Kratos Defense & Security Solutions (KTOS) FY2025 results: revenue $1.3 billion, up 18.5% on the year
Kratos Defense & Security Solutions, Inc. (KTOS) reported revenue of $1.3 billion for fiscal 2025, the year ended 28 December 2025, up 18.5% on the year before. Net income was $22 million, up 35.0%, and diluted earnings per share $0.13. The figures are the company's own, from the 10-K it filed with the SEC on 23 February 2026.
this yearthe year beforeHover a bar for its figure.
The year in brief
What management said about the year
Guidance figures: 1 raised, 10 new, 4 kept.
- Revenue up 21.9 percent in Q4: Revenue was $345.1 million, up from $283.1 million, with 20.0 percent organic growth. Operating income was $8.2 million and GAAP net income $5.9 million, or $0.03 per diluted share.
- Full-year revenue $1.347 billion: Full-year 2025 revenue was $1.347 billion, up 18.5 percent and 16.6 percent organically. Full-year net income was $22.0 million, diluted EPS $0.13, and adjusted EPS $0.55 against $0.49.
- KGS revenue grew 22.2 percent organically: KGS revenue was $276.6 million, up 22.2 percent organically. KGS operating income was $17.3 million against $11.0 million, and Adjusted EBITDA was $27.7 million.
- Bid investments weigh on margins: Management said bid, proposal and new-program investments are currently adversely affecting profit margins.
- Q4 operating cash flow positive: Operating cash flow was $12.1 million, after about $51.8 million of working capital use for receivables, inventory and development investments. Free cash flow used was $0.1 million after $24.2 million of capex.
From this 10-K
Kratos Defense & Security Solutions makes drones, rocket and hypersonic systems, jet engines, microwave electronics, satellite ground systems and training systems for defense, national security and commercial customers. It was incorporated in New York on December 19, 1994, began operations in March 1995, and reincorporated in Delaware in 1998. Its fiscal 2025 ended December 28, 2025.
The four quarters: Q1 FY2025 · Q2 FY2025 · Q3 FY2025 · Q4 FY2025
Income statement (profit and loss)
| $ million | FY2025 | FY2024 | FY2023 | On the year | Last 8 years |
|---|---|---|---|---|---|
| Revenue | 1,347 | 1,136 | 1,037 | +18.5% | |
| Cost of revenue | 1,039 | 849 | 768 | +22.4% | |
| Gross profit | 308 | 287 | 269 | +7.2% | |
| Gross margin | 22.9% | 25.3% | 25.9% | ||
| Research and development | 40.0 | 40.3 | 38.4 | -0.7% | |
| Selling, general and administrative | 240 | 217 | 199 | +10.6% | |
| Operating income | 25.6 | 29.0 | 31.1 | -11.7% | |
| Operating margin | 1.9% | 2.6% | 3.0% | ||
| Interest expense | 9.6 | 15.2 | 21.7 | -36.8% | |
| Pre-tax income | 34.0 | 26.5 | 11.1 | +28.3% | |
| Income tax | 12.0 | 10.2 | 8.7 | +17.6% | |
| Effective tax rate | 35.3% | 38.5% | 78.4% | ||
| Net income | 22.0 | 16.3 | -8.9 | +35.0% | |
| Net margin | 1.6% | 1.4% | -0.9% | ||
| Diluted EPS | $0.13 | $0.11 | -$0.07 | +18.2% |
Read more
Free cash flow is operating cash flow less capital expenditure; the effective tax rate is income tax over pre-tax income; margins are the line over revenue. Gross profit is revenue less cost of revenue, and operating income is revenue less the company's own total costs, where the statement does not print those lines. Those four are arithmetic on the filed numbers; everything else is as filed. Money is in $ million as the company files it, or in $ billion by the switch above the tables; per share figures and share counts are as they are.Cash flow
| $ million | FY2025 | FY2024 | FY2023 | On the year | Last 8 years |
|---|---|---|---|---|---|
| Operating cash flow | -42.1 | 49.7 | 65.2 | ||
| Capital expenditure | 95.3 | 58.2 | 52.4 | +63.7% | |
| Free cash flow | -137 | -8.5 | 12.8 | ||
| Free cash flow margin | -10.2% | -0.7% | 1.2% | ||
| Cash from investing | -88.3 | -69.7 | -43.8 | ||
| Cash from financing | 361 | 278 | -30.7 | +29.9% | |
| Depreciation and amortisation | 47.1 | 40.3 | 33.2 | +16.9% | |
| Share-based compensation | 35.5 | 29.8 | 25.3 | +19.1% | |
| Diluted shares, weighted | 165m | 151m | 130m | +9.5% | |
| Shares outstanding at period end | 169m | 151m | 129m | +11.8% |
Balance sheet
| $ million | FY2025 | FY2024 | FY2023 | On the year | Last 8 years |
|---|---|---|---|---|---|
| Shareholders' equity | 1,996 | 1,353 | 976 | +47.5% | |
| Non-controlling interest | n/a | 0.0 | 22.5 | ||
| Redeemable equity | n/a | 0.0 | 22.5 | ||
| Debt | 0.0 | 175 | 219 | ||
| Operating lease liabilities | 33.8 | 29.8 | 37.8 | +13.4% | |
| Finance lease liabilities | 95.8 | 64.4 | 50.9 | +48.8% | |
| Other liabilities | 341 | 329 | 304 | +3.8% | |
| Total liabilities and equity | 2,467 | 1,951 | 1,632 | +26.5% | |
| Goodwill | 596 | 569 | 569 | +4.7% | |
| Intangible assets | 53.9 | 53.8 | 62.4 | +0.2% | |
| Cash and equivalents | 561 | 329 | 72.8 | +70.2% | |
| Receivables | 165 | 118 | 129 | +40.4% | |
| Other assets | 1,092 | 881 | 799 | +23.9% | |
| Total assets | 2,467 | 1,951 | 1,632 | +26.5% |
10-K for the year ended 28 December 2025, filed 23 February 2026: the filing.