Defense Tech Giant SAIC Scores Profit Win But Lowers Outlook

Science Applications International Corp. (NASDAQ:SAIC) reported fiscal fourth-quarter 2026 earnings on Monday.

The company reported a quarterly sales decline of 5% year-on-year to $1.75 billion, narrowly missing the analyst consensus estimate of $1.77 billion.

The adjusted EPS of $2.62 beat the analyst consensus estimate of $2.13.

SAIC provides technical, engineering, and enterprise information technology services, primarily for the defense, space, civilian, and intelligence markets.

Margins And Cash Flow

Operating income for the quarter fell 4% to $133 million, and the operating margin rose by 10 basis points to 7.6%. Adjusted operating income rose 2% to $179 million, with the margin expanding 60 basis points to 10.2%.

Adjusted EBITDA increased 2% to $181 million with an adjusted EBITDA margin of 10.3%, a 70 basis point rise.

Net bookings for the quarter were approximately 600 million, which reflects a book-to-bill ratio of 0.3.

The quarter’s operating cash flow totaled $258 million. Free cash flow was $336 million.

SAIC’s estimated backlog at the end of fiscal 2026 was approximately $22.6 billion, of which $3.6 billion was funded.

As of January 30, 2026, the company held $182 million in cash and equivalents.

As previously announced, after the fiscal year-end, the company’s Board of Directors declared a cash dividend of 37 cents per share payable on April 24, 2026, to stockholders of record on April 10, 2026. 

CEO Jim Reagan said the company’s fourth-quarter results reflected continued revenue pressure but also demonstrated strong operational execution, supporting higher-margin expectations going forward. He noted that the company is making progress and sees opportunities ahead.

Outlook

Science Applications lowered its fiscal 2027 adjusted EPS outlook to $9.50–$9.70 from the prior range of $9.90–$10.10, compared with the analyst consensus estimate of $9.56.

The company reaffirmed its fiscal 2027 revenue guidance of $7.0 billion to $7.2 billion, compared with the analyst consensus estimate of $7.3 billion.

The company also projects fiscal 2027 adjusted EBITDA of $705 million to $715 million and free cash flow of more than $600 million.

SAIC Price Action: Science Applications Intl shares were up 1.58% at $93.36 at the time of publication on Monday, according to Benzinga Pro data.

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