiscal 2027 expectations on an August 25, 2026 call.

Mercury Systems is incorporated in Massachusetts and has its corporate headquarters in Andover, Massachusetts. It provides signal and data processing for aerospace and defense, selling modules, sub-assemblies, components and integrated solutions to U.S. and European defense prime contractors, the U.S. government and commercial aerospace original equipment manufacturers. Applications include radar processing, electronic warfare and avionics. It closes each 52-week or 53-week fiscal year on the Friday closest to the last day in June, and it had 2,102 employees as of July 3, 2026.

Fiscal 2026 Results

Fiscal 2026 contained 53 weeks, compared with 52 weeks in fiscal 2025. Net revenues were $983,622 thousand, compared with $912,020 thousand. The company said total revenues increased $71.6 million, or 7.9%.

Gross margin was 28.6%, compared with 27.9%. Selling, general and administrative expenses were $175.0 million, compared with $154.4 million, and research and development expenses were $59.7 million. Income from operations was $280 thousand, compared with a loss from operations of $19,627 thousand.

Interest expense was $29,590 thousand, and the loss before income tax provision was $28,889 thousand. The net loss was $29,673 thousand, or $0.50 per diluted share, compared with a net loss of $37,904 thousand, or $0.65 per diluted share. Litigation and settlement expense, net, was $13,451 thousand.

Non-GAAP adjusted EBITDA was $150.2 million, compared with $119.4 million, and adjusted income was $64,170 thousand, or $1.06 per diluted share.

Balance Sheet, Cash Flow and Capital

Cash and cash equivalents were $214,306 thousand at July 3, 2026, compared with $309,099 thousand at June 27, 2025. Long-term debt was $441,500 thousand, compared with $591,500 thousand. Net cash provided by operating activities was $102,388 thousand, and non-GAAP free cash flow was $68,087 thousand, compared with $119,048 thousand.

On November 4, 2025, the company executed Amendment No. 7 to its revolver, extending maturity to November 4, 2030 with a facility size of $850.0 million. On April 30, 2026, it repaid $150.0 million, leaving $441.5 million drawn, and it said it remained in compliance with all applicable financial covenants. On June 1, 2026, it entered into a $100.0 million committed Receivables Purchase Agreement and terminated its prior Receivables Purchase and Servicing Agreement on June 4, 2026.

The board authorized a share repurchase program of up to $200.0 million on November 3, 2025. As of July 3, 2026, $185.0 million was available under the program.

Backlog, Bookings and Customers

Backlog was approximately $1.9 billion as of July 3, 2026, compared with approximately $1.4 billion as of June 27, 2025. The company noted that orders in backlog may be canceled or rescheduled by customers. On the call, management said fourth quarter bookings were approximately $660 million with a book-to-bill of 2.28, and fourth quarter revenues were nearly $290 million. The filing lists dependence on a small number of customers among its risk factors.

Fiscal 2027 Outlook

On the call, management said it expects fiscal 2027 revenue growth approaching double digits, with total revenue approaching $1.1 billion. It expects first quarter revenue to be the lowest of the year and up high single digits year over year. Management expects adjusted EBITDA approaching $200 million, with an adjusted EBITDA margin in the high teens. It said it expects free cash flow conversion approaching 35%, below its 50% target, reflecting planned investments in automation and inventory.