Science Applications International (SAIC) Q1 2027 earnings summary

Executive summary

• Revenues for Q1 FY27 reached $1.91 billion, up 2% year-over-year, with 0.5% organic growth after adjusting for the SilverEdge acquisition, driven by contract ramp-ups and disciplined execution.

• Net income rose 69% year-over-year to $115 million, with adjusted diluted EPS of $3.23, reflecting improved profitability, a $12 million gain from an investment sale, and a lower share count.

• Adjusted EBITDA was $222 million (11.6% margin), up from 8.4% a year ago, supported by margin expansion, operational excellence, and non-recurring gains.

• Leadership is focused on regaining stakeholder trust through sustained organic growth, portfolio realignment, and business process transformation, including Project Orbit and a leadership transition in the civilian business group.

• The company reorganized into three business groups, aggregated into two reportable segments: Defense and Intelligence, and Civilian.

Financial highlights

• Q1 revenue was $1.91 billion, with adjusted EBITDA of $222 million (11.6% margin), adjusted diluted EPS of $3.23, and free cash flow of $118 million.

• Operating income increased to $179 million, with operating margin improving to 9.4% from 6.4% year-over-year.

• Weighted-average diluted shares outstanding decreased to 44.0 million from 47.8 million.

• Book-to-bill ratio for the quarter was 1.1x, with trailing twelve months at 1.0x.

• Free cash flow improved from $(44) million year-over-year to $118 million.

Outlook and guidance

• FY27 revenue guidance maintained at $7.0–$7.2 billion, with organic growth expected between -4% and 4%.

• Adjusted EBITDA guidance raised to $720–$730 million (10.1%–10.3% margin), and adjusted diluted EPS guidance increased to $9.90–$10.10.

• Free cash flow guidance reiterated at over $600 million for FY27 and at least $13 per share for FY28.

• Approximately $6.6 billion in remaining performance obligations, with 76% expected to be recognized as revenue in the next 12 months.

• Major new contracts and recompetes support robust backlog and future growth.