Abstract
Mercury will release its quarterly results on February 03, 2026 Post Market; this preview consolidates last quarter’s metrics, current-quarter forecasts, and recent institutional commentary to frame expectations around revenue, margins, and adjusted EPS.
Market Forecast
For the quarter to be reported, Mercury’s revenue is forecast at USD 210.85 million, implying an estimated year-over-year increase of 15.59%; forecast EBIT is projected at USD -8.05 million with an estimated YoY improvement of 59.80%, and forecast EPS is expected at USD 0.06 with an estimated YoY growth of 251.62%. Forecasts for gross profit margin, net profit margin, and adjusted EPS YoY are not provided beyond the EPS estimate; the majority of sell-side commentary anticipates sequential operational stabilization with gradual margin recovery tied to program execution. The main business highlight centers on automation command systems, while the most promising segment is automation command systems with revenue of USD 111.47 million; YoY data was not disclosed.
Last Quarter Review
In the previous quarter, Mercury reported revenue of USD 225.21 million, gross profit margin of 27.93%, GAAP net profit attributable to the parent company of USD -12.52 million, net profit margin of -5.56%, and adjusted EPS of USD 0.26, with year-over-year revenue growth of 10.16%. Quarter-on-quarter net profit growth was -176.45%, reflecting program timing and cost absorption dynamics; the core business mix was led by automation command systems at USD 111.47 million, alongside radar at USD 30.19 million, other sensors/effectors at USD 29.77 million, electronic warfare at USD 21.00 million, and other at USD 32.79 million.
Current Quarter Outlook (with major analytical insights)
Main business: Automation Command Systems
Automation command systems remain Mercury’s largest revenue contributor at USD 111.47 million last quarter. Near-term performance hinges on execution across active programs, schedule adherence, and cost controls that support margin stability. With the company guiding toward improved EBIT versus the prior quarter’s actual, this segment’s throughput and delivery milestones will be instrumental in translating revenue into gross margin consistency. Mix effects matter: higher-value integrated solutions and software-rich content typically carry better margins, so incremental wins or accelerated deliveries within these sub-domains can lift overall profitability even if headline revenue remains comparatively steady. Supply-chain alignment and timely customer acceptances will also influence cash conversion and, by extension, reported EPS.
Most promising business: Automation Command Systems
The most promising growth potential lies within automation command systems given its scale and leverage to ongoing modernization cycles. The forecast profile suggests a path to EBIT improvement, which typically tracks with this segment’s cost absorption and yield on complex builds. Efficiency gains—ranging from better labor productivity to negotiated input costs—can materially affect segment-level margins; as execution matures, the sensitivity of overall results to this line is substantial. While quarterly revenue may fluctuate with contract timing, backlog conversion and program phase progression can improve visibility over the next few quarters. Investors will watch unit economics and delivery cadence to assess whether the revenue base can sustain improving gross profit margins and translate into higher adjusted EPS.
Stock price drivers this quarter
EPS delivery versus the USD 0.06 forecast is the focal variable for sentiment, especially given the prior quarter’s negative GAAP net profit and the anticipated EBIT improvement this quarter. The revenue trajectory—forecast at USD 210.85 million—will be measured against management’s program commentary and any qualitative signals around backlog conversion, as these factor into expectations for margin normalization. The relationship between mix and gross profit margin is another key driver: visibility on product and program composition, and any commentary around pricing or cost dynamics, may influence expectations for net profit margin recovery. Finally, clarity around operational milestones—acceptances, schedules, and supply chain constraints—could recalibrate near-term forecasts if execution risks emerge or abate.
Analyst Opinions
The majority of institutional commentary in recent weeks has skewed cautiously constructive, emphasizing stabilization and incremental improvement rather than rapid acceleration. Coverage notes underscore the significance of program execution for margins and EPS, with consensus seeking confirmation that the EBIT outlook—forecast at USD -8.05 million versus a worse prior-quarter actual—translates to sequential operational recovery. Analysts highlight the balance between revenue scale and profitability mix, indicating that any progress in automation command systems deliveries may help lift gross profit margin and support the USD 0.06 EPS target. Against this backdrop, the prevailing view expects Mercury to meet or slightly exceed revenue guidance while demonstrating early margin traction within core programs, which would set the stage for improved confidence into subsequent quarters.Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
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